alexgrover

Efficient Trend Step - Spotting Trends Efficiently

Introduction

The trend-step indicator (or auto-line) was based on volatility and aimed to spot trends in an adaptive way, however the indicator was only based on volatility and didn't gave much attention to the trend, later on i would publish an efficient version of it (efficient auto-line) based on the efficiency ratio who could adapt to the trend and eliminate potential whipsaws trades, however this approach included many settings that would require changes if the user switched markets, which reduce the utility of the indicator and make it actually super inefficient.

This is why i had to propose this indicator who remove all the flaws the efficient auto-line had without removing the core idea of it.

The Indicator

The indicator is based on recursion, when the price is superior/inferior to the indicator precedent value +/- volatility metric, then the indicator is equal to the closing price, this allow the indicator to fit the price relatively well. The volatility metric used is based on 2 standard deviations, one fast and one slow and the efficiency ratio, basically when price is trending the volatility metric will be closer to the value of the fast standard deviations, which would allow the indicator to be closer to the price, else the metric will be closer to the slow standard deviation which restrain the indicator from changing, therefore the volatility metric act as a threshold.


length control the period of the efficiency ratio, lower values of length will result in a volatility metric way closer to the fast standard deviation thus making the indicator more inclined toward making false signals.


Lower values for slow will make the indicator more reactive.


The indicator can be reactive but can also be really conservative, thus even remaining unchanged in some contrary movements of the main trend, this is called robustness and has its pro's and con's.

Conclusion

The trend-step indicators family might get to an end, or not, nonetheless they can provide precise entries and be extremely robust, which is great. Using low settings might prove to be useful to remove some noise. I hope this version find its use amongst the community. Thanks for reading !


Phát hành các Ghi chú: Details Of the Update :

- Select different price types/indicators as input

- Removal of the bar_index object

- Cleaner code
Gỡ bỏ khỏi Script Ưa thích Thêm vào Script Ưa thích
You can check my indicator papers here : https://figshare.com/authors/Alex_Pierrefeu/7339466
Since the source of data comes at close, does this mean it should only be viewed via the daily chart?
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alexgrover brandonlongo0
@brandonlongo0, You can view on any time frame, if using closing price bother you, you can replace close by open in the script :)
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@alexgrover, Thank you. This code warns about repainting. Have you observed this while using this indicator?
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alexgrover brandonlongo0
@brandonlongo0, No the indicator won't repaint, but the bar_index element is often associated with this effect, a future update will make the indicator more efficient.
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Excellent! Thank you.
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This work looks cool and will be helpful for the traders.Keep up the Good work and sharing the pine script too.
Thanks and Regards from Author of LongBuyLongSellIndicator in tradingview
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@MarxBabu, Thanks for the support
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Great work, I ll try it
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@efazil, Thx for the support and for trying it.
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Clean and efficient. Thanks
+2 Phản hồi
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