Volatility FilterThe "Volatility Filter" script is designed to measure market volatility across two different timeframes and determine whether the market is flat or trending.
It uses custom-tuned versions of four different indicators to measure volatility and distinguish between trending and ranging conditions.
The selected indicators are:
1 - Average Directional Index (ADX) Volatility
2 - Damiani Volameter
3 - Trader Pressure Index (TPI)
4 - Williams Alligator Indicator
The script calculates a filter score for both the current timeframe and a user-specified higher timeframe. It offers two types of filter scores, controlled by the 'FilterType' parameter. The filter score is then visualized on the chart as the main oscillator for the current timeframe and a filled bar for the higher timeframe.
The script utilizes a custom moving average function that provides 17 different ways to calculate a moving average, giving the user extensive flexibility in tailoring the script to their needs.
By using custom indicators and unique score calculation methods across two timeframes, this script provides a comprehensive measure of market volatility, aiding traders in identifying trending and ranging market conditions.
This script also provides two additional parameters for tuning its calculations and output, allowing to adjust the script to any trading style and the characteristics of the market being traded.
1 - Threshold: This parameter sets a threshold that the oscillator needs to surpass for the current market move to be considered as a trend. By adjusting the threshold, traders can control how much volatility is required to register a move as trending. A higher threshold will require more volatility for a trend to be recognized, meaning that the market needs to be moving more strongly for a trend to be identified.
2 - Length: This parameter is used to smooth the oscillator. It determines the number of periods used in the calculation of the moving average of the volatility filter score. A longer length will consider more data points and therefore provide a smoother line, which can be useful in accounting for the fading of trends. When trends start to lose their strength but are still present, a longer length can help in maintaining the recognition of the trend, aiding in making accurate trading decisions.
By adjusting these parameters, traders can fine-tune the script's sensitivity to market volatility and its recognition of trends, providing valuable flexibility in adapting to different market conditions and trading strategies.
Tpi
UCS_Trader Pressure Indicator -V1Welcoming everyone to a simple Indicator. I have used the volume of a stock to establish how commited the market for that particular ticker is when it comes to a direction.
The idea behind the indicator is how much of commitment there is towards a move.
*** This indicator is non directional*** ie., It just measures the commitment behind a move.
Why is it important.
Let's say we have a uptrending stock with low commitment (pressure), the bounce on any pullback will not be able carry that any further. So the pressure on the Pullback could drop the stock below and add additional risk. Only for us to wish and think, we checked that previously.
Essentially, If a Trend is being established with a strong pressure (VOLUME BASED). It is more likely to continue.
How you would use this is upto you. But general ideas in Some of these snapshots.
Concluding -
The trend in combination with TPI - Stronger Trend.
In such stronger trends - A pullback (oppsing the trend) have higher probability to bounce.
NOTE - Experiement with the indicator and Trade at your own risk This is a tool, not a system.
Feedbacks are welcome and will be considered for improvement.
Best Wishes
