BITCOIN SMASHERThe BITCOIN SMASHER strategy is a trend-following and momentum-based trading system designed for Bitcoin. It utilizes a combination of Exponential Moving Averages (EMAs), RSI,to determine optimal entry and exit points while incorporating risk management features such as dynamic stop loss, take profit, trade cooldowns, and max daily loss limits.
Trend Analysis
Chaikin Money Flow with EnhancementsThis enhanced version of the Chaikin Money Flow (CMF) indicator is designed to help traders better understand market sentiment by visualizing momentum shifts and trends based on volume-weighted accumulation and distribution.
CMF Calculation: The CMF line is calculated using the typical CMF formula, which compares the close price to the high/low range, weighted by volume.
Fading Color Zones: Green and red fading zones are added between the CMF line and the zero line. Green represents bullish momentum (CMF above zero), and red represents bearish momentum (CMF below zero). These zones highlight key shifts in market sentiment.
Cross Detection: The indicator detects when the CMF crosses above or below the zero line, signaling potential trend changes. The price and CMF values at the time of the cross are stored and can be used for further analysis.
Average Line: A configurable moving average of the CMF is plotted to provide a smoothed trendline, helping traders identify the overall direction of market sentiment.
This indicator is ideal for traders who want to enhance their technical analysis by incorporating volume-weighted momentum indicators and identifying trend reversals more clearly.
Opening Range Time Frames 1Opening Range for 3 different time frames customizable color and timeframes. I use it for Tokyo, London, New York. but times are customizable to whatever you want them to be.
Multi-Asset PerformanceUpdate and Creation
The original code was created by LevianthanCapital.
It was not updated for PineScript V6, so I updated it.
General Overview
Indicator: "Multi-Asset Performance".
Main objective: Display the cumulative performance (in percentage) of 30 financial assets.
Offers various visualization options such as lines, circles, areas, and columns.
User Settings and Configuration Options
Data Source: Choose between Price, OBV, or Open Interest.
Calculation Period and Timeframe: Set the period (e.g., 1 DAY, 5 MIN) and select the timeframe used in calculations.
Asset Groups: Three groups (Group 1, Group 2, Group 3) determine which 30 assets are displayed.
Customization Options:
Smoothing with a Simple Moving Average (SMA) over a customizable period.
Highlighting of top and bottom performers using a specific color.
Option to display the group mean either by using the first ticker or by calculating the
average performance of all assets.
Configuration of the data table including its position, size, borders, and text settings.
Calculation Logic
Cumulative Change Calculation:
Computes the percentage change by comparing the current price (or chosen data type) to the price at the beginning of the defined period.
The starting price is captured using a condition based on either a visible range, a specified timestamp, or the detection of a new period.
Ticker Extraction and Formatting:
Processes each symbol by splitting the string to remove prefixes (e.g., "AMEX:") and display only the ticker.
Group Mean Calculation:
Two modes: use the first asset's performance or calculate the arithmetic mean of all asset performances.
Additional Indicators:
Correlation: Calculates how each asset's performance correlates with the group mean.
Beta: Computes the sensitivity (beta) of each asset relative to the group mean by considering the ratio of standard deviations and correlation.
RSI: Uses the Relative Strength Index to evaluate the momentum of the performance series.
Visualization and Display
Plotting the Curves:
Uses the plot function to display each asset's performance.
The visual style (lines, circles, areas, columns) is selectable, and a custom color palette is applied.
Labels and Annotation Lines:
Creates labels to display the asset tickers next to the plots.
Optionally draws connecting lines between the plot and its label.
For proper positioning in PineScript V6, it is recommended to include parameters like xloc=xloc.bar_index.
Data Table:
A table is generated to show each asset’s ticker and percentage change.
Additional columns can display correlation, RSI, and beta if enabled.
Distribution Profile:
Visualizes the distribution of asset performances around the group mean.
Uses boxes and lines to indicate the number of assets within defined performance zones.
Conclusion
The indicator offers a comprehensive analysis of the cumulative performance of 30 assets by integrating multiple technical indicators.
It provides extensive customization for both visualization and data display, suitable for advanced technical analysis.
The update to PineScript V6 enhances real-time handling and visual display, though further fine-tuning may be required for optimal rendering of the current day.
Impulse MACD con JMA Mejoradousa Jurik moving average, en vez de ema, suaviza más las lineas del macd.Traté de mejorar el impusle MACD de Lazy Bear.Espero le sirva
TMA StrategyThe **TMA Strategy** is a trend-following strategy that leverages **Smoothed Moving Averages (SMMA)** and **candlestick patterns** to identify high-probability trading opportunities. It is designed for traders who want to capture strong trends while minimizing noise from short-term fluctuations.
**Key Features:**
✔ **Multiple Smoothed Moving Averages (SMMA):** Uses 21, 50, 100, and 200-period SMMAs to identify market trends and key support/resistance zones.
✔ **Candlestick Pattern Confirmation:** Incorporates **3-line strike** and **engulfing candle** patterns to confirm trade entries.
✔ **Dynamic Trend Filter:** A **2-period EMA** ensures that trades align with the dominant trend, reducing false signals.
✔ **Customizable Session Filter:** Allows users to enable/disable trading within specific market sessions (New York, London, Tokyo, etc.), ensuring trades are executed only during high-liquidity hours.
✔ **Risk Management:** Uses predefined exit conditions based on EMA/SMMA crossovers to lock in profits and minimize losses.
**Trading Logic:**
📌 **Long Entry:**
- Bullish Engulfing or 3-Line Strike pattern appears.
- Price is above the 200 SMMA.
- 2 EMA confirms an uptrend.
- Trade executes if session filter allows.
📌 **Short Entry:**
- Bearish Engulfing or 3-Line Strike pattern appears.
- Price is below the 200 SMMA.
- 2 EMA confirms a downtrend.
- Trade executes if session filter allows.
📌 **Exit Conditions:**
- Long trades exit when EMA(2) crosses **below** SMMA(200).
- Short trades exit when EMA(2) crosses **above** SMMA(200).
**Ideal Markets & Timeframes:**
✅ Best suited for **Forex, Stocks, and Crypto** markets.
✅ Works well on **higher timeframes (15m, 1H, 4H, Daily)** for stronger trend confirmation.
📢 **Disclaimer:**
This strategy is for educational purposes only. Backtest results do not guarantee future performance. Always use proper risk management and test in a demo account before live trading.
🚀 **Try the TMA Strategy now and enhance your trend-following approach!**
Wick Highlighter- Description
This script is a custom Multi-Wick Zone Highlighter that detects and highlights significant candle wicks on your chart. It is designed to work across multiple timeframes and uses time‑anchored boxes to “stick” to the original wick levels, ensuring that highlighted zones remain fixed even when panning or zooming the chart.
- Key Features
Wick Detection:
The script examines each candle to determine whether its upper or lower wick exceeds a user‑defined minimum size. Only wicks that meet or exceed this threshold are considered significant and trigger the creation of a highlight zone.
Zone Creation and Removal:
When a qualifying wick is detected, the script creates a colored zone (using anchored boxes) that spans from the wick tip to the candle’s body (top for upper wicks and bottom for lower wicks). Each zone remains visible until it is “filled” by subsequent price action. The fill condition is determined by a user‑adjustable fill percentage. For example, setting the fill percentage to 100% will remove the zone once the next candle’s high (for an upper wick) or low (for a lower wick) reaches the corresponding body level.
Multiple Zones:
This indicator supports multiple simultaneous zones. Each wick that qualifies is independently tracked and will not be overwritten by a later candle unless its fill condition is met. Separate flags ensure that if a candle fills an existing zone on one side, it does not create a new zone on that same side, maintaining clarity on your chart.
Time-Anchored Positioning:
To keep zones properly anchored even when you change timeframes or pan the chart, the script uses the bar’s time value rather than the bar index. This ensures that each zone remains fixed to the specific price levels where the wick was detected.
- Usage Notes
User-Adjustable Inputs:
Minimum Wick Size (Points): Set the minimum wick length to trigger a zone.
Wick Fill Percentage (%): Set the percentage into the wick at which the zone is considered filled and will be removed.
Zone Extend Bars: Control how far to the right (in terms of bars) each zone is extended.
Ideal For:
Traders who wish to visually identify key price zones based on significant candle wicks, and who require these zones to remain fixed and clear on the chart until they are actively filled by subsequent price movement.
Liquidations Levels [RunRox]📈 Liquidation Levels is an indicator designed to visualize key price levels on the chart, highlighting potential reversal points where liquidity may trigger significant price movements.
Liquidity is essential in trading - price action consistently moves from one liquidity area to another. We’ve created this free indicator to help traders easily identify and visualize these liquidity zones on their charts.
📌 HOW IT WORKS
The indicator works by marking visible highs and lows, points widely recognized by traders. Because many traders commonly place their stop-loss orders beyond these visible extremes, significant liquidity accumulates behind these points. By analyzing trading volume and visible extremes, the indicator estimates areas where clusters of stop-loss orders (liquidity pools) are likely positioned, giving traders valuable insights into potential market moves.
As shown in the screenshot above, the price aggressively moved toward Sell-Side liquidity. After sweeping this liquidity level for the second time, it reversed and began targeting Buy-Side liquidity. This clearly demonstrates how price moves from one liquidity pool to another, continually seeking out liquidity to fuel its next directional move.
As shown in the screenshot, price levels with fewer anticipated trader stop-losses are indicated by less vibrant, faded colors. When the lines become more saturated and vivid, it signals that sufficient liquidity - in the form of clustered stop-losses has accumulated, potentially attracting price movement toward these areas.
⚙️ SETTINGS
🔹 Period – Increasing this setting makes the marked highs and lows more significant, filtering out minor price swings.
🔹 Low Volume – Select the color displayed for low-liquidity levels.
🔹 High Volume – Select the color displayed for high-liquidity levels.
🔹 Levels to Display – Choose between 1 and 15 nearest liquidity levels to be shown on the chart.
🔹 Volume Sensitivity – Adjust the sensitivity of the indicator to volume data on the chart.
🔹 Show Volume – Enable or disable the display of volume values next to each liquidity level.
🔹 Max Age – Limits displayed liquidity levels to those not older than the specified number of bars.
✅ HOW TO USE
One method of using this indicator is demonstrated in the screenshot above.
Price reached a high-liquidity level and showed an initial reaction. We then waited for a second confirmation - a liquidity sweep followed by a clear market structure break - to enter the trade.
Our target is set at the liquidity accumulated below, with the stop-loss placed behind the manipulation high responsible for the liquidity sweep.
By following this approach, you can effectively identify trading opportunities using this indicator.
🔶 We’ve made every effort to create an indicator that’s as simple and user-friendly as possible. We’ll continue to improve and enhance it based on your feedback and suggestions in the future.
Live Bar Inside Bar ColoringThis script colors the current candle if it is inside the prior candle on the timeframe displayed.
There are other indicators which color inside bars, this indicator only colors the live / active candle.*
This also allows it to color differently if price is above or below the candle open.
* Note, there is a bug where a prior candle's color will persist, if you can identify the issue I will be grateful!
Multi-day Rolling VWAP LevelsRolling vwap levels. Timeframe independant. Clean horizontal lines for the 7, 30, 90, and 365-day VWAP levels Labels positioned to the right with black text and no background. Proper alignment that moves with the chart when scrolling.
Cipher [CdeCripto]Improve Your Trading with the Cipher Indicator
Discover the power of the newly enhanced Cipher indicator—a sophisticated tool that combines multiple technical analyses to help you make better trading decisions. This chart integrates advanced features such as:
Multi-Timeframe Analysis:
The indicator examines higher timeframes to capture key bearish and bullish patterns. It checks that the RSI+MFI area is below zero (indicating a red zone), while the WaveTrend is above zero and crossing down, and confirms that the VWAP on the higher timeframe is below zero. This combination helps signal potential market reversals.
Heikin-Ashi Integration (Diamond Pattern):
By analyzing the latest Heikin-Ashi candles from two higher timeframes, the indicator identifies strong bearish or bullish conditions. When both higher timeframe candles are red and the WaveTrend is showing a downward cross, it marks a bearish diamond pattern (and vice versa for bullish), offering a clear visual cue for market entry or exit.
Divergence & Signal Confirmation:
Alongside standard buy and sell signals, the indicator also displays divergence signals using WaveTrend, RSI, and Stochastic RSI, adding an extra layer of confirmation. This multi-indicator approach helps filter out false signals and improves the precision of your trading strategy.
Whether you’re a seasoned trader or just starting out, the Cipher indicator is designed to give you an edge by providing a clear, multi-dimensional view of market dynamics. Use it to enhance your trade setups and better anticipate market reversals.
CryptoShakes v7
The CryptoShakes indicator is a comprehensive technical analysis tool designed to provide traders with a multifaceted view of cryptocurrency markets. By combining various technical indicators, chart patterns, and harmonic formations, CryptoShakes aims to identify high-probability trading opportunities through points of confluence. The key to successful trading lies in recognizing when multiple signals align, offering stronger confirmation of potential market movements. This indicator suite includes the Ichimoku Cloud, Bollinger Bands, Williams Alligator, momentum indicators, candlestick patterns, and harmonic pattern detection, among others. Each component contributes to a holistic market analysis, allowing traders to make more informed decisions.
To maximize the effectiveness of CryptoShakes, users are encouraged to personalize the tool according to their trading style, risk tolerance, and preferred timeframes. Adjusting input parameters, toggling the visibility of specific components, and fine-tuning color schemes can significantly enhance readability and focus attention on the most relevant signals for individual trading strategies. Remember, while CryptoShakes provides a wealth of information, it's crucial to combine these insights with proper risk management and a thorough understanding of market fundamentals for optimal trading results.
Request access for two week analysis.
MTrades AlertsMTrades Alerts
Developed by MTrades
Description:
The EMA 5, 12, and 50 Crossover Signal indicator is designed to provide precise buy and sell signals by leveraging the power of Exponential Moving Averages (EMAs). It is specifically crafted to follow the market trend and minimize false signals, making it ideal for both beginners and professional traders.
How It Works:
This indicator utilizes three key EMAs:
EMA 5 (Blue Line): Short-term trend indicator.
EMA 12 (Red Line): Medium-term trend indicator.
EMA 50 (Purple Line): Long-term trend filter.
Signal Generation:
Buy Signal:
Triggered when the price crosses above EMA 12 from below.
Condition: Price must also be above EMA 50 to ensure the trade is aligned with the overall bullish trend.
A green label is displayed below the candle to indicate the buy signal.
Sell Signal:
Triggered when the price crosses below EMA 12 from above.
Condition: Price must also be below EMA 50 to ensure the trade is in line with the overall bearish trend.
A red label is displayed above the candle to indicate the sell signal.
Special Features:
Trend Confirmation: Using EMA 50 as a trend filter reduces false signals in ranging markets.
Visual Cues: Clear buy and sell labels for quick decision-making.
Alerts: Built-in alerts for both buy and sell signals, allowing traders to stay updated even when away from the screen.
Why Use This Indicator?:
This indicator is designed to:
Capture momentum at the right time.
Avoid trading against the prevailing trend.
Provide reliable entry and exit points for swing trading and intraday trading.
Developed by MTrades:
This indicator is crafted by MTrades to simplify trading decisions while maximizing profitability by staying in tune with the market trend. It's an ideal tool for traders who seek precision and clarity in their trading strategy.
Momemtum catherDetects momemtum movement of market, and plots a simple trade plan when signal triggers. All input factors cutomisable to fit the ticker.
Gap Statistics (Positive and Negative, Excluding 0 Gaps)Gap statistics for all tf's. Positive and Negative values are seperately evaluated.
Simple Bull and Bear Algo SignalThis Indicator has filtered out most of the noise, with combination of Moving average as second confirmation, it provides as accurate as possible to avoid any false signal. You have the option to change the MA based on your needs, and TP / SL leveling as well. Enjoy!
You may join my telegram for other Free indicator or EA at no cost!
t.me
Forward-Backward Exponential Oscillator [LuxAlgo]The Forward-Backward Exponential Oscillator is a normalized oscillator able to estimate directional shifts by making use of a unique "Forward-Backward Filtering" calculation method for Exponential Moving Averages (EMAs).
This unique method provides a smooth normalized representation of the price with reduced lag.
🔶 USAGE
The oscillator consists of 2 series of values derived from normalizing the sum of each EMA's change across the selected user lookback window (length), one less reactive computed forward (in grey), and the other re-calculated backward for each bar (in blue).
Given this "Forward-Backwards" calculation method, we are able to produce a more reactive oscillator compared to the same operation done on a simple double-smoothed EMA.
The interaction between these 2 values (Forward Value and Backward Value) can highlight shifts in market momentum over time.
When the Forward Value is above the Backward Value, the price is seen moving up, and likewise, when the Forward EMA is below, the Backward EMA price is seen moving down.
The indicator specifically displays the difference between values through a histogram located at the 50 mark on the oscillator.
🔹 Projection
We project the approximated future values of the forward value in front of the current line. This helps show the data that is being used for the creation of the Forward Value.
🔹 Length & Smoothing
The Smoothing Input controls the length of the EMAs which are analyzed.
The Length Input controls the lookback for the sum of changes from the EMAs.
Displayed below is a comparison of varying input sizes and their results.
As seen above:
A larger length input will result in slower, gradual movement by the oscillator since the summed values are from a larger lookback.
A higher smoothing setting will result in smoother EMAs, leading to a smoother oscillator output that is less contaminated by noisy variations.
Note: The length of the projection is tied to the "length" input, to get a longer projection, a larger length is required.
🔶 DETAILS
Forward-backward filtering is a method applied to LTI (linear time-invariant) filters to provide a filter response with zero-phase shift, this has the visible effect of shifting a regular causal filter response to the right, making it appear has have effectively 0 lag.
The name of this operation indicates that the filter is first calculated forward over a series of values (like regular moving averages), then calculated backward, using the previous output as input for the filter, effectively applying the filter twice.
While this operation effectively allows us to obtain a zero-lag response when applied to an EMA, it is subject to repainting, as this indicator only returns the normalized sum of changes of the forward-backward EMA, which does not introduce any repainting behaviors in the final output of the oscillator.
🔶 SETTINGS
Length: Change the calculation lookback length for the oscillator.
Smoothing: Alter the smoothness of the back-end EMA calculations.
Source: Change the source input used for the indicator.
FRAMA + Aroon StrategyThis strategy uses:
1. FRAMA to detect adaptive trend channels.
2. Aroon to confirm trend direction.
3. Risk management with stop-loss and take-profit levels.
4. Visual indicators to track signals and trends
This strategy is highly effective for trading the NASDAQ 100 and the USD/JPY currency pair. Both markets can be traded using the default parameters without adjustments.
Additionally, this strategy does not repaint, ensuring that signals remain stable and reliable for backtesting and live trading
Arbitrage Futures Spot Spread by MoneyHasslerЭтот спред показывает разницу между ценой спотового актива (Spot Price) и ценой фьючерсного контракта (Futures Price).
SMA, WMA, EMA Indicator (WMA, SMA default) with Trading StrategySMA, WMA, EMA Indicator (WMA, SMA default) with Trading Strategy
Unlock powerful insights with the SMA, WMA, EMA Indicator, a comprehensive tool designed to optimize your trading strategy. This indicator combines key moving averages, including Simple Moving Averages (SMA), Exponential Moving Averages (EMA), and Weighted Moving Averages (WMA), with advanced confirmation features such as RSI and MACD to help you make informed trading decisions.
Key Features:
Multiple Moving Averages: Track trends across short, medium, and long timeframes with custom periods for SMA, EMA, and WMA, ensuring comprehensive market analysis.
Entry Signal Alerts: Receive precise buy and sell signals based on proven strategies. The script automatically marks safe, normal, and risky long and short entry points with easy-to-read labels.
MACD & RSI Confirmation: Incorporates momentum analysis with MACD and RSI to further validate entry conditions for enhanced accuracy.
Customizable Labels & Shapes: Personalize your chart with customizable label positions, colors, and sizes. Display entry signals (safe, normal, risky) in real time.
Intuitive Crossover Analysis: Watch for key crossovers between moving averages and spot potential trend reversals, with visual indicators like shapes and labels for easy decision-making.
Advanced Strategy Classification: Classify entries as safe, normal, or risky based on a comprehensive checklist, allowing you to tailor your approach to risk tolerance.
Ideal For:
Traders looking for a customizable tool to identify high-probability trading opportunities.
Those who want to blend multiple technical indicators for a deeper market analysis.
Anyone seeking an easy-to-use, visually-rich tool to enhance their decision-making process.
Perfect for both beginners and experienced traders who want to automate their trading strategy, reduce decision-making errors, and improve overall market analysis. Make your trading smarter with the SMA, WMA, EMA Indicator!
BuySell3BuySell3: Advanced Trend Trading Indicator
Adaptive signals, real-time stats, and precise exits for smarter trading.
Elevate your trading with BuySell3, a powerful tool blending customizable moving averages with sophisticated signal confirmation.
Key features:
Flexible MA types (SMA, EMA, WMA, HMA) with adjustable periods.
Multi-layered filters: Volume, RSI, ADX, and candlestick patterns.
Multi-timeframe trend alignment for smarter entries (from a higher timeframe).
Clear buy/sell and exit signals with real-time stats and backtesting (signals, win rate, avg win/loss).
Real-time alerts for buy, sell and exit signals.
Unlike basic MA crossovers, BuySell3 integrates multi-timeframe analysis, exit signals, and live stats for a complete trading system.
Designed for traders seeking precision and insight across daily and intraday charts.
[TehThomas] - ICT Volume ImbalanceThis script is a Volume Imbalance (VI) detector and visualizer for use on the TradingView platform. The goal of the script is to automatically identify areas where there are significant imbalances in the volume of trades between consecutive candlesticks and visually highlight these areas. These imbalances can provide traders with valuable insights about the market’s current condition, often signaling potential reversal or continuation points based on price and volume action.
ICT (Inner Circle Trader) Concept of Volume Imbalances
Volume imbalances are a critical concept in the ICT trading methodology. They refer to situations where there is an unusual or significant difference in volume between two consecutive candlesticks, which might indicate institutional or large player activity. According to ICT principles, these imbalances can show us areas of market inefficiency or potential price manipulation. By identifying these imbalances, traders can gain an edge in understanding where the market is likely to move next.
Bullish and Bearish Volume Imbalances:
Bullish Volume Imbalance: This occurs when there is a strong increase in buying pressure, typically indicated by a higher volume on a candle that closes significantly above the previous one, often leaving a gap or larger price movement. The market could be preparing to push higher, and the volume shows a clear shift in buying demand.
Bearish Volume Imbalance:
Conversely, a bearish imbalance occurs when there is a strong increase in selling pressure, typically signaled by a candle that closes significantly lower than the previous one, again with higher volume. This could indicate that large players are offloading positions, and the price is likely to drop further.
Key Features and Functions of the Script
The script automates the process of detecting these volume imbalances and visually marking them on a price chart. Let’s explore its functionality in detail.
1. Inputs Section
The script allows for significant customization through its input options, which help traders adjust the detection and visualization of volume imbalances based on their individual preferences and trading style. Below are the details:
lookback (250 bars): This input specifies the number of bars (or candles) the script should look back when analyzing the volume imbalance. By setting this to 250, the user is looking at the last 250 bars on the chart to detect any significant volume imbalances. This period is adjustable between 50 to 500 bars.
volumeThreshold (1.0 multiplier): This input helps set the sensitivity for identifying volume imbalances. The script compares the volume of the current candle with the previous one, and if the current volume exceeds the previous volume by this threshold multiplier (in this case, 1.0 means at least equal to the previous volume), then it triggers an imbalance. Users can adjust the multiplier to suit different market conditions.
showBoxes (true/false): This toggle determines whether the boxes representing volume imbalances are drawn on the chart. When enabled, the script visually highlights the imbalances with colored boxes.
fillBaseColor (orange with 80% opacity): This is the color setting for the background of the imbalance boxes. A softer color (like orange with opacity) ensures the imbalance is highlighted without obscuring the price action.
borderColor (gray): The color of the border around the imbalance boxes. This adds a visual distinction to make the imbalance areas more visible.
borderWidth (1 pixel): This controls the width of the box's border to adjust how prominent it appears.
rightOffset (30 bars): This input controls how far the imbalance box extends to the right on the chart. It helps users anticipate the potential continuation of the imbalance beyond the current candle.
allowWickOverlap (true/false): This setting allows imbalances to be identified even if the wicks of the two consecutive candlesticks overlap. If set to false, only imbalances where the bodies of the candlesticks don’t overlap are considered.
showBrokenBoxes (true/false): If enabled, once a volume imbalance no longer holds true (i.e., the price breaks through the box), the box is marked as "broken." If disabled, the box is deleted when the imbalance condition no longer applies.
brokenBoxColor (red): This controls the color of the box when it is broken, which can be used as a visual cue that the imbalance was invalidated or no longer valid for analysis.
2. Volume Imbalance Function
This is the core function of the script, where the logic to detect bullish and bearish volume imbalances is implemented.
Bullish Imbalance Condition:
The first condition checks if the low of the current candle is greater than the high of the previous candle. This suggests that the market is moving upward with buying pressure.
The second condition checks whether the volume of the current candle is higher than the previous candle by the volumeThreshold multiplier. If both conditions are satisfied, a bullish imbalance is detected.
Bearish Imbalance Condition:
The first condition checks if the high of the current candle is lower than the low of the previous candle. This suggests downward price action with selling pressure.
The second condition checks whether the current volume exceeds the previous volume by the threshold
Allow Wick Overlap: If allowWickOverlap is set to true, the script will still detect imbalances if the wicks of the two candles overlap (common in volatile markets). If false, imbalances are only considered if the wicks do not overlap.
3. Box Creation and Management
When a volume imbalance is detected, the script creates a box on the chart:
The bullish imbalance box is drawn using the minimum of the open and close of the current bar as the top boundary and the maximum of the open and close of the previous bar as the bottom boundary.
Conversely, the bearish imbalance box is drawn in reverse, using the maximum of the current bar’s open and close as the top boundary and the minimum of the previous bar’s open and close as the bottom boundary.
Once the box is created, it is displayed on the chart with the specified background color, border color, and width.
4. Processing Existing Boxes
After detecting a new imbalance and drawing a box, the script checks whether the box should still remain on the chart:
If the price moves beyond the boundaries of the imbalance box, the box is marked as broken (if showBrokenBoxes is enabled), and its color is changed to red, signifying that the imbalance is no longer valid.
If the box remains intact (i.e., the price has not broken the defined boundaries), the script keeps the box extended to the right as the market continues to evolve.
5. Removing Outdated Boxes
Lastly, the script removes boxes that are older than the specified lookback period. For example, if a box was created 250 bars ago, it will be deleted after that period. This ensures the chart stays clean and only focuses on relevant imbalances.
Why This Script is Useful for Traders
This script is extremely valuable for traders, especially those following the ICT methodology, because it automates the process of detecting market inefficiencies or imbalances that might signal future price action. Here’s why it’s particularly useful:
Identifying Key Areas of Interest: Volume imbalances often point to areas where institutional or large-scale traders have entered the market. These areas could provide clues about the next significant move in the market.
Visualizing Market Structure: By automatically drawing boxes around volume imbalances, the script helps traders visually identify potential areas of support, resistance, or turning points, enabling them to make informed trading decisions.
Time Efficiency: Instead of manually analyzing each candlestick and volume spike, this script does the heavy lifting, saving traders valuable time and allowing them to focus on other aspects of their strategy.
Enhanced Trade Entries and Exits: By understanding where volume imbalances are occurring, traders can time their entries (buying during bullish imbalances and selling during bearish ones) and exits (as imbalances break) more effectively, thus improving their chances of success.
Conclusion
In summary, this script is a powerful tool for traders looking to implement volume imbalance strategies based on the ICT methodology. It automates the identification and visualization of significant imbalances in price and volume, offering traders a clear visual representation of potential market turning points. By customizing the settings, traders can tailor the script to their preferred timeframes and sensitivity, making it a flexible and effective tool for any trading strategy.
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ARTA Trader Tool (Free)ARTA Trader Tool (FREE Version) is a powerful short-term trend indicator designed for optimal performance on the 1-minute timeframe. It works seamlessly during both the London and New York trading sessions, helping traders identify trends with precision and efficiency.
