REQ Help with Trend Indicator

[jjthetrader 10]

Hi all, I'm trying to recreate an indicator for TradeStation from a program I have called tradeguider. They call it 'the diamond indicator' which is basically a moving average. That much I can handle. But the 'diamonds' change colour signaling a change in short term trend. Red is a downtrend, white signals a possible reversal and green is up.

I was just wondering if anyone knew the criteria for this change? It appears to be some kind of crossover signal but the folks at tradeguider say that's not it.

If anyone has any theories I'd love to hear them. If not, thank you for your time.

 

 

 

 

This guy seems to have ripped it off nicely at hawkeyetraders:

[Blu-Ray 10]

jj

 

If you've got the program, try and see if can edit the indicator, so it displays the formula.

 

If you can do that, post it here or PM me and I'll have a go.

 

Cheers

 

Blu-Ray

[jjthetrader 10]

Hi, it's built right into the program so I can't see anything. I can overlay a moving average and that seems to be what it follows but I'm looking for it's color changing criteria cause they seem to be pretty accurate.

 

I tried If Close < Avg then red and the same for green but this only matches up about 80%. It's the white ones I'm interested in because they are supposed to be "possible trend reversal".

 

I could just use tradeguider but I like having everything in Tradestation to keep it all in one window and to be able to incorporate into a strategy if I feel inclined.

 

I thought maybe someone on this forum might have some experience with tradeguider and know it's ins and outs.

 

Thanks

JJ

[Blu-Ray 10]

I could just use tradeguider but I like having everything in Tradestation to keep it all in one window and to be able to incorporate into a strategy if I feel inclined.

 

 

Thanks

JJ

 

Yeh I know what you mean as I feel the same when trying different platforms, it might be worth shooting them an email asking if they could explain how it works.

 

 

Cheers

 

Blu-Ray

[jjthetrader 10]

Thanks, will do. This company is pretty tight lipped. It's "proprietary" etc. they say. It's one of their software's claim to fame.

cheers,

JJ

[jjthetrader 10]

For anyone who cares, the solution to this dilema I posted is just the location of the open and close in relation to a very short moving average and in relation to that same relationship one day ago. If you look at the pics above you will see this.

So trageguider is correct that it's not a crossover system.

I haven't coded it out yet but I can see the logic now.

[gassah 10]

If you are willing to share the TS code I'm interested. Thanks.

 

Rob

[jjthetrader 10]

If you are willing to share the TS code I'm interested. Thanks.

 

Rob

 

I will.....after the trading day on the weekend sometime.

[gassah 10]

Hey JJ,

 

Here's my email to talk about the indicator if you don't mind. rob-nicholas@cox.net Thanks.

 

gassah

[jjthetrader 10]

Hey JJ,

 

Here's my email to talk about the indicator if you don't mind. rob-nicholas@cox.net Thanks.

 

gassah

 

Right, sorry I forgot all about this. I'll get on it, it's on my laptop so as soon as I have it running I'll post. If you'd like to discuss it please feel free to PM me.

JJ

[jjthetrader 10]

I only found my basic 'diamond indicator' but I will explain to you what you need to do in order to complete it.

 

Here's it's basic background. TGuider uses a 5 period MA as it's default. You can change this for quicker responses in immediate trend changes.

 

Logic:

If Price closes below the MA a red dot will paint in TSation.

If Price closes above the MA a green dot will paint.

 

That's the basis of it. But there is a little twist that gives you the warning of a possible trend change and that is the white diamond.

Here's how the white diamond works. You'll have to code this part in but not to worry it's very simple.

 

If you're in a downtrend, closing below the MA then all of a sudden you get a close above the MA, that would paint you a white diamond. If price then reversed and closed below the MA on the following bar, this would also be a white diamond.

 

In order for either the red or green dot to paint, it will need to be the second close on that side of the MA since the first will be white.

 

Are you following? Good.

 

It's as simple as that. Here's the basic code for just red and green dots. You'll have to put in the extra conditions for the white (possible change in trend coming) dots.

 

inputs: Price( Close ), Length( 4 ), Displace( 0 ) ;

variables: Avg( 0 ) ;

 

Avg = AverageFC( Price, Length ) ;

 

if Displace >= 0 or CurrentBar > AbsValue( Displace ) then

begin

 

If Close < Avg then

begin

Plot1( Avg , "Avg", Red );

end

else

begin

Plot1 (Avg , "Avg", Green);

end;

 

 

 

 

 

{ Alert criteria }

if Displace <= 0 then

begin

if Price crosses over Avg then

Alert( "Price crossing over average" )

else if Price crosses under Avg then

Alert( "Price crossing under average" ) ;

end ;

end ;

 

Good Luck!

[deeznutzca 10]

Thanks for sharing!

[Blu-Ray 10]

Thanks JJ

 

 

I've coded it up to include the white crosses as well into the attached ELD.

 

Cheers

 

Blu-Ray

DIAMOND_TREND.ELD

[jjthetrader 10]

Blu-Ray, that's awesome! Thanks for coding it up for everyone.

Crosses are what I preferred as well.

 

TGuider also has an intermediary trending system. It's based on volatility bands. If you close above the bands your bars turn green, below the bands they turn red. You match this sytem up with your diamonds and you've got a clear trend direction. I haven't spent a lot of time trying to reproduce them because I do most of my trading now with TGuider and less with TrdeStation.

[MC 10]

Thanks JJ

 

 

I've coded it up to include the white crosses as well into the attached ELD.

 

Cheers

 

Blu-Ray

 

:cool:

Thanks a ton.

[val2004 10]

hi

Is it possible to have the code in txt format for ts2000i

 

Thanks a lot

[Blu-Ray 10]

hi

Is it possible to have the code in txt format for ts2000i

 

Thanks a lot

 

 

Here you go:

 

 

inputs: Price( Close ), Length( 5 ),Upcolor( DarkGreen),DnColor ( DarkRed),NColor(White) ;
variables: Avg( 0 ) ;

Avg = AverageFC( Price, Length ) ;

Condition1 = close[1] > avg[1] and close > avg;
Condition2 = close[1] < avg[1] and close < avg;

plot1(avg,"avg");

if close crosses above avg then setplotcolor(1,NColor);
if condition1 then setplotcolor (1,upcolor);
if close crosses below avg then setplotcolor(1,NColor);
if condition2 then setplotcolor (1,dncolor);

 

Hope this helps

 

Blu-Ray

[val2004 10]

thanks a lot Blue ray .

[BlowFish 10]

I Think there's more to it than that. Just after 9.30 there are 2 white despite 2 closes below. 11.30 & 12.15 you get red to green and green to red with no white. Have I missed something?

 

Cheers.

[BlowFish 10]

AHh I think I see what's missing!

 

If the MA goes from down to up then it goes red to green immediately. If it is still down but close is above then it will go white.

[Blu-Ray 10]

AHh I think I see what's missing!

 

If the MA goes from down to up then it goes red to green immediately. If it is still down but close is above then it will go white.

 

 

Yes I think that's it, I'll recode it up tomorrow

 

Cheers

 

Blu-Ray

[gassah 10]

Thanks a lot guys for the help.

 

gassah

[Blu-Ray 10]

Here's a revised version, using BlowFish's observations, I've compared it with the original picture JJ posted at the start of the thread. It's very close to Traderguiders version using, as you can see on the charts below, there are 3 rogue dots. So the code might not be exact, but this could be down to different platforms handling different data.

 

 

 

 

Here's the code for it.

 

inputs: Price( Close ), Length( 5 ),Upcolor( DarkGreen),DnColor ( DarkRed),NColor(White) ;
variables: Avg( 0 ) ;

Avg = average( Price, Length ) ;

Condition1 = Close >= avg and avg >= avg[1]; { Green Dots }
Condition2 = Close < avg and avg > avg[1]; { White Dots }
Condition3 = Close <= avg and avg <= avg[1]; { Red Dots }
Condition4 = Close > avg and avg < avg [1]; {White Dots }

plot1(avg,"avg");

if Condition1 then setplotcolor (1,Upcolor);
if Condition2 then setplotcolor (1,Ncolor);
if Condition3 then setplotcolor (1,Dncolor);
if Condition4 then setplotcolor (1,Ncolor);

 

Hope this helps

 

Blu-Ray

Diamond_Trend.ELD

[Dogpile 10]

hi guys...

 

I have been working on something similar so thought I would chime in...

 

rather than have the indicator follow price as in a close relative to a moving average, personally I find it more useful to compute a price in advance that signals a 'reversal' if touched. Thus you can see a 'mechanical trigger point' in advance rather than having to wait for a bar to close. I realize this is really only a minor difference in what you are doing but thought I would throw this in anyway.

 

Linda Rashke just did a presentation using her own indicator here:

https://lbrgroup.com/images//BloombergChicagoNovember2007/bloomberg.pdf

 

her indicator paints the bar depending on where the current bar closes relative to the trailing 16 bar high/low. thus, if in a downtrend -- the bar would be red and switch to green on any close that is above the 16-bar low +2.5 avgtruerange's --- she uses: avgtruerange(9), btw.

 

I have played around these settings and like 1.5 true ranges better and like computing a price in advance rather than waiting for the bar close -- you can use buy and sell stops to enter when you have the computed price in advance.

 

Here is an example:

 

[Blu-Ray 10]

That looks very interesting Dogpile, thank you for introducing us to that, would you mind sharing your code for the indicator at all?

 

Cheers

 

Blu-Ray