OPEN-SOURCE SCRIPT
Relative Strength with 3 SMA
Mansfield RS with 3 SMAs
Overview
The Mansfield Relative Strength (RS) indicator with three Simple Moving Averages (SMAs) enhances traditional RS analysis by adding more clarity and precision to trend identification. This personalized version aims to define RS trends more clearly and end them sooner, helping traders make better-informed decisions.
Key Features
Relative Strength Calculation:
Comparison: Calculates the RS of a chosen symbol against a benchmark (default: S&P 500).
Normalization: Uses the stock’s closing price divided by the closing price of the benchmark over a specified period.
Three SMAs:
Periods: Configurable periods for three SMAs (default: 10, 20, 50).
Trend Smoothing: SMAs help smooth the RS line, making it easier to spot trends and potential reversals.
Visualization:
Area Plot: The RS line is displayed as an area plot.
Color Coding: Different colors for each SMA to distinguish them easily (yellow, orange, purple).
Customization Options:
Comparative Symbol: Choose any benchmark symbol.
Period Adjustment: Customize the periods for both the RS calculation and the SMAs.
Visibility: Option to show or hide the SMAs.
How to Use
Setup:
Add to Chart: Apply the indicator to your TradingView chart.
Customize: Adjust the comparative symbol, RS period, and SMA periods as per your preference.
Interpretation:
Rising RS Line: Indicates the stock is outperforming the benchmark.
Falling RS Line: Suggests underperformance.
SMA Crossovers: Watch for the RS line crossing above or below the SMAs to signal potential buy or sell points.
Trend Direction: SMAs help confirm the trend direction. A rising RS line above the SMAs indicates a strong relative performance.
Trading Strategy:
Trend Confirmation: Use SMA crossovers to confirm trends.
Divergence: Identify divergences between the price action and the RS line for potential reversal signals.
Overview
The Mansfield Relative Strength (RS) indicator with three Simple Moving Averages (SMAs) enhances traditional RS analysis by adding more clarity and precision to trend identification. This personalized version aims to define RS trends more clearly and end them sooner, helping traders make better-informed decisions.
Key Features
Relative Strength Calculation:
Comparison: Calculates the RS of a chosen symbol against a benchmark (default: S&P 500).
Normalization: Uses the stock’s closing price divided by the closing price of the benchmark over a specified period.
Three SMAs:
Periods: Configurable periods for three SMAs (default: 10, 20, 50).
Trend Smoothing: SMAs help smooth the RS line, making it easier to spot trends and potential reversals.
Visualization:
Area Plot: The RS line is displayed as an area plot.
Color Coding: Different colors for each SMA to distinguish them easily (yellow, orange, purple).
Customization Options:
Comparative Symbol: Choose any benchmark symbol.
Period Adjustment: Customize the periods for both the RS calculation and the SMAs.
Visibility: Option to show or hide the SMAs.
How to Use
Setup:
Add to Chart: Apply the indicator to your TradingView chart.
Customize: Adjust the comparative symbol, RS period, and SMA periods as per your preference.
Interpretation:
Rising RS Line: Indicates the stock is outperforming the benchmark.
Falling RS Line: Suggests underperformance.
SMA Crossovers: Watch for the RS line crossing above or below the SMAs to signal potential buy or sell points.
Trend Direction: SMAs help confirm the trend direction. A rising RS line above the SMAs indicates a strong relative performance.
Trading Strategy:
Trend Confirmation: Use SMA crossovers to confirm trends.
Divergence: Identify divergences between the price action and the RS line for potential reversal signals.
Script open-source
Dans le plus pur esprit TradingView, l'auteur de ce script l'a publié en open-source, afin que les traders puissent le comprendre et le vérifier. Bravo à l'auteur! Vous pouvez l'utiliser gratuitement, mais la réutilisation de ce code dans une publication est régie par nos Règles. Vous pouvez le mettre en favori pour l'utiliser sur un graphique.
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