This script tries to estimate how inclined may retail traders be to open a position based on popular indicators RSI, Stochastic, Ichimoku, Bollinger Bands, MACD, and 200 EMA. Conditions are:
Plus values • RSI above 70 • %K above 70 or even • Conversion line above baseline and price above the cloud • High above the upper band • MACD above the signal line
Each condition gives 1 point if true or 2 points if it is also above 200 EMA
Minus values • RSI below 30 • %K below 30 or even • Conversion line below baseline and price below the cloud • Low below the upper band • MACD below the signal line
Each condition gives -1 point if true or -2 points if it is also below 200 EMA
I still consider the script as in development, so if you have some ideas on how it could be improved or traded, let me know.
I have a question, why do you compare the low to be above 200 ema ( or hight to be below the ema ) instead of close? Thanks
OrcChieftain
⋅
@decentMeerkat007, to avoid awarding too much extra points when it is crossing/consolidating and it is unclear if it goes above.
decentMeerkat007
⋅
@greenmask9, Thanks, i guess I am trying to see if this can be useful to have some sort of a consolidated 'signal' and could potentially add more signals to the mix. I am yet to come up with an idea but thinking along those lines. Not sure if makes any sense.
OrcChieftain
⋅
@decentMeerkat007, Good luck finding out. This indicator started as an idea I liked but never continued the development. Maybe if you get the idea, I can make some new additions.
MillionRich
⋅
Thanks a lot for your excellent script :)
Pratik_4Clover
⋅
Interesting idea, so if I understand this right, +10 is extreme position where retail may open new longs and -10 is extreme position where retail may open new shorts?
OrcChieftain
⋅
@Pratik_4Clover, Its more that the indicator traders have already opened.
Pratik_4Clover
⋅
@greenmask9, Understood, lovely work. Thank you :)
OrcChieftain
⋅
@Pratik_4Clover, It will need some work. Anyway, the original thought is that either, the market will reverse only to reverse back, burst retail positions, and then go in their direction and that when all of them opened the position, there is no one left to continue the move.
Condition 'High above the upper band' goes a little against that logic and I would replace it with the bar patterns in the unforeseeable future.
Pratik_4Clover
⋅
@greenmask9, Will certainly look forward to it! Thanks again.