is shown as histogram :
- light silver bars = price is under thresold but still no trend, be patient.
- strong gray bars = prepare to enter the trade soon
- blue bars = price momentum so ride the trend
- yellow bars = do not trade (price reverts or consolidates)
Background color/bottom area based on DI+/DI- :
- green = uptrend
- red = downtrend
Top pink triangles appears when is relatively low based on "lookback" history (not based on previous static threshold) so a new trend may happens so stay alerts.
- Prepare for enter when bars turn dark gray and/or pink triangles appears.
- Enter position as soon as you see blue bar (Long or Short as indicated by the area color)
- and Exit on first yellow bar.
Quite simple, works on multiple HTF/ LTF and might be used with graphical analysis to find best opportunities.
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Disclaimer : No financial advice. Ideas & scripts are for educational purpose only, always do your own research.
I don't want to publish the source at the moment, but here is when I add the "pink triangles" showing ADX is in a strong compression (squeeze) period :
is_adx_squeeze = (adx_value == lowest(adx_value, user_lookback_bars))
So ADX is in strong compression (boolean 'is_adx_squeeze') when ADX value ('adx_value') is the lowest point for 'user_lookback_bars' (input value set by default to 30).
And the area below ADX bars is the absolute difference between DI+ and DI- values.
I don't remember where I've read about it but it was said that TV version of ADX was wrong at the time. I'm not a pro to tell which is exact, but I've searched for functions to get DI+, DI- and ADX that are used in this script. You can see them here (it was not my source but it is available in multiples scripts on TV) :
The dirmove() and adx() functions are the same as mine.
This script should have no secret for you now ;-)