Synthetic Vix Stochastic — Indicateur par ShirokiHeishi

I noticed that this indicator was not in the public library, so I decided to share it. This is Larry Williams take on stochastics, based on his idea of synthetic vix. Thanks to Active trader magazine, his article on the idea shows us how this tool can be used as a timing instrument for his sythetic vix. The idea he relates is that the market becomes oversold at the height of volatility and the stochastic can highlight the periods when the panic may be over. This is evidenced by readings above 80 and below 20. He states that his indicator is less reliable at market tops rather than bottoms, and evidence suggests just that. Stochastics readings in this indicator have been adjusted to look and 'feel' like traditional readings. His suggested settings are the default, but I have included a more traditional line in the code that reads the WVF high and low in the calculation instead of just the WVF, just uncomment the appropriate lines and see for yourself. This indicator works really well with the Williams Vix Fix, inverted of course, coded by ChrisMoody.
Enjoy responsibly
ShirokiHeishi
see the notes on chart

Script open-source

Dans le véritable esprit de 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 le règlement. Vous pouvez le mettre en favori pour l'utiliser sur un graphique.

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Vous voulez utiliser ce script sur un graphique ?

//@version=2
//Author: ShirokiHeishi 
//Idea by Larry Williams, on his Synthetic vix formula based on the article in 
//ACTIVE TRADER www.activetradermag.com • December 2007 • pgs 24-32
//in his article he suggests that readings above 80 and below 20 are potential bottoming and topping zone.
study(title="Stochastic", shorttitle="WVF_Stoch")
//inputs
//Larry recommended 22 periods for the lookback
//Larry recommended 14 periods for the stochastic
pd = input(22, title="WVF lookback period")
length  = input(14, minval=1)
smoothK = input(1, minval=1)
smoothD = input(3, minval=1)
OB      = input(80, title="Topping Zone")
OS      = input(20, title="Bottoming Zone")
//definitions
//this inverts the output for a more tradional look to the Stochastics
wvf = ((highest(close, pd)-low)/(highest(close, pd)))* -1
vfh = highest(wvf,pd)
vfl = lowest(wvf,pd)
//Larry's original formula as recorded in the article
//WVF = (highest (close,22)- low)/(highest(close,22))*100
//uncomment for a more traditional reading similar to standard stochastics
// k   = sma(stoch(wvf, vfh, vfl, length), smoothK) 
k   = sma(stoch(wvf, wvf, wvf, length),smoothK)
d   = sma(k, smoothD)
// outputs
plot(k, color=white, transp=0, linewidth=2)
plot(d, color=maroon, transp=0, linewidth=2) 
h0 = hline(OB, linestyle=dotted, color=maroon, title="Potential Topping Zone")
h1 = hline(OS, linestyle=dotted, color=teal, title="Potential Bottoming Zone")