OPEN-SOURCE SCRIPT
Candlestick Pattern Strategy with RSI, MACD, and Moving Averages
This script combines powerful candlestick patterns with key indicators (RSI, MACD, and Moving Averages) to provide strong, reliable signals for options trading or general trading. By analyzing multiple conditions, it reduces false signals and provides trade recommendations only when the candlestick patterns align with the overall trend and momentum.
Key Features:
Candlestick Patterns:
Hammer: Signals a bullish reversal when it appears at the bottom of a downtrend. This pattern suggests that buyers are stepping in to push the price up.
Shooting Star: Signals a bearish reversal when it appears at the top of an uptrend, indicating that sellers have taken control.
Indicators Used:
Moving Averages (SMA): Uses a short-term (9-period) and a long-term (21-period) SMA to identify the overall trend. A bullish trend is confirmed when the short SMA is above the long SMA, and a bearish trend when the short SMA is below the long SMA.
Relative Strength Index (RSI): A momentum indicator. Bullish signals are confirmed when the RSI is above 50, indicating positive momentum, and bearish signals when the RSI is below 50.
MACD: A trend-following indicator. Bullish signals are confirmed when the MACD line is above the Signal line, and bearish signals when the MACD line is below the Signal line.
How It Works:
Bullish Signal (Call): Generated when a Hammer pattern appears, the short SMA is above the long SMA, RSI is above 50, and the MACD line is above the Signal line. This indicates a high-probability uptrend, making it a good time to consider a Call option.
Bearish Signal (Put): Triggered when a Shooting Star pattern appears, the short SMA is below the long SMA, RSI is below 50, and the MACD line is below the Signal line. This indicates a high-probability downtrend, making it a good time to consider a Put option.
Visual Cues:
Arrows on the chart indicate buy (Call) or sell (Put) signals based on the pattern.
Background color changes to green or red depending on the bullish or bearish conditions, helping you quickly spot trends.
Text labels for "CALL OPTION," "PUT OPTION," or "NO SIGNAL" are added to each bar for additional clarity.
Use Cases: This strategy is suitable for:
Options Traders: Helps in identifying high-probability Call or Put scenarios based on trend and momentum.
Trend Followers: Allows traders to enter the trend with confirmation, reducing the likelihood of false signals.
Swing Traders: Effective for identifying reversals at key levels, supported by additional indicators.
Disclaimer: This script is for educational purposes only and should not be considered financial advice. Always perform your own research and backtest strategies before trading with real funds. Market conditions can vary, so it’s essential to adjust the parameters and use risk management practices.
Key Features:
Candlestick Patterns:
Hammer: Signals a bullish reversal when it appears at the bottom of a downtrend. This pattern suggests that buyers are stepping in to push the price up.
Shooting Star: Signals a bearish reversal when it appears at the top of an uptrend, indicating that sellers have taken control.
Indicators Used:
Moving Averages (SMA): Uses a short-term (9-period) and a long-term (21-period) SMA to identify the overall trend. A bullish trend is confirmed when the short SMA is above the long SMA, and a bearish trend when the short SMA is below the long SMA.
Relative Strength Index (RSI): A momentum indicator. Bullish signals are confirmed when the RSI is above 50, indicating positive momentum, and bearish signals when the RSI is below 50.
MACD: A trend-following indicator. Bullish signals are confirmed when the MACD line is above the Signal line, and bearish signals when the MACD line is below the Signal line.
How It Works:
Bullish Signal (Call): Generated when a Hammer pattern appears, the short SMA is above the long SMA, RSI is above 50, and the MACD line is above the Signal line. This indicates a high-probability uptrend, making it a good time to consider a Call option.
Bearish Signal (Put): Triggered when a Shooting Star pattern appears, the short SMA is below the long SMA, RSI is below 50, and the MACD line is below the Signal line. This indicates a high-probability downtrend, making it a good time to consider a Put option.
Visual Cues:
Arrows on the chart indicate buy (Call) or sell (Put) signals based on the pattern.
Background color changes to green or red depending on the bullish or bearish conditions, helping you quickly spot trends.
Text labels for "CALL OPTION," "PUT OPTION," or "NO SIGNAL" are added to each bar for additional clarity.
Use Cases: This strategy is suitable for:
Options Traders: Helps in identifying high-probability Call or Put scenarios based on trend and momentum.
Trend Followers: Allows traders to enter the trend with confirmation, reducing the likelihood of false signals.
Swing Traders: Effective for identifying reversals at key levels, supported by additional indicators.
Disclaimer: This script is for educational purposes only and should not be considered financial advice. Always perform your own research and backtest strategies before trading with real funds. Market conditions can vary, so it’s essential to adjust the parameters and use risk management practices.
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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