The No Lag Crossover Scalper aims to capitalize on short-term trends using a combination of Hull Moving Average (HMA) for trend detection and multiple indicators for generating buy and sell signals. Here’s an overview of its components and approach:
1. Trend Detection with Hull Moving Averages (HMA):
- Dual Hull MA Setup: Uses two Hull Moving Averages (HMA) to detect crossovers and crossunders, which are signals of short-term trend changes.
- No Lag Nature: HMAs are chosen for their ability to reduce lag compared to traditional moving averages, providing quicker responses to price movements.
2. Indicators for Signal Generation:
- Relative Strength Index (RSI): Detects overbought and oversold conditions, generating signals when price movements diverge from RSI readings.
- Moving Average Convergence Divergence (MACD): Provides signals based on the convergence and divergence of two moving averages, indicating potential trend reversals.
- Stochastic Oscillator (Stoch): Identifies momentum shifts by comparing the current closing price to its range over a specific period.
- On-Balance Volume (OBV): Measures buying and selling pressure based on volume flow, signaling potential changes in price direction.
- RSI Divergence: Looks for discrepancies between price action and RSI values, suggesting weakening trends and possible reversals.
3. Signal Generation Logic:
- Buy Signals: Generated when both HMAs cross over, supported by bullish indications from RSI, MACD, Stoch, OBV, or RSI divergence. At least 2 indicators must be true to generate a signal.
- Sell Signals: Triggered when HMAs cross under, complemented by bearish signals from the mentioned indicators.
4. Implementation and Optimization:
- Parameter Optimization: Fine-tuning of indicator periods and sensitivity settings to balance signal accuracy and responsiveness.
- Confirmation Mechanisms: Use of multiple indicators to confirm signals, reducing false positives and enhancing reliability.
Overall, the No Lag Crossover Scalper combines the speed of Hull Moving Averages with the reliability of multiple indicators to identify short-term trends effectively. By focusing on no lag indicators and confirming signals with diverse technical tools, it aims to capitalize on rapid market movements while managing risk through disciplined execution.
Credits: used TradingView ta library for a lot of the built-in indicators.
Disclaimer: This is still experimental beta version so use at your own risk.