Multi-Divergence Indicator for Think or Swim: MACD, RSI, CCI, On Balance Volume and many more

January 11, 2015

whatitlookslikenew

I figured out a way to combine all my divergence indicators into one single study. The new Multi-divergence script uses slopes of linear regression lines just like in the new MACD divergence indicator. This script supersedes all the other divergence scripts. The difference is now it can perform a regression on any one study of your choice from a list of ToS indicators. The indicators currently supported for divergence analysis are:

MACD, RSI, CCI, Momentum, Moneyflow, On Balance Volume, Rate of Change, Stochastic Momentum Index, Ultimate Oscillator, Volume Flow Indicator, Volume Oscillator, Volume Rate of Change, Volume-Weighted MACD, Williams Percent-R, and Woodie’s CCI

(Note that it doesn’t scan all of these for divergence at once. Just the one indicator you select. If you want to have RSI and MACD at the same time for example, you put the script on your chart twice and select the appropriate indicator for each one separately.)

If there is another built-in ToS indicator you want to have available for divergence analysis, let me know and I can add it in future updates. You can use the Multi-divergence indicator on real time charts and in scans of watch lists, and I put in alert logic so it can ping you when a divergence occurs.

This indicator is for blog donors only.  You can find it on my google site under Released Thinkscript Studies down in the Donors Only section. If you already donated in the past you can use your password to access it. If you want to become a donor (or throw me some more coin) you can do so by clicking the Donate button:

As always, if you are a DIY’er, feel free to ask questions in the comments and I’ll help answer.

Complex Analysis Tool (CAT): Analyzing and Recording Think or Swim RTD Data in Excel

December 19, 2014

I just updated the stock Excel CAT tool to use RTD instead of the now defunct DDE. This only works on Excel for Windows unfortunately. You can go download it now from my Google Site under Released Tools in the Donors Only folder. If you already donated in the past you can use your password to access it. If you want to become a donor (or throw me some more coin) you can do so by clicking the Donate button:

If you want to learn more about the CAT, the original blog entry is found here.

UPDATE: MACD Divergence Indicator for Think or Swim

December 10, 2014

This indicator has been updated!  See the new post here.

This has been a long time in coming.  My family life has been in upheaval for a couple years now.  I finally had a bit of time so I wanted to get this done.  Thanks for staying with me.

Many people have asked for a version of the MACD Divergence Indicator that can run in a scan.  The old one I had ran on recursive logic and so wasn’t supported in scans.  This new one uses a different philosophy that runs in real time.  Before I would use my Swing Points and check the value of the MACD against them.  Higher swing highs and lower corresponding values of MACD on those bars would signal a bearish divergence.  Now I am using Linear Regression slopes to compare divergences.  Here’s the theory of how it works:

A linear regression is a way to fit a straight line through some data such that you get the least amount of average distance from the line. If the slope of the linear regression is up, then values are generally trending upward over the set of data you put in. If the slope is negative, then the values trend downward.

So I take a linear regression of price, then get the slope of the LR, and I also take a linear regression of the standard MACD indicator and get that slope. When the price slope is positive and the MACD slope is negative, we have a bearish MACD divergence. If price slope is negative and MACD slope is positive, we have a bullish divergence. If price slope and MACD slope are the same, we have a trend continuation (up/up or down/down). This chart shows this theory in action:

howitworks

 

Here’s what my indicator actually looks like.  The small arrows are short term divergences, the larger arrows are the long term divergences.  The short and long timeframes are inputs, so you can set them at whatever you want.  This chart uses 20 and 50 as the inputs, but you can experiment with what works best for what you are trading:

whatitlookslikenew

As with all divergences, just because it is there doesn’t mean that the trend must reverse. Sometimes divergences can go on for a long time. This information is good to give you a sense that a trend might reverse, and you can plan your own entry and stop accordingly.

Now, to set set up a custom scan, you follow the instructions in these pictures:

scan1

scan2

Then when your scan runs, you will get flagged if the divergence you asked for is currently found.

This indicator is for blog donors only.  You can find it on my google site under Released Thinkscript Studies down in the Donors Only section.

DDE to RTD Conversion Status

May 3, 2014

I’m working on an update to the CAT tool that will use the new RTD components instead of the old broken DDE ones. Stay tuned for more updates on it.

DDE Status between Excel and Think or Swim

February 24, 2014

If you are a DDE user you’ve noticed that it’s broken after this latest Think Desktop update. I just got word from the developers that they are looking to release improved capability this coming weekend. Now, please remember that development estimates are just that: estimates. This weekend is the goal. Don’t burn down your local village if it doesn’t happen on time. ;)

What they have should be better than the old DDE in terms of what we could do with it. It’s not two-way interaction with ToS, so done get that excited. It’s faster and more improved data handling that should be much easier to work with and more powerful for data handling inside of Excel. I’ll update as I know more.


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