Swing Point Oscillator with Trend Filter [Quantigenics]

23 באוג׳ 2023

The "Swing Point Oscillator with Trend Filter" is a sophisticated trading oscillator designed to enhance trading decisions by adapting to market conditions. Oscillators typically signal overbought/oversold market states, often yielding false signals in strong trends. This trend indicator addresses this by implementing a 'Trend Filter' which changes color in strong trends, alerting traders to avoid typical oscillator reversals. In strong trends (when the trend Filter is red), mid-high or mid-low levels can be used for pullback entries. In more neutral markets (when the trend Filter is close to blue), extreme high and low levels (top and bottom) can be used, as a true 'over bought / over sold' oscillator. The oscillator combines components of the Stochastic Oscillator and the CCI, then normalizes the result, providing a unique, adaptive signal. The color-coded lines and Trend Filter offer clear visual cues, making this a comprehensive tool for various market scenarios.

Caution: Always use the indicator in conjunction with other tools and analysis methods to confirm trading decisions. Avoid trading solely based on this indicator.


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How to Use:

1. Swing Point Oscillator: Displays the momentum of the price relative to its recent high and low.
   
2. Trend Filter: Highlights the general direction of the market trend.
   
3. Zones: Visual representation to categorize oscillator values (Up Zone and Down Zone).
   

Interpretation:

Oscillator:

• When the oscillator moves upward and approaches or enters the Up Zone, it indicates increasing bullish momentum.
  
• When the oscillator moves downward and approaches or enters the Down Zone, it suggests increasing bearish momentum.
  
• Values near the middle (around zero) often indicate indecision or consolidation in the market.
  

Trend Filter:

• A trend filter line above the Mid-High or below the Mid-Low suggests a strong trend.
  
• When the trend filter is between the Mid-High and Mid-Low, it might indicate a weaker or sideways trend.
  
• Its color will change based on its position relative to the zones. For instance, it turns red when indicating a stronger trend.
  

Zones:

• Up Zone: The area between the Top Line and the Mid-High. Indicates strong bullish momentum when the oscillator is within this zone.
  
• Down Zone: The area between the Mid-Low and the Bottom Line. Indicates strong bearish momentum when the oscillator is in this zone.
  

Trading Tips:

• Bullish Scenario: Consider long positions when the oscillator is rising, and the trend filter indicates a strong upward trend.
  
• Bearish Scenario: Consider short positions when the oscillator is falling, and the trend filter indicates a strong downward trend.