Mean Trend Oscillator

שלשום

Mean Trend Oscillator

The Mean Trend Oscillator offers an original approach to trend analysis by integrating multiple technical indicators, using statistic to get a probable signal, and dynamically adapting to market volatility.

This tool aggregates signals from four popular indicators—Relative Strength Index (RSI), Simple Moving Average (SMA), Exponential Moving Average (EMA), and Relative Moving Average (RMA)—and adjusts thresholds using the Average True Range (ATR). By using this, we can use Statistics to aggregate or take the average of each indicators signal. Mathematically, Taking an average of these indicators gives us a better probability on entering a trending state.

By consolidating these distinct perspectives, the Mean Trend Oscillator provides a comprehensive view of market direction, helping traders make informed decisions based on a broad, data-driven trend assessment. Traders can use this indicator to enter long spot or leveraged positions. The Mean Trend Oscillator is intended to be use in long term trending markets. Scalping MUST NOT be used with this indicator. (This indicator will give false signals when the Timeframe is too low. The best intended use for high-quality signals are longer timeframes).

The current price of a beginning trend series may tell us something about the next move. Thus, the Mean Trend Oscillator allows us to spot a high probability trending market and potentially exploit this information enter long or shorts strategy. (again, this indicator will give false signals when the Timeframe is too low. The best intended use for high-quality signals are longer timeframes).

Concept and Calculation and Inputs
The Mean Trend Oscillator calculates a “net trend” score as follows:

1. RSI evaluates market momentum, identifying overbought and oversold conditions, essential for confirming trend direction.
   
2. SMA, EMA, and RMA introduce varied smoothing methods to capture short- to medium-term trends, balancing quick price changes with smoothed averages.
   
3. ATR-Enhanced Thresholds: ATR is used as a dynamic multiplier, adjusting each indicator’s thresholds to current volatility levels, which helps reduce noise in low-volatility conditions and emphasizes significant signals when volatility spikes.
   
4. Length could be used to adjust how quickly each indicator can more or how slower each indicator can be.
   
5. Time Coherency for Inputs: Each indicator must be calculated where each signal is relatively around the same area.
   

For example:

Simply:
SMA, RMA, EMA, and RSI enters long around each intended trend period. Doesn't have to be perfect, but the indicators all enter long around there.

Each indicator contributes a score (+1 for bullish and -1 for bearish), and these scores are averaged to generate the final trend score:

• A positive score, shown as a green line, suggests bullish conditions.
  
• A negative score, indicated by a red line, signifies bearish conditions.
  
• Thus, giving us a signal to long or short.
  

How to Use the Mean Trend Oscillator
This indicator’s output is straightforward and can fit into various trading strategies:

• Bullish Signal: A green line shows that the trend is bullish, based on a positive average score across the indicators, signaling a consideration of longing an asset.
  
• Bearish Signal: A red line indicates bearish conditions, with an overall negative trend score, signaling a consideration to shorting an asset.
  

By aggregating these indicators, the Mean Trend Oscillator helps traders identify strong trends while filtering out minor fluctuations, making it a versatile tool for both short- and long-term analysis. This multi-layered, adaptive approach to trend detection sets it apart from traditional single-indicator trend tools.