The comment of sal157011 Jul 30 is correct. Unfortunately, the interpretation of RWI (as in the indicated URL) is incomplete and limited.
RWIL and RWIH can both be greater than one. They also can be negative. So, for example if RWIL=3 and RWIL=2 what does that mean? Uptrend and downtrend at the same time?
Tom1trader
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Finally got around to puclishing this. I uses your function and this indicator of yours gave me the idea and informed that such a thing as a Random Walk Index exists. Thanks a million and keep smiling!
Thanks again for sharing this and the idea, I used your function added to my Williams percentR. Have been trading with it and like it and very soon to publish will link here very soon. Could append to any panel indicator, added 2 wide lines at top of panel, the top is Random Walk Index short period (default 4) with a adjustable filter (default 1) for threshold colors red green and white for threshold reached down/up or threshold not met. Second line is Aqua Fuchsia to stand out from the background colors of the Williams for up down crosses changes color where your signals appear. This (any version) indicator gives an interpretation from a different perspective. I find it valuable and it is part of my normal mix for trading. Thanks so much again for publishing this to give me the idea! (Plus it is fun making them work is it not?) Keep smiling!
RicardoSantos
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@Tom1trader, an indicator is just that interpretation of a angle of insight into the data trying to remove some noise, yes it is, thx for the feedback.
Tom1trader
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@RicardoSantos, "Angle of insight". Exactly, good wording and thanks again for your examples and script ideas, keep smiling!
sal157011
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I think you totally miss the point of this indicator and it seems that the code is wrong.
The most important poinst are the 1 boundary for the RWIl and theRWIh and the -1 and +1 boundaries for the RWI.
If RWIl or RWIh are greater than 1, means there is trend and not random walk, trend up if it is the RWIh and down if it is the RWlI.
I think my implementation of this indicator is the right one, but I don't know much, there is little information about it on the internet,but I've found this:
books.mec.biz/downloads/Detecting_Trend_Direction_And_Strength/NjQxNDI4NzM2 tradingview.com/script/eXHlEXzw-Random-Walk-Index-RWI-RWIhi-RWIlo/
RicardoSantos
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@sal157011, your implementation is basically the same as mine except for the usage of atr() when i call range as (high-low) and the implementation of the rwi line, besides your loop is not doing anything it always returns the value at the last loop in this case the max_period ;).
so we can say that both implementations should be somewhat correct in a way, lol :p
Tom1trader
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Nice job! Had not heard of this one, breaks down recent price action very well. Coordinates well with Force Index and/or %R to see if price action and volume working together or not. Thanks!
RWIL and RWIH can both be greater than one. They also can be negative. So, for example if RWIL=3 and RWIL=2 what does that mean? Uptrend and downtrend at the same time?