Short-Term Continuation And Reversal Signals

Dec 29, 2022 | color studies, EDS, EDS code

In her article in the December 2022 issue of Stocks and Commodities, “Short-Term Continuation And Reversal Signals,” Barbara Star describes modifications to the classic directional movement indicator (DMI) and commodity channel index (CCI) that can aid in more easily identifying price reversals and continuations in a trend. Traditionally, the DMI is comprised of two lines: a positive line (+DI) and negative line (−DI).

In her article, Star creates a DMI oscillator by subtracting −DI from +DI. Historically, the DMI uses a default length of 14. In the article, this has been shortened to 10. The CCI has also been adjusted in the article to use a length of 13 instead of the usual 14 or 20. The oscillator is setup using an AIQ Color Study

The importable WinWayCharts EDS file can be obtained on request via email to info@TradersEdgeSystems.com. The code is also shown here:

! Short-Term Continuation And Reversal Signals 
! Author: Barbara Star, TASC Dec 2022 ! Coded by: Richard Denning, 10/21/2022 
C is [close]. 
H is [high]. 
L is [low]. 
H1 is valresult(H,1). 
H2 is valresult(H,2). 
L1 is valresult(L,1). 
L2 is valresult(L,2). 
GreenDMI if [DirMov] > 0. 
RedDMI if [DirMov] < 0. 
StartOfDownTrend if C < simpleavg(C,18) and [DirMov] < 0 and H < H1 and H1 > H2. 
StartOfUpTrend if C >= simpleavg(C,18) and [DirMov] >= 0 and L > L1 and L1 < L2. 
GreenTrend if C >= simpleavg(C,18) and [DirMov] >= 0. 
RedTrend if C < simpleavg(C,18) and [DirMov] < 0.

Code for the author’s color study is set up in the WinWayCharts EDS code file. Figure 7 shows the color studies set up in the charts module. Figure 8 shows the color studies on a chart of Apple, Inc. (AAPL). The black bars are potential entry points in the downtrend.

Sample Chart

FIGURE 7: WinWayCharts. The color bar setup in the charts module is demonstrated.

Sample Chart

FIGURE 8: WinWayCharts This shows an example of the color studies applied to a chart of Apple, Inc. (AAPL) with a DMI histogram and an 18-bar simple moving average.

—Richard Denning
info@TradersEdgeSystems.com
for WInWayCharts

The Slow Volume Strength Index

Sep 25, 2015 | color studies, EDS code

The WinWay EDS code based on Vitali Apirine’s June 2015 article in S&C, “The Slow Volume Strength Index,” is provided for download from the following website:
www.TradersEdgeSystems.com/traderstips.htm

!THE SLOW VOLUME STRENGTH INDEX
!Author: Vitali Aiprine, TASC April 2015
!Coded by: Richard Denning 6/10/2015
!www.TradersEdgeSystems.com

!INPUTS FOR INDICATOR:
emaLen is 6.
wilderLen is 14.

!INDICATOR FORMULAS:
ema is expavg([close],emaLen).
pDif is iff([close] – ema > 0,[volume],0).
nDif is iff([close] – ema < 0,[volume],0).

rsiLen is 2 * wilderLen – 1.
AvgU is expavg(pDif,rsiLen).
AvgD is expavg(nDif,rsiLen).
svsi is 100-(100/(1+(AvgU/AvgD))). !PLOT
The code provided for the slow volume strength index (SVSI) may be plotted as an indicator, as shown in Figure 6.

Sample Chart
FIGURE 6: WinWay TradingExpert Pro Charts. Here is the SVSI (6,14) indicator compared to the classic RSI (14).

Sample Chart
—Richard Denning
info@TradersEdgeSystems.com
for AIQ Systems

A Trading Method For The Long Haul

May 30, 2014 | color studies, EDS code, Stocks & Commodities Traders Tips, trading strategies

The AIQ code and EDS file based on Donald W. Pendergast’s article in the 2014 Bonus Issue of Stocks & Commodities, “A Trading Method For The Long Haul,” can be found at http://TradersEdgeSystems.com/traderstips.htm.
The code I provide there for the long haul system is modified somewhat from the author’s descriptions as follows. First, I did not implement the fundamental rule, but this can be done if a data source is located that can export the fundamental fields needed for each stock into a .csv file. This could then be imported into the fundamental module. Second, I modified the exit to add an RSI profit target and changed some of the exit parameters.
To get the code to run properly, the AIQALL list of stocks and groups must be installed and updated on the user’s computer. To do this, first get the most recent AIQALL list from the AIQ website, then add all the stocks from the latest data disk that have trading volume greater than about 200,000 shares. We need these in order to have enough stocks to compute the group indexes. Next, we would download data for all the stocks in the database up to the current date. Then, as shown in Figure 6, we would set the RS tickers to the AIQALL list, and also, as shown in Figure 7, recompute all dates for all the groups in the AIQALL list.
Sample Chart

FIGURE 6: AIQ DATA MANAGER. Use the AIQ Data Manager to set the RS tickers to the AIQALL list.
Sample Chart

FIGURE 7: AIQ DATA MANAGER. Use the AIQ Data Manager to compute the group & sector indexes for the AIQALL list.
The EDS file containing the code has the properties set to the AIQALL list. If you are building an EDS file directly from the code listing below, then be sure to set the properties to the AIQALL list.
!A Trading Method for the Long Haul
!Author: Donald W. Pendergast Jr., TASC Bonus Issue 2014
!Coded by: Richard Denning 3/10/14
!www.TradersEdgeSystems.com
!INPUTS:
trendLen is 200.
rsiLen is 2.
minAvgVolume is 10000.
volaLen is 21.
relStrLen is 80.
minVolaRatio is 0.5.
rsSPXmin is 1.0.
rsGroupmin is 1.0.
trailBars is 2.
rsiBuyLvl is 5.
rsiExitLvl is 95.
exitLen is 18.
C is [close].
H is [high].
L is [low].
PD is {position days}.
!LONG TERM MOVING AVERAGE:
emaLT is expavg(C,trendLen).
emaST is expavg(L,exitLen).
!RSI WILDER
!To convert Wilder Averaging to Exponential Averaging use this formula:
!ExponentialPeriods = 2 * WilderPeriod - 1.
U is C-valresult(C,1).
D is valresult(C,1)-C.
rsiLen1 is 2 * rsiLen - 1.
AvgU is ExpAvg(iff(U>0,U,0),rsiLen1).
AvgD is ExpAvg(iff(D>=0,D,0),rsiLen1).
rsi is 100-(100/(1+(AvgU/AvgD))).
!VOLATILITY
price1 is H.
price2 is L.
ratio is price1 / price2.
dp is Ln(ratio).
dpsqr is Ln(ratio) * Ln(ratio).
totdpsqr is sum(dpsqr,volaLen).
sumdp is sum(dp,volaLen).
sumdpsqr is sumdp * sumdp.
sumdpave is sumdpsqr / volaLen.
diff is totdpsqr - sumdpave.
!!use 252 for daily, or 52 for weekly below
factor is 252 / (volaLen-1).
result is sqrt(diff * factor).
vola  is result * 100 .  
volaAvg is expavg(vola,volaLen).
volaSPXavg is tickerUDF("SPX",volaAvg).
volaRatio is volaSPXavg/volaAvg.
!AVERAGE VOLUME
avgVolume is expavg([volume],50).
!RELATIVE STRENGTH
roc is C / valresult(C,relStrLen).
rocSPX is tickerUDF("SPX",roc).
rocGroup is tickerUDF(rsticker(),roc).
groupSymbol is tickerUDF(rsticker(),symbol()).
groupName is tickerUDF(rsticker(),description()).
rsSPX is roc / rocSPX.
rsGroup is rocGroup / rocSPX.
!SCREENING RULES
VolumeRule if avgVolume > minAvgVolume.
TrendRule if C > emaLT.
VolaRule if volaRatio > minVolaRatio and simpleavg(H-L,10) > simpleavg(H-L,200).
RelStrRule if rsSPX > rsSPXmin and rsGroup > rsGroupmin.
PullbackRule if rsi < rsiBuyLvl.
EnoughData if hasdatafor(trendLen+10) > trendLen.
!FundamentalRule if [eps]>[eps est].
Screen if EnoughData
and TrendRule
and VolaRule
and RelStrRule
and PullbackRule
!and FundamentalRule
and VolumeRule.
EntryTrigger if C > lowresult(H,2,1).
Buy if valrule(Screen,1) and EntryTrigger.
Exit if (C < lowresult(L,trailBars,1)) 
or 
(valrule(C > emaST,1) and C < emaST)
or
rsi > rsiExitLvl.
ShowValues if EnoughData.
—Richard Denning
info@TradersEdgeSystems.com
for AIQ Systems
en_GBEnglish
en_GBEnglish