Volatility Trend (Zeiierman)

Oct 25, 2023

█ Overview
The Volatility Trend (Zeiierman) is an indicator designed to help traders identify and analyze market trends based on price volatility. By calculating a dynamic trend line and volatility-adjusted bands, the indicator provides visual cues to understand the current market direction, potential reversal points and volatility.




█ How It Works
The indicator uses a weighted moving average of historical prices to create a responsive trend line that is adjusted for volatility using standard deviation. The indicator sets upper and lower bands at intervals of two standard deviations, acting as markers for potential overbought or oversold conditions. Additionally, by comparing current and previous trend line values, the indicator identifies the trend direction, providing crucial insights for traders.

█ How to Use
Trend Identification
Use the trend line to identify the overall market direction. An upward-sloping line indicates an uptrend, while a downward-sloping line indicates a downtrend.




Volatility Assessment
Use the distance between the upper and lower bands to gauge market volatility. Wider bands indicate higher volatility, while narrower bands indicate lower volatility.




Overbought/Oversold
If the price reaches or exceeds the upper or lower bands, it may be in an overbought or oversold condition, respectively.




█ Settings

• Trend Control: Adjusts the sensitivity and smoothness of the trend line. Lower values make the trend more responsive, while higher values make it smoother.
  
• Trend Dynamic: Controls how quickly the trend adjusts to price changes. Higher values result in a slower adjustment.
  
• Volatility: Consists of two parts - the scaling factor for volatility and the sensitivity for volatility adjustment. Adjusting these settings alters the distance between the trend lines and the price, as well as how sensitive the bands are to changes in volatility.
  
• Squeeze Control: Influences the degree to which market squeeze is considered in the calculation, with higher values increasing sensitivity.
  
• Enable Scalping Trend: A toggle that, when activated, makes the indicator focus on short-term trends, which is particularly useful for scalping strategies.
  

█ Related scripts with the same calculation philosophy
TrendCylinder
TrendSphere
Predictive Trend and Structure

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Disclaimer

The information contained in my Scripts/Indicators/Ideas/Algos/Systems does not constitute financial advice or a solicitation to buy or sell any securities of any type. I will not accept liability for any loss or damage, including without limitation any loss of profit, which may arise directly or indirectly from the use of or reliance on such information.

All investments involve risk, and the past performance of a security, industry, sector, market, financial product, trading strategy, backtest, or individual's trading does not guarantee future results or returns. Investors are fully responsible for any investment decisions they make. Such decisions should be based solely on an evaluation of their financial circumstances, investment objectives, risk tolerance, and liquidity needs.

My Scripts/Indicators/Ideas/Algos/Systems are only for educational purposes!

Oct 31, 2023

Release Notes

License added