Arc Breakout Entry - Indicator Coding Request

[ArcRider]

Anyone like to try and code this?

See Picture for better visual idea of how it would work / look like.

This indicator strategy would find when one arc ends and a new one begins. Entry on a new arc for very safe entry.
(I jokingly call it the "pot of gold" at the end of the rainbow, because it's such a low risk entry.)

• Things to know about arcs before I explain the indicator function:
  • Quadratic Arc behavior:
    • Markets move in waves, contained within Quadratic Arc curves. Arcs can be symmetrical, from a middle point called the point of inflection. So, front half mirror the back half.
    • If given only the front side data, with assumption of the most current point being the current point of inflection, you can assume the back side of the curve as a predictor.
• Ideas on how to write an arc using math: https://www.quora.com/How-do-I-find-the-maximum-minimum-and-point-of-inflection-of-the-function-f-x-2x²-6x+5
• Progression of arc as a sequence of conditional events:
  • Arc would start on a breakout candle. Entry Here, with risk down to last lowest low
  • Arc curve is drawn from last valley low before the breakout. use the quadratic arc formula to draw the arc using at least 3 points. Would be helpful to project the curve into the future, as a predictor if you know how to code that.
  • YES, the arc WILL repaint by adding in new high peaks. These are shown as green points.
  • The most current peak would be considered the magenta inflection point until there are no more high peaks... This is the current middle high of the arc shape
  • which then display as red point indicator conditions. (time to get out of the uptrend arc.)
  • Arc ends when new arc breakout begins.
• Problems I see will come up when trying to explain this in computer code:
  • How to filter only the bigger highs, and not the smaller. This could turn into a fractal problem, and you would see arcs within arcs. We only want the larger arc shape. Later we could add a feature to select the arc size or detail, but I'm just trying to narrow down to the minimum viable product right now.

 

[halcyonguy]

Anyone like to try and code this?

See Picture for better visual idea of how it would work / look like.

This indicator strategy would find when one arc ends and a new one begins. Entry on a new arc for very safe entry.
(I jokingly call it the "pot of gold" at the end of the rainbow, because it's such a low risk entry.)

• Things to know about arcs before I explain the indicator function:
  • Quadratic Arc behavior:
    • Markets move in waves, contained within Quadratic Arc curves. Arcs can be symmetrical, from a middle point called the point of inflection. So, front half mirror the back half.
    • If given only the front side data, with assumption of the most current point being the current point of inflection, you can assume the back side of the curve as a predictor.
• How I think it would be coded???
  • Well... Chat GPT gives an example in python how to code a regression arc using data. I don't know how to translate that into thinkscript. Here's my chat GPT result. Also gives the raw quadratic arc expression. https://chat.openai.com/share/47996c99-71b2-4902-ad5e-d419952cab3b
  • More Ideas on how to write an arc using math: https://www.quora.com/How-do-I-find-the-maximum-minimum-and-point-of-inflection-of-the-function-f-x-2x²-6x+5
• Progression of arc as a sequence of conditional events:
  • Arc would start on a breakout candle. Entry Here, with risk down to last lowest low
  • Arc curve is drawn from last valley low before the breakout. use the quadratic arc formula to draw the arc using at least 3 points. Would be helpful to project the curve into the future, as a predictor if you know how to code that.
  • YES, the arc WILL repaint by adding in new high peaks. These are shown as green points.
  • The most current peak would be considered the magenta inflection point until there are no more high peaks... This is the current middle high of the arc shape
  • which then display as red point indicator conditions. (time to get out of the uptrend arc.)
  • Arc ends when new arc breakout begins.
• Problems I see will come up when trying to explain this in computer code:
  • How to filter only the bigger highs, and not the smaller. This could turn into a fractal problem, and you would see arcs within arcs. We only want the larger arc shape. Later we could add a feature to select the arc size or detail, but I'm just trying to narrow down to the minimum viable product right now.

here is a post with some polynomial studies. one of them could be a starting point.
https://usethinkscript.com/threads/polynomial-regression-channel-prc-quadratic-regression.1491/

this is interesting, but complicated.
let's look at your image and determine what a study would be looking for and what is needed.
it doesn't matter what shape the arc is. an arc may not even be needed.
it appears, that it is looking for reversals. when does price change direction.

here is a simple interpretation of your idea.
i drew a red line across 2 peaks and extended it to the right. when price crosses above it, price has probably reversed.

outline,
find peaks
calc the slope between 2 peaks (a left and a right peak)
draw a line from right peak, using the previous slope
check if price crosses the line

 

[ArcRider]

here is a post with some polynomial studies. one of them could be a starting point.
https://usethinkscript.com/threads/polynomial-regression-channel-prc-quadratic-regression.1491/

this is interesting, but complicated.
let's look at your image and determine what a study would be looking for and what is needed.
it doesn't matter what shape the arc is. an arc may not even be needed.
it appears, that it is looking for reversals. when does price change direction.

here is a simple interpretation of your idea.
i drew a red line across 2 peaks and extended it to the right. when price crosses above it, price has probably reversed.

outline,
find peaks
calc the slope between 2 peaks (a left and a right peak)
draw a line from right peak, using the previous slope
check if price crosses the line

Thanks for the reply!

Yes I’ve tried poly nominal regression indicators before but I didn’t know how to set them up into a useable strategy. I bought the one from fun with think script a couple years ago and it kept changing as the market moved. Maybe my settings were not correct for the scale I was looking at.

Yes down sloping trend lines based on the last highs do work for finding arc breakouts. I personally do this manually right now. There are 3 types of trend lines I draw:

1 from highest arc peak to next highest but lower peak going forward. This is the “arc line” and it tells me I won’t be able to hold an uptrend for a while until price crosses this line and stays above.

1 from last peak mentioned to next highest but lower peak. This trend lines is angled more down and is inside the arc line. I call this the “wave line”. It tells me if there is a dead cat bounce, price will come back up to this line and continue down. The line is still a decision area where price could breakout or fall down further.

1 from last peak mentioned down to tops of candles creating a steep slope channel of candles. This is my “leg line”. Where candles shoot down in a momentous run. Any break above this line alerts me of the end of a fast down trend of proceeding candles. Also reminds me that I still have to wait for price to break the other two lines before any real uptrend can occur.

So essentially I’m finding the valley when one. Arc back side ends.

See example picture

 

[AlphaOptions]

@ArcRider - did you ever have any success with coding these ideas. I am very interested to follow anything you have found.

 

[useThinkScript]

ArcRider - did you ever have any success with coding these ideas. I am very interested to follow anything you have found.

Did you know that by clicking on a member's name, you can easily check when they were last seen on the uTS forum? It's a great way to keep track of who's been around recently, and who hasn't. Speaking of which, it looks like @ArcRider has not been active in a while.

 

[METAL]

It appears to me that a Simple HH, HL, LH and LL script will achieve the same thing. The big issue I see here is that it is just a guess. You will need to have a stop loss just under the last LL or LH and you may have a ton of losses. I do not see a good risk to reward for this because the price may just turn and go down just after each of your red dots resulting in losses.

 

[MerryDay]

It appears to me that a Simple HH, HL, LH and LL script will achieve the same thing. The big issue I see here is that it is just a guess. You will need to have a stop loss just under the last LL or LH and you may have a ton of losses. I do not see a good risk to reward for this because the price may just turn and go down just after each of your red dots resulting in losses.

Yes, you are correct. Polynomial studies do repaint. Your warnings are apt for all repainters.

However, you are incorrect that polynomials are comparable to a Simple HH, HL, LH and LL script.
Polynomial studies are some of the most complex and interesting on the forum.
They are used in estimating price trends and support and resistance levels.
Polynomial strategies are the fastest heads up to capitalize on momentum and warn of possible trend reversals.

No, never use repainters as signals.
But members should google the fascinating world of polynomial analysis and whether it will bring value to their charts.

Read more here:
https://usethinkscript.com/threads/...-slope-qtl-for-thinkorswim.15137/#post-140932

 

[useThinkScript]

They are comparable in that neither the ARC method, Simple HH, HL, LH and LL script, nor any other repainters should not be relied on for entry signals.

 

[METAL]

They are comparable in that neither the ARC method, Simple HH, HL, LH and LL script, nor any other repainters should not be relied on for entry signals.

Exactly what I was trying to relay. Was just trying to point out the possible false entry points for both.

 

[AlphaOptions]

Thank you for comments. I am still trying to think through the original post. Despite the limitations of repainting (and the very good commentary in the link), it still might help formulate the basis of a conceptual framework from which to construct a more reliable approach? In other words, a repainting initial version might give a starting point from which to build if it is possible? A curvilinear model is visible in many charts even beyond the cup and handle and the rounded tops bottoms, etc. Most charting tools and scripts are linear so something with a curve has potential to add value and worth exploring and worth exploring IMO as we can see curves in many price patterns especially if we zoom out. Also it could viewed that the re-positioning is because of criteria that exists at that moment and thus more of a snapshot than a durable level. I am perhaps less averse to re-configuring charting tools since my option price is constantly changing too in a dynamic market of constantly shifting price, volatility, news, etc. Sometimes the best I can achieve is a snapshot in time to take and then exit a position.