Average EMA Penetration Indicator

[Jusbeyou]

Hello,

I am currently reading Alexander Elder’s “The new Trading For A Living” book and he describes setting a BUY target at an “average EMA penetration.” I am looking for an indicator that can give me the following value:

1. on a daily chart, if 13 bar EMA is in an uptrend (higher than 2 bars ago)

2. calculate an average penetration :
if low price is lower than EMA, then subtract the low price from the EMA (average this number for the last 40 bars)

3. estimate the EMA of tomorrow:
EMA tomorrow = EMA of today + (EMA of today – EMA of yesterday)

4. calculate an entry point:
EntryPoint = EMA tomorrow – average penetration
return Entry

Is it possible to program this as an indicator?

 

[halcyonguy]

Hello,

I am currently reading Alexander Elder’s “The new Trading For A Living” book and he describes setting a BUY target at an “average EMA penetration.” I am looking for an indicator that can give me the following value:

1. on a daily chart, if 13 bar EMA is in an uptrend (higher than 2 bars ago)

2. calculate an average penetration :
if low price is lower than EMA, then subtract the low price from the EMA (average this number for the last 40 bars)

3. estimate the EMA of tomorrow:
EMA tomorrow = EMA of today + (EMA of today – EMA of yesterday)

4. calculate an entry point:
EntryPoint = EMA tomorrow – average penetration
return Entry

Is it possible to program this as an indicator?

here is something to experiment with

#avg_penetration

#https://usethinkscript.com/threads/average-ema-penetration-indicator.19249/
#Average EMA Penetration Indicator
#Jusbeyou  8/5

#I am currently reading Alexander Elder’s “The new Trading For A Living” book and he describes setting a BUY target at an “average EMA penetration.” I am looking for an indicator that can give me the following value:

#1. on a daily chart, if 13 bar EMA is in an uptrend (higher than 2 bars ago)

#2. calculate an average penetration :
#if low price is lower than EMA, then subtract the low price from the EMA (average this number for the last 40 bars)

#3. estimate the EMA of tomorrow:
#EMA tomorrow = EMA of today + (EMA of today – EMA of yesterday)

#4. calculate an entry point:
#EntryPoint = EMA tomorrow – average penetration
#return Entry

#Is it possible to program this as an indicator?


def bn = barnumber();
def data = close;

input avg_type = AverageType.exponential;
#input avg_type = AverageType.Simple;
input avg_length = 13;
def avg = MovingAverage(avg_type, data, avg_length );

plot zavg = if IsNaN(close) then double.NaN else avg;
zavg.SetDefaultColor(Color.magenta);
zavg.setlineweight(1);
zavg.hidebubble();

def r1 = avg > avg[2];
def r2 = low < avg;
def avg_penetration = avg - low;
def plen = 40;
def avgp_avg = average(avg_penetration , plen);

def avg_tomorrow = avg + ( avg - avg[1]);
def entry = avg_tomorrow - avg_penetration;

plot z = if IsNaN(close) then double.NaN else entry;
z.setdefaultcolor(color.cyan);
z.hidebubble();


plot uparrow = entry crosses above avg;
uparrow.SetPaintingStrategy(PaintingStrategy.BOOLEAN_ARROW_UP);
uparrow.SetDefaultColor(Color.green);
uparrow.setlineweight(3);
uparrow.hidebubble();

plot dwnarrow = entry crosses below avg;
dwnarrow.SetPaintingStrategy(PaintingStrategy.BOOLEAN_ARROW_DOWN);
dwnarrow.SetDefaultColor(Color.red);
dwnarrow.setlineweight(3);
dwnarrow.hidebubble();

#