MACD Buy & Sell Signal

[Panzer12]

Hey guys. I'm trying to learn ThinkScript, so I'm creating different systems to learn various tricks. I've been experimenting with making a strategy using indicators. In this case, it's with MACD.

The following code is a collection of different codes that I've taken from various forums.

My main goal is to code a strategy where a buy or sell signal is generated when the MACD changes color and confirms after two consecutive bars of the same color. Additionally, I want to include an input for a stop-loss percentage in the same system.

This is what I have so far. Now, I don't quite understand if it's correct or how to modify it so that the confirmation signal is generated when there are consecutive bars of the same color.

Hope I explained myself clearly

Thanks fot your help!!!

# macd_histo_colors_arrows_strat

#https://usethinkscript.com/threads/accessing-items-in-macd-diff.17075/
#Accessing items in MACD.Diff
#Peppermshrimp 11/2

#Is there a way to reference 4 different ‘trends’ in MACD.Diff, other than just to change the colors? I am referring to ‘Negative and Down’, ‘Negative and Up’, ‘Positive and Down’, and ‘Positive and Up’. (see images below) I would like to set up a Strategy that puts an up arrow on the chart when these switch between ‘Negative and Down’ to ‘Negative and Up’, and puts a down arrow on the chart when they switch from ‘Positive and Down’ to ‘Positive and Up’. The only thinkscript I can find with respect to these 4 trends is when the color is being defined.

def na = Double.NaN;
def bn = BarNumber();

def ref1 = if bn == 1 then close else ref1[1];

# macd
# TD Ameritrade IP Company, Inc. (c) 2007-2023
input fastLength = 12;
input slowLength = 26;
input MACDLength = 9;
input averageType = AverageType.EXPONENTIAL;
input showBreakoutSignals = no;

def Value = MovingAverage(averageType, close, fastLength) - MovingAverage(averageType, close, slowLength);
def Avg = MovingAverage(averageType, Value, MACDLength);
def Diff = Value - Avg;

# create # 's for diff colors , -2 to 2
# all color transistitions
#def Diff_color_num =
# if Diff > 0 and Diff > Diff[1] then 2
# else if Diff < 0 and Diff < Diff[1] then -2
# else if Diff > 0 and Diff < Diff[1] then -1
# else if Diff < 0 and Diff > Diff[1] then 1
# else 0;


# color changes, lowest and highest
def Diff_color_num =
if Diff > 0 and Diff < Diff[1] then -1
else if Diff < 0 and Diff > Diff[1] then 1
else 0;


# require x colors in a row to be considered a new color
input consecutive_bars = 2;
def qty = consecutive_bars;
def numsum = if Sum(Diff_color_num, qty) == (Diff_color_num * qty) then 1 else 0;

def new_color = if (numsum and GetValue(Diff_color_num, qty) != Diff_color_num) then 1 else 0;
#def new_color = if (numsum and getvalue(numsum, qty) and getvalue(diff_color_num, qty) != diff_color_num) then 1 else 0;


# create a trade signal , from the 1st of consequetive signals
def trade = if bn == 1 then 0
else if Diff_color_num == -1 and new_color then -1
else if Diff_color_num == 1 and new_color then 1
else trade[1];

#//================================================================//#

input offsetType = {default percent, value, tick};
input stop = 0.75;

def entryPrice = entryPrice();
def mult;
switch (offsetType) {
case percent:
mult = entryPrice / 100;
case value:
mult = 1;
case tick:
mult = tickSize();
}
def stopPrice = entryPrice - stop * mult;


#//================================================================//#

def buy = (trade[0] == 1 and trade[1] == -1);
def sell = (trade[0] == -1 and trade[1] == 1);
input order_size = 1;
AddOrder(OrderType.BUY_TO_OPEN, buy, open[-1], order_size, Color.GREEN, Color.GREEN, name = "BUY");
AddOrder(OrderType.SELL_TO_CLOSE, sell, open[-1], order_size, Color.RED, Color.RED, name = "SELL");

addOrder(OrderType.SELL_TO_CLOSE, low <= stopPrice, tickColor = GetColor(5), arrowColor = GetColor(5), name = "Stop");

It gives me the buy signal on the third (input) consecutive lower bar. But it is still the same color.

Edit:
Don´t understand the objective of this code.

# create # 's for diff colors , -2 to 2
# all color transistitions
#def Diff_color_num =
# if Diff > 0 and Diff > Diff[1] then 2
# else if Diff < 0 and Diff < Diff[1] then -2
# else if Diff > 0 and Diff < Diff[1] then -1
# else if Diff < 0 and Diff > Diff[1] then 1
# else 0;

 

[Alert Turnip]

Don´t understand the objective of this code.

# create # 's for diff colors , -2 to 2
# all color transistitions
#def Diff_color_num =
# if Diff > 0 and Diff > Diff[1] then 2
# else if Diff < 0 and Diff < Diff[1] then -2
# else if Diff > 0 and Diff < Diff[1] then -1
# else if Diff < 0 and Diff > Diff[1] then 1
# else 0;

The Diff variable is your MACD Histogram. This compares the current MACD Histogram value against 0 and the previous (left bar's) value. The logic is:

• MACD H > 0 and > previous value => 2
• MACD H < 0 and < previous value => -2
• MACD H > 0 and < previous value => -1
• MACD H < 0 and > previous value => 1
• Fallback to 0.

If MACD H is going up, this gives us a positive number. Being above the zero line is stronger.

If MACD H is going down, this gives us a negative number. Being below the zero line is stronger.

Did you intend to use Value (MACD line)?