Need help creating a Smart Exponential MA Indicator

[sheldon365]

Hello Forum Members,

I would like your thoughts and help to create the ThinkScript for a Smart Moving Average Buy and Sell Indicator with some logic embedded in it. I do have pieces of the logic that I was easily able to develop using the Moving Avg Crossover Indicator but I am struggling to get the script for the 50MA over 200MA part right.

Here is the logic: let me know your thoughts and if you can backtest this and let me know the probability of profit.

• Bull Market
• Display Buy (Yellow Indicator) when
  • Price crosses 20 EMA from above
  • 50 EMA is above 10 EMA
  • 20 EMA is above 50 EMA
  • 50 EMA is above 200 EMA
• Display Sell (Red Indicator) when
  • Price crosses 10 EMA from above
  • 10 EMA is above 20 EMA
  • 20 EMA is above 50 EMA
  • 50 EMA is above 200 EMA
    
• Bear Market
• Display Sell (Orange Indicator)when
  • Price crosses 20 EMA from below
  • 200 EMA is above 50 EMA
  • 50 EMA is above 20 EMA
• Display Buy (Blue Indicator) when
  • Price crosses 10 EMA from below
  • 200 EMA is above 50 EMA
  • 50 EMA is above 20 EMA
  • 20 EMA is above 10 EMA

 

[halcyonguy]

Any help and insights are highly appreciated!! Please and thank you

typing on my cell, forgive if there are typos....


"Price crosses 20 EMA from above"

i would change your wording to match what will be used. if something came from above , then crossed it, it will be below it. do you mean when price crosses the 20 and ends up below it?

Price crosses below 20 EMA


you don't need to use a crossover study. just create the formulas to compare the variables.

define variables for 4 averages

here is code for 2 averages.
copy 1 set , 2 more times and change things for 50 and 200.

i copied what i already had, so the variable names are generic, i didn't change them.


input avg1_type = AverageType.EXPONENTIAL;
input avg1_price = close;
input avg1_len = 10;
def ma1 = MovingAverage(avg1_type, avg1_price, avg1_len);

input avg2_type = AverageType.EXPONENTIAL;
input avg2_price = close;
input avg2_len = 20;
def ma2 = MovingAverage(avg2_type, avg2_price, avg2_len);

if you want, set new variables if it makes the code easier to figure out what is happening.

def ema10 = ma1;
def ema20 = ma2;
def ema50 = ma3;
drf ema200 = ma4;


then create 4 formulas for the buys and sells. here is one formula.
( check if cross below is what you intended, your description is confusing)

def bullbuy =
(close crosses below ema20
and EMA50 > EMA10
and EMA20 > EMA50
and EMA50 > EMA200);

# draw an up arrow under the bar , of a bullbuy
plot zbullbuy = if bullbuy then low else double.nan;
zbullbuy.setpaintingStrategy(PaintingStrategy.ARROW_UP);
zbullbuy.setdefaultColor(color.yellow);


https://tlc.thinkorswim.com/center/reference/thinkScript/Functions/Tech-Analysis/MovingAverage

https://tlc.thinkorswim.com/center/reference/thinkScript/Constants/AverageType

 

[SleepyZ]

Hello Forum Members,

I would like your thoughts and help to create the ThinkScript for a Smart Moving Average Buy and Sell Indicator with some logic embedded in it. I do have pieces of the logic that I was easily able to develop using the Moving Avg Crossover Indicator but I am struggling to get the script for the 50MA over 200MA part right.

Here is the logic: let me know your thoughts and if you can backtest this and let me know the probability of profit.

• Bull Market
• Display Buy (Yellow Indicator) when
  • Price crosses 20 EMA from above
  • 50 EMA is above 10 EMA
  • 20 EMA is above 50 EMA
  • 50 EMA is above 200 EMA
• Display Sell (Red Indicator) when
  • Price crosses 10 EMA from above
  • 10 EMA is above 20 EMA
  • 20 EMA is above 50 EMA
  • 50 EMA is above 200 EMA
• Bear Market
• Display Sell (Orange Indicator)when
  • Price crosses 20 EMA from below
  • 200 EMA is above 50 EMA
  • 50 EMA is above 20 EMA
• Display Buy (Blue Indicator) when
  • Price crosses 10 EMA from below
  • 200 EMA is above 50 EMA
  • 50 EMA is above 20 EMA
  • 20 EMA is above 10 EMA

A good reference to start with would be to review how TOS's built-in moving average strategy works. See image below.

The Education Tab has a numerous information on how to use Strategies. Here are some links

• Entry and Exit Strategies
• Global Settings
• Strategy Report
• Strategy Properties

 

[sheldon365]

typing on my cell, forgive if there are typos....


"Price crosses 20 EMA from above"

i would change your wording to match what will be used. if something came from above , then crossed it, it will be below it. do you mean when price crosses the 20 and ends up below it?

Price crosses below 20 EMA


you don't need to use a crossover study. just create the formulas to compare the variables.

define variables for 4 averages

here is code for 2 averages.
copy 1 set , 2 more times and change things for 50 and 200.

i copied what i already had, so the variable names are generic, i didn't change them.


input avg1_type = AverageType.EXPONENTIAL;
input avg1_price = close;
input avg1_len = 10;
def ma1 = MovingAverage(avg1_type, avg1_price, avg1_len);

input avg2_type = AverageType.EXPONENTIAL;
input avg2_price = close;
input avg2_len = 20;
def ma2 = MovingAverage(avg2_type, avg2_price, avg2_len);

if you want, set new variables if it makes the code easier to figure out what is happening.

def ema10 = ma1;
def ema20 = ma2;
def ema50 = ma3;
drf ema200 = ma4;


then create 4 formulas for the buys and sells. here is one formula.
( check if cross below is what you intended, your description is confusing)

def bullbuy =
(close crosses below ema20
and EMA50 > EMA10
and EMA20 > EMA50
and EMA50 > EMA200);

# draw an up arrow under the bar , of a bullbuy
plot zbullbuy = if bullbuy then low else double.nan;
zbullbuy.setpaintingStrategy(PaintingStrategy.ARROW_UP);
zbullbuy.setdefaultColor(color.yellow);


https://tlc.thinkorswim.com/center/reference/thinkScript/Functions/Tech-Analysis/MovingAverage

https://tlc.thinkorswim.com/center/reference/thinkScript/Constants/AverageType

Thank you so much, I was able to figure out the script using your direction. I have a question on how to prevent false signals when the moving averages are flat(range-bound market), is there a code that can be added to prevent Moving averages that are flat from showing up a signal?

I currently have is EMA20 > EMA10 (for my BullBuy signal) to prevent that from happening but it still shows me a signal although it should not show me one.

 

[sheldon365]

Any help and insights are highly appreciated!! Please and thank you

 

[halcyonguy]

Thank you so much, I was able to figure out the script using your direction. I have a question on how to prevent false signals when the moving averages are flat(range-bound market), is there a code that can be added to prevent Moving averages that are flat from showing up a signal?

I currently have is EMA20 > EMA10 (for my BullBuy signal) to prevent that from happening but it still shows me a signal although it should not show me one.

maybe check if the bar to bar change of an average is small, less than some %.
guessing at a % of 0.3.

input flat_limit_percent = 0.3;
def avg_chg = ma1 - ma1[1];
def isflat = ( (100 * ( avg_chg / ma1)) <= flat_limit_percent);