This is a very powerful indicator that provides a mix of three running totals of linear weighted returns. Each one is similar to a specific mode of ReturnAutoScale indicator.
The result is a scaled superposition of three integrated and difference-stationary time series, each for different trading strategy. Indicator displays three lines:
- yellow – slow market returns, corresponds to mode 0 in ReturnAutoScale;
- blue – medium market returns, corresponds to mode 1 in ReturnAutoScale;
- red – fast market returns, corresponds to mode 2 in ReturnAutoScale;
Two trading strategies are possible:
- conservative – buy when medium-term line is over long-term line, sell when medium-term is below long-term line;
- risky – buy when short-term line is over medium-term line, sell when short-term is below medium-term (make sure there is no global trend).
Parameters:
- period – number of bars to use for linear weighted calculation; default value – 96;
- smoothing – period for EMA; default value – 5;
- price – price type to use; default value – open.
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