blackcat1402

[blackcat] L2 Ehlers SwamiCharts RSI

Level: 2

Background

John F. Ehlers introuced SwamiCharts RSI in his "Cycle Analytics for Traders" chapter 16 on 2013.

Function

SwamiCharts retain the core functionality of the technical indicators with which you're already familiar, while packing much more information into an easy-to interpret heat map chart. With SwamiCharts, you now visualize each indicator over a range of lookback periods
to reveal a better view of the indicator's truer meaning in context. SwamiCharts provide a better solution because you can now visualize context over a wide range of lookback periods. Trends and cycles emerge more succinctly, while continuation patterns and reversals become
easier to identify. SwamiCharts solves the data lookback problem by enabling you to view market conditions at a glance, a feature that will dramatically facilitate your trading.

Since the MyRSI is computed for all values over the range of lookback periods, it must be an array in Pine v4.0 rather than a variable. The RSI is computed relative to the output of the roofing filter rather than price closes to eliminate the effects of Spectral Dilation. After the computation of the ratio, the indicator is smoothed in a SuperSmoother filter, so we must create the three most recent instances ourselves in the code. This is because Pine v4.0 retains historical values for variables but not for arrays. In fact, ratio must be an array also for the same reasons. The coefficients for the 10-bar SuperSmoother filter are computed and are the same for all lookback periods, and so can be outside the lookback loop to make the calculations a little more efficient.

Key Signal

MyRSI1 --> Modified RSI by John Ehlers


Pros and Cons

100% John F. Ehlers definition translation, even variable names are the same. This help readers who would like to use pine to read his book.

Remarks

The 62th script for Blackcat1402 John F. Ehlers Week publication.

Readme

In real life, I am a prolific inventor. I have successfully applied for more than 60 international and regional patents in the past 12 years. But in the past two years or so, I have tried to transfer my creativity to the development of trading strategies. Tradingview is the ideal platform for me. I am selecting and contributing some of the hundreds of scripts to publish in Tradingview community. Welcome everyone to interact with me to discuss these interesting pine scripts.

The scripts posted are categorized into 5 levels according to my efforts or manhours put into these works.

Level 1 : interesting script snippets or distinctive improvement from classic indicators or strategy. Level 1 scripts can usually appear in more complex indicators as a function module or element.

Level 2 : composite indicator/strategy. By selecting or combining several independent or dependent functions or sub indicators in proper way, the composite script exhibits a resonance phenomenon which can filter out noise or fake trading signal to enhance trading confidence level.

Level 3 : comprehensive indicator/strategy. They are simple trading systems based on my strategies. They are commonly containing several or all of entry signal, close signal, stop loss, take profit, re-entry, risk management, and position sizing techniques. Even some interesting fundamental and mass psychological aspects are incorporated.

Level 4 : script snippets or functions that do not disclose source code. Interesting element that can reveal market laws and work as raw material for indicators and strategies. If you find Level 1~2 scripts are helpful, Level 4 is a private version that took me far more efforts to develop.

Level 5 : indicator/strategy that do not disclose source code. private version of Level 3 script with my accumulated script processing skills or a large number of custom functions. I had a private function library built in past two years. Level 5 scripts use many of them to achieve private trading strategy.
Release Notes: This version provides 2 important updates:
1. Improve the visual effect of SwamiCharts by using mixed resolution. Use low-resolution drawing when the Lookback value is low, and use high-resolution drawing when the Lookback value is high. This will help expand the scope of Lookback.
2. Many people ask how SwamiCharts determines Entry Points. I demonstrated that the determination of long entry and short entry can be achieved through color threshold control, and the labels are used to prompt in the chart. Since Tradingview has restrictions on the number of labels (saving computing resources), it can only display a limited number of labels. This phenomenon is not caused by the principle of indicators.
Release Notes: This version adjusted label size for better visual effects.
Skript med en öppen källkod

In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in a publication is governed by House Rules. You can favorite it to use it on a chart.

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