L2 Waveband Trading [blackcat]

Posts: 5196 · #1 - January 07, 2025, 10:58:54 PM

Overview:

The Waveband Trading script calculates trading signals based on a modified Relative Strength Index (RSI)-like system combined with specific price action criteria. It plots two lines representing different smoothed RSI-like indicators and marks potential buying opportunities labeled as "S" for stronger trends and "B" for weaker but still favorable ones.
The script begins by defining the waveband_trading_signals function which computes RSI-like metrics and determines buy signals under certain conditions. The main sections include input parameter definitions, function calls, data processing within the function, and plot commands for visual representation. Data flows from historical OHLCV data to various technical computations like EMAs and SMAs before being evaluated against user-defined thresholds to generate trade signals.

Example:

Features:

Utilizes EMA and SMA functions to smooth out price variations effectively.
Employs crossover logic between fast ('k') and slow ('d') indicators to identify entry points.
Incorporates volume checks ensuring increasing interest in trades aligns with upwards momentum.
Incorporates volume checks ensuring increasing interest in trades aligns with upwards momentum.
Uses the new labeling feature (label.new) introduced in Pine Script v5 for marking significant chart events visually.

Availability: