HPotter

Smart Money Index (SMI)

Smart money index ( SMI             ) or smart money flow index is a technical analysis indicator demonstrating investors sentiment.
The index was invented and popularized by money manager Don Hays. The indicator is based on intra-day price patterns.
The main idea is that the majority of traders (emotional, news-driven) overreact at the beginning of the trading day
because of the overnight news and economic data. There is also a lot of buying on market orders and short covering at the opening.
Smart, experienced investors start trading closer to the end of the day having the opportunity to evaluate market performance.
Therefore, the basic strategy is to bet against the morning price trend and bet with the evening price trend. The SMI             may be calculated
for many markets and market indices ( S&P 500             , DJIA             , etc.)

The SMI             sends no clear signal whether the market is bullish or bearish . There are also no fixed absolute or relative readings signaling
about the trend. Traders need to look at the SMI             dynamics relative to that of the market. If, for example, SMI             rises sharply when the
market falls, this fact would mean that smart money is buying, and the market is to revert to an uptrend soon. The opposite situation
is also true. A rapidly falling SMI             during a bullish market means that smart money is selling and that market is to revert to a downtrend
soon. The SMI             is, therefore, a trend-based indicator.
Some analysts use the smart money index to claim that precious metals such as gold             will continually maintain value in the future.
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//  Copyright by HPotter v1.0 10/06/2014
// Attention:
// If you would to use this indicator on the ES, you should have intraday data 60min in your account.
//
// Smart money index (SMI) or smart money flow index is a technical analysis indicator demonstrating investors sentiment. 
// The index was invented and popularized by money manager Don Hays.[1] The indicator is based on intra-day price patterns.
// The main idea is that the majority of traders (emotional, news-driven) overreact at the beginning of the trading day 
// because of the overnight news and economic data. There is also a lot of buying on market orders and short covering at the opening. 
// Smart, experienced investors start trading closer to the end of the day having the opportunity to evaluate market performance.
// Therefore, the basic strategy is to bet against the morning price trend and bet with the evening price trend. The SMI may be calculated 
// for many markets and market indices (S&P 500, DJIA, etc.)
//
// The SMI sends no clear signal whether the market is bullish or bearish. There are also no fixed absolute or relative readings signaling 
// about the trend. Traders need to look at the SMI dynamics relative to that of the market. If, for example, SMI rises sharply when the 
// market falls, this fact would mean that smart money is buying, and the market is to revert to an uptrend soon. The opposite situation 
// is also true. A rapidly falling SMI during a bullish market means that smart money is selling and that market is to revert to a downtrend 
// soon. The SMI is, therefore, a trend-based indicator.
// Some analysts use the smart money index to claim that precious metals such as gold will continually maintain value in the future.
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study(title="Smart Money Index (SMI)", shorttitle="Smart Money Index")
xcloseH1 = security(tickerid, "60", close)
xopenH1 =  security(tickerid, "60", open)
nRes = nz(nRes[1], 1) - (open - close) + (xopenH1 - xcloseH1)
plot(nRes, color=green, title="SMI")
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BTC: 1Lo1GoTNsPbrjGAgPgF4MYZPhBFdoVHaTm
thanks. how can i get this? i dont see make it mine button
Reply
Tested on TSLA, but the SMI lines seems almost the same as the RSI line. Where is the crucial difference? tnx!
Reply
Thanks HP. This is one I use to use and forgot about. Appreciate your sharing it.
Reply
You are welcome
Reply
Nice Indy HP. Can an alert be added for % movement (of the current candle, at the close of the current candle)?
Reply
toxguy749s PRO toxguy749s
To clarify further, I'm looking for the ability to choose a percent threshold and set an alert (positive or negative) on the indicator. I'd like the ability to be alerted if current price candle causes indicator to move beyond my preset threshold.
Reply
louai PRO HPotter
@HPotter, why does the smi. Move up on time frame and it moves slow during a shorter time frame
Reply
@louai, It is use 60min data for calculating.
Reply
tuandq30 HPotter
@HPotter, Chao him he could help me write this indicator on AmiBroker 6 no I do not write this indicated if you please write me thank tuandq30gmail.com email
Reply
I found this on stocktwits. Is this similar to yours?
http://jlfmi.tumblr.com/post/114662836845/this-shift-in-a-smart-money-indicator-may-be
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