The idea is that by entering a long position just when these 4 criteria are met, you can capture a 2-3% plus move within the next few days:
1. The conversion line is above the base line
2. The price is above the clouds
3. The lagging span is above the clouds
4. The rightmost cloud is green
The same 4 criteria but inverted will indicate a short entry.
In order to avoid 'stale' entries which can lead to chasing, we want the price and conversion line crossovers to be recent, within the past few days. Ideally we want to enter before close on the day the entry signal is given so that we can capture any potential gap up (or down if short). Often the price will make a nice move the next day or day after. If any of the criteria become invalidated, or if after 4-5 days there hasn't been significant movement, then it was a false alarm.
This script will show the basic indicators, plus labels for and price and conversion line crossovers as well as LONG and SHOT indicators to show when the entry criteria have been met.
last phrase of line 66 is the lagging span over cloud check; lagging span price is same as close price but timeshifted back 26 periods, and the leadingLines that define the cloud are timeshifted ahead 26 periods. So comparing current close to cloud from 52 periods ago is comparing the lagging span to the cloud at the tip of the lagging span.
To make a strategy, just modify longCondition and shortCondition to whatever you want your entry criteria to be, then drop something like this at the bottom:
this will keep you long until it signals short, and vice versa so unless that's what you want, you'll also need to set strategy.exit() for "long" and "short".
hope that helps!
I was just wondering is it possible to have the long and short alert when all criteria is met as that is the most important
all that said though, if ppl would find it useful to have a version of this indicator that just throws up 'bullish', 'bearish', or 'neutral' on the chart, it's simple enough that i wouldn't mind cranking that out real quick.