It comes with:
- 2 sets of settings you can flip between,
- 5 types of markers:
--- Tenkan/Kijun crosses,
--- Price (close)/Tenkan crosses, with the option of only showing those occurring with the trend, so on pullbacks,
--- Price (close) exits out of the Kumo,
--- Chikou exits out of the Kumo,
--- Overbought/Oversold conditions (shown on the chart).
- Choice of showing only long or short markers,
- Coloring of bars using OB/OS conditions,
- Alerts on all markers and on combinations.
The markers are intended as indications—not bulletproof buy/sell signals.
The overbought/oversold conditions are detected when the high/low is a multiple of ATR away from Kijun. The ATR length and multiple used are configurable.
I normally use the Josh Olszewicz (CarpeNoctom) big settings, so those are the default.
I prefer subtle coloring on charts and my choice of colors reflects that.
You will see references to KumoA and KumoB in the names of inputs and style elements. For me, KumoA is the top of the Kumo when it is , so the bottom when .
As usual when creating alerts, be sure you already have defined proper inputs and that you are on the intended interval, as they will be used when triggering alerts.
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.
Tools and ideas for all Pine coders: http://www.pinecoders.com
If you don't mind can you tell me more about the Over Brought and Over Sold signals based on ATR. Actually there are too many signals in bunch which makes it less reliable. So how it can be improved? And what to keep in mind during strong trend/weak trend or range market? Also what extra confirmation can be looked at to consider those signals?
If you can share any more knowledge it will be interesting as I am looking to create a strategy based on Ichimoku Cloud and came through your additional feature of OB/OS and found it interesting so want to learn more if possible.
The areas identified by Markers #5 are high-risk entries, as you are entering against the main trend and volatility is typically high, so these will often be short trades with greater chances of being stopped out because of the higher volatility. Confirmation of that type of entry could be a bar in the direction of your trade following a marker, or waiting for when the markers stop printing on the chart.
A strategy for stop placement could be a make-or-break tight stop on the low of the bar preceding long entries, for example, with no move before the trade reaches breakeven.