0bps

Strategy vault / Mean reversion

Demark Setup Indicator

The Setup Indicator was created by Tom Demark and this is one of many steps in his Sequential Indicator that I will be publishing at a later date. You guys all seemed to really like my Demark Reversal Points script…

Pine ScriptMean reversionTrend following
Author
ChaoZhang
Complexity
Starter · 40 lines
Parameters
5
Backtest bar
30m · intraday
Tested on
BTC/USDT · futures
Jump to codeView in vaultOriginal on FMZ

The Setup Indicator was created by Tom Demark and this is one of many steps in his Sequential Indicator that I will be publishing at a later date. You guys all seemed to really like my Demark Reversal Points script and this indicator is very similar to that one. This indicator was designed for minor trend reversals and as you can see in my example chart, it gives many more buy and sell signals. Not all are perfect of course but it does a pretty good job in identifying minor price reversals overall. This indicator looks for downtrends or uptrends that exist for a certain amount of time to determine price reversal points.

If you like this one then let me know and I will continue publishing more Demark indicators or at least my versions of them. Let me know if there are any other indicators you would like to see me publish!

backtest

IMG

Parameters

NameDefaultWhat it controls
v_input_1_close0Source: close | high | low | open | hl2 | hlc3 | hlcc4 | ohlc4
v_input_2Resolution
v_input_3falseAllow Repainting?
v_input_4trueAllow Bar Color Change?
v_input_54Length

Source Pine Script

/*backtest
start: 2022-04-30 00:00:00
end: 2022-05-29 23:59:00
period: 30m
basePeriod: 15m
exchanges: [{"eid":"Futures_Binance","currency":"BTC_USDT"}]
*/

//@version=4
// Copyright (c) 2019-present, Franklin Moormann (cheatcountry)
// Demark Setup Indicator [CC] script may be freely distributed under the MIT license.
study("Demark Setup Indicator [CC]", overlay=true)

inp = input(title="Source", type=input.source, defval=close)
res = input(title="Resolution", type=input.resolution, defval="")
rep = input(title="Allow Repainting?", type=input.bool, defval=false)
bar = input(title="Allow Bar Color Change?", type=input.bool, defval=true)
src = security(syminfo.tickerid, res, inp[rep ? 0 : barstate.isrealtime ? 1 : 0])[rep ? 0 : barstate.isrealtime ? 0 : 1]
length = input(title="Length", type=input.integer, defval=4, minval=1)

uCount = 0, dCount = 0
for i = 0 to length - 1
    uCount := uCount + (nz(src[i]) > nz(src[i + length]) ? 1 : 0)
    dCount := dCount + (nz(src[i]) < nz(src[i + length]) ? 1 : 0)
    
dsi = dCount == length ? 1 : uCount == length ? -1 : 0

sig = dsi > 0 or uCount > dCount ? 1 : dsi < 0 or dCount > uCount ? -1 : 0
dsiColor = sig > 0 ? color.green : sig < 0 ? color.red : color.black
alertcondition(crossover(dsi, 0), "Buy Signal", "Bullish Change Detected")
alertcondition(crossunder(dsi, 0), "Sell Signal", "Bearish Change Detected")
barcolor(bar ? dsiColor : na)
plotshape(crossover(dsi, 0), "Buy", shape.labelup, location.belowbar, color.green, text="Buy", textcolor=color.white)
plotshape(crossunder(dsi, 0), "Sell", shape.labeldown, location.abovebar, color=color.red, text="Sell", textcolor=color.white)


if crossover(dsi, 0)
    strategy.entry("Enter Long", strategy.long)
else if crossunder(dsi, 0)
    strategy.entry("Enter Short", strategy.short)

Published by ChaoZhang on the FMZ strategy square · last modified 2022-05-31. Collected in the Quant Trading Vault. Unvalidated research: re-test with your own data and costs before trusting it.

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