Note: This is a modified version of TradingView's built-in "Divergence Indicator" and applied in "Strategy" format to show back testing results It finds bullish and bearish divergence in a selection of well known MA formulas: MACD, RSI, STOCH, DETRENDED PRICE OSCILLATOR, MOMENTUM.
I've found good results even on 1 minute charts!
In this example the chart backtest is utilizing the detrended price oscillator (DPO)
There are multiple variables, so the ability to find good back test can sometimes be "time consuming" And please note that if you increase "Pivot LookBack Right" variable too high, then you will increase chance of repaint. Keep this variable as low as possible
I've also drawn my own solutions on the chart (red and green trend lines) to find good take profit and safe stop loss. In order to study this properly you need the own the chart. Scripts don't give you this option. See private chart publication link to "own" the chart for yourself. Simply click on the "Share" button (it's the megaphone icon) and click on "Make it Mine"
I've found the best approach is to create 5 copies of indicator on 1 chart and have each running with different MA formula. This will give you a majority consensus type environment.
going thru this thing as a practice on converting strategies to studies with alerts...super easy to use. Excellent work sir.
JoshuaMcGowan
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and if forward testing is anywhere near backtesting i owe u a beer or ten haha.
dpanday
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Any advice on how to get the best settings? And what are the forward testing results as often strategies doesnt hold long with the same settings.
Craig_Claussen
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@dpanday, no advice. just trial and error. And as for your second question, look at my other concepts I cherish. This script is nothing more than a tool to teach people how to read indicators. And why they are important tools. And why someone thought them worthy to create. The real question is learning to read it. Some of the greatest "ideas" chart authors, hardly use anything other than a price action chart with a few MA's attached. Tradingview is designed to give you more than just price action charting. If you learn to understand the indicators you have much better chance of "winning". But that is just my opinion.
Point being... if you understand what this indicator is teaching, then you can apply the same concept to any chart time frame and capitalize. You can actually do it better than the indicator can, but if you don't know what to look for then how do you begin to learn 'on the fly'.
And by all means, I'd love for you to be proactive and help me with forward testing with charts. If you find a good variable combo, feel free to post here in a private publish link and we can all track together.
I'm not here to make money off anyone, just posting my findings because I like sharing trading philosophies!
Cheers!
dpanday
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@Craig_Claussen, Thank you for your clear and extensive answer. I will try some with it and when i find good results i wil let you know:)
Duanthiassom
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Someone use this on Finandy ?
Docop1
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Hi, quite an interesting script.. But not sure about the work of it.. Can i just put another ma .. like an Elder or other.. and the divergence will apply to the plot made automatically ?
thanks
Craig_Claussen
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@Docop1, Of course. I've even tried OBV indicator which shows some interesting tests.
I've also applied stochrsi and true strength indicator and was impressed with the results.
Craig_Claussen
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Posting for forward testing backtest
vladimir20
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@Craig_Claussen,
Здравствуйте,а можно на этот индикатор поставить сигнал,чтобы несмотреть все время в экран компьютера и вовремя открыть сделку???