Hello Friends,,, =================================== This indicator is based on Bayes' Theorem and is fully based on probabilities. =================================== Formula For Bayes' Theorem:
P(Bull|Bear) = P(Bear∣Bull) * P(Bull) / P(Bear)
where: Bull and Bear are events and P is probability P(Bull|Bear) is the posterior probability, the probability of Bull after taking into account Bear P(Bear∣Bull) is the conditional probability or likelihood, the degree of belief in Bear given that proposition of Bull belief (Bull true) P(Bull) is the prior probability, the probability of Bull belief P(Bear) is the prior probability, the probability of Bear belief ===================================
The indicator output 2 trend lines and (Bull/Bear) Signal :
Bull/Bear Probability Trend : when the price is above it = Up Trend when the price is below it = Down Trend
Bull/Bear Probability Trend Moving Average : when the price is above it = Up Trend when the price is below it = Down Trend
(Bull/Bear) Signal : when Probability Trend Moving Average crossover Probability Trend = Bull Signal when Probability Trend Moving Average crossunder Probability Trend = Bear Signal =================================== Disclaimer: This script is for informational and educational purposes only. Use of the script does not constitutes professional and/or financial advice. You alone the sole responsibility of evaluating the script output and risks associated with the use of the script. =================================== Thanks to my friends dgtrd because he inspired me about probability, take a look at his scripts. ===================================