Asset Valuation Tool

2. Dez. 2024

Asset Valuation Tool
This script provides a multi-dimensional perspective on asset valuation by comparing its price movements against three major benchmarks: bond prices, gold prices, and the US Dollar Index (DXY). It is designed to help traders identify overbought and oversold conditions in the context of these relationships.

How It Works

1. Valuation Ratios: The script calculates the ratio of the primary asset's price to that of bonds, gold, and DXY.
   
2. RSI-Based Analysis: The script uses a modified RSI (Relative Strength Index) to assess the momentum of these ratios over a user-defined lookback period.
   
3. Rescaling & Normalization: To provide a unified view, the valuation metrics are rescaled to a fixed range (-100 to 100), where extreme values can indicate overbought or oversold conditions.
   
   
   Features:
   Customizable Inputs:
   
   1. Lookback period (default: 10).
      
   2. Symbols for bonds, gold, and DXY, allowing flexibility for various trading instruments.
      Visual Indicators:
      
   3. Dynamic plots for each valuation metric (Bond, Gold, DXY).
      
   4. Horizontal lines at key levels (+75, 0, -75) for easy identification of overbought/oversold zones.
      
   5. Cross-Asset Insights: Gain insights into how the asset behaves relative to key market indicators.
      
      How to Use:
      
      1. Add the script to your chart and configure the asset symbols under the settings menu.
         
      2. Observe the plotted lines for each valuation metric:
         
      3. Values above +75 may indicate overbought conditions relative to a benchmark.
         
      4. Values below -75 may indicate oversold conditions.
         
      5. Use in combination with other technical analysis tools for a comprehensive market view.
         
         Note: This script is for educational purposes and should not be considered financial advice. Always perform additional research before making trading decisions.

11. Dez. 2024

Versionshinweise

Updated default DXY Source