Trend Composite (Auto 125d + Daily Overlay)

Arthur Hill’s Trend Composite is a multi-factor trend indicator designed to quantify the overall trend strength of any market. Instead of relying on a single moving average or MACD signal, the Trend Composite combines five proven long-term trend measures into one clear score.

The indicator outputs a value from –5 to +5, where:

+5 → Strong uptrend

0 → Neutral / transition zone

–5 → Strong downtrend

A higher score means more trend components are aligned bullishly. A lower score means multiple trend components are pointing bearish.

The Trend Composite evaluates:

Price vs 100-day SMA

Price vs 200-day SMA

50-day SMA vs 200-day SMA

Slope of the 200-day SMA

MACD line vs Signal line

Each component votes +1 (bullish) or –1 (bearish), and the sum becomes the Trend Composite score.

Why This Indicator Works

Trend signals by themselves can be noisy or lagging. When you combine multiple uncorrelated trend measures, you remove false positives and get a cleaner picture of market direction. The result is a powerful, balanced trend filter that works across stocks, crypto, forex, indices, and commodities.

How Traders Use It

Trend filter for long trades: Only trade long when the score is ≥ +3

Avoid chop: Stay out when the score is between –2 and +2

Short setups: Look for –3 or lower

Watchlist ranking: Sort symbols by composite score to find the strongest trends

Stage analysis: Helps identify clear Stage 2 uptrends and Stage 4 downtrends

This makes it ideal for systematic traders, swing traders, trend followers, and anyone building rule-based strategies.

Notes

This is not a buy/sell signal on its own — it’s a trend framework. Combine it with volume patterns, relative strength, volatility contraction, or your preferred entry setup for best results.