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Spread Oscillator
Source: https://fxcodebase.com/code/viewtopic.php?f=17&t=36328
Forum: 17 · Topic 36328 · 18 post(s)
Spread Oscillator
Apprentice · Fri May 03, 2013 4:14 am
Ratio = (First Instrument / Second Instrument)*100 Spread Oscillator = Long MA of Ratio - Short MA of Ratio
Spread Oscillator with Normalization.lua
MT4/Mq4 version. viewtopic.php?f=38&t=64942&p=113699#p113699
Re: Spread Oscillator
Apprentice · Tue May 07, 2013 5:00 am
Zero line Added.
Re: Spread Oscillator
Jeffreyvnlk · Tue May 07, 2013 7:13 am
Apprentice wrote: Zero line Added.
Thanks
Normalization
Jeffreyvnlk · Thu May 23, 2013 3:55 pm
Is there a way for normalization this Spread Oscilator for 3 year ? Like constructing of COT index Subtracting by exponential moving averages is appreciated
Re: Spread Oscillator
Apprentice · Fri May 24, 2013 3:31 am
Normalization algorithm is as follows. Subtract exponential moving of spread from the spread?
Re: Spread Oscillator
Jeffreyvnlk · Wed May 29, 2013 12:49 pm
Apprentice wrote: Normalization algorithm is as follows. Subtract exponential moving of spread from the spread?
Thank Spread Oscillator = Long EMA of Ratio - Short EMA of Ratio
Re: Spread Oscillator
Jeffreyvnlk · Wed May 29, 2013 12:54 pm
Just like an orginal request, using EMA appreciated. And adding Zero line , please
Jeffreyvnlk wrote: It was appreciated if you could make this indicator called Spread Oscillator (SO):
A. Modified spread: dividing 1 instrument by 2rd and then multiplying by 100 B- Subtract a 5-period exponential moving average of A from a 15- period exponential moving average of A as well
Long and short 1st instrument when SO crossing above or below Zero line
Thanks in advance
Re: Spread Oscillator
Apprentice · Mon Jun 03, 2013 11:25 am
Normalization option added.
Re: Spread Oscillator
Jeffreyvnlk · Tue Jun 04, 2013 6:30 am
Perfect, you save me
Re: Spread Oscillator
Jeffreyvnlk · Sat Jul 06, 2013 3:08 am
Apprentice wrote:
Spread Oscillator.png
Ratio = (First Instrument / Second Instrument)*100 Spread Oscillator = Long MA of Ratio - Short MA of Ratio
Spread Oscillator.lua
Spread Oscillator with Normalization.lua
Your Spread Oscillator based on moving average was great. May I propose another method which based on percentage change movements as following: =============== Input: Length(20) Value1(( C/C[Length])- C Data2/C[Length] Data2))*100; =================== I called it as Spread Momentum (SM) and it could be easier to use for trading. Use 2 levels for extremes and Zero line. It would be fantastic if you could paint the price bars when SM reaching extremes Thanks
Re: Spread Oscillator
Apprentice · Sat Jul 06, 2013 11:13 am
Is this correct formula Value1 = (( Close[period]/Close[period- Length])- Data[Period]/Data[period-Length] ))*100;
Re: Spread Oscillator
Jeffreyvnlk · Sat Jul 06, 2013 11:33 am
Apprentice wrote: Is this correct formula Value1 = (( Close[period]/Close[period- Length])- Data[Period]/Data[period-Length] ))*100;
Thank but may I move back to express by language literally
A.Dividing the price of Instrument 1 to that of Instrument 2 B. Doing the same but for a period (length) looking back C. A minus B and divide to 100 D. Plot on the chart as an Oscillator with over/under value levels and Zero line
Strategy for trading: it advisable to wait the Oscillator from extreme levels (over/under value btw 2 instruments) crossing Zero line in order to long/short accordingly Not only for trading but using for analysis. Right now XAU still overvalue to Bond so XAU would go lower, even go down faster because bond also in a down trend. Regarding USD cycles, XAU could go to 800$
Thank you for helping
Re: Spread Oscillator
Apprentice · Sat Jul 06, 2013 11:37 am
Can you revise your formula.
Re: Spread Oscillator
Jeffreyvnlk · Tue Jul 09, 2013 2:48 am
Apprentice wrote: Is this correct formula Value1 = (( Close[period]/Close[period- Length])- Data[Period]/Data[period-Length] ))*100;
I think this is correct
Re: Spread Oscillator
Apprentice · Tue Jul 09, 2013 4:26 am
Try this version Spread Oscillator=((Close[period]/Close[period- Length])- Data[Period]/Data[period-Length]))*100;
Re: Spread Oscillator
Jeffreyvnlk · Sat Jul 20, 2013 7:25 am
Thank you
May I come back to OP ? I see your indicator great potential Larry Williams suggest all instruments comparing to gold. Over a century,always 1 ounce of gold can buy you a nice suit ! So in term of currencies index he suggested the currency will be against 3 other stuff: gold, T-bond and USD index
I don’t know here we have currencies indexes or not but let tweak this spread oscillator more.For example, under EUR/USD chart, instead of 3 underneath windows for 3 oscillators (EUR/USD vs. Gold/Bund/FXCM’s USD index) , there would be just 1 window for all 3 ? Thanks
Larry W said about the concept of valuation. It different from oversold/overbought. Sometime the instrument oversold but not yet under valuation, shorting not recommended. In practice,when you see EUR over valuated to gold and USDindex (2 out of 3), preparing to short EUR.
Re: Spread Oscillator
Apprentice · Fri Jun 22, 2018 8:15 am
The indicator was revised and updated.
Re: Spread Oscillator
Emma_202 · Tue Aug 25, 2020 11:55 am
Jeffreyvnlk wrote: Thank you
May I come back to OP ? I see your indicator great potential Larry Williams suggest all instruments comparing to gold. Over a century,always 1 ounce of gold can buy you a nice suit ! So in term of currencies index he suggested the currency will be against 3 other stuff: gold, T-bond and USD index
I don’t know here we have currencies indexes or not but let tweak this spread oscillator more.For example, under EUR/USD chart, instead of 3 underneath windows for 3 oscillators (EUR/USD vs. Gold/Bund/FXCM’s USD index) , there would be just 1 window for all 3 ? Thanks
Larry W said about the concept of valuation. It different from oversold/overbought. Sometime the instrument oversold but not yet under valuation, shorting not recommended. In practice,when you see EUR over valuated to gold and USDindex (2 out of 3), preparing to short EUR.
Has anyone tested this indicator to see how well it performs?
The Williams Valuation concept should in theory be relevant to understand how an economy, and by proxy its currency, is valued by investors.