IVO Trend Indicator 2.0

IVO Trend Indicator

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OBJECTIVE
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As we all know, there are a multitude of indicators that aim to improve our trading operations, but many of them are confusing, and using several simultaneously can lead to trading errors. The indicator we have developed is based exclusively on the use of moving averages, so that together they are able to more accurately detect three important trading factors: TREND, STRENGTH, and MOMENTUM.

--> Trend : Price trend

--> Strength : Whether the price has bullish or bearish strength regardless of the overall trend of the chart

--> Momentum : Current state of that force, that is, whether it is still strong or losing intensity


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WHAT DOES THE SCRIPT DO ?
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The script detects the trend, strength and momentum of an instrument (stocks, indices, etc.) of the main time frames and displays them in a summary table, in addition to indicating them on the chart itself.

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HOW IT DOES ?
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To calculate these 3 variables, the script uses 4 moving averages in the different time frames and, using their crossovers and slopes, detects their trend, strength and momentum and displays them in the summary graph and table.

1) TREND

Using two moving averages, we detect the chart's trend depending on how they cross and separate, so that the result will be (BULL, BEAR, NEUTRAL).

2) STRENGTH

Using two more moving averages, we detect the strength at that moment, that is, where the price is headed, regardless of its trend. The result will be (BULL, BEAR, NEUTRAL).

3) MOMENTUM

Using the intersection of two moving averages, we detect momentum, so that we know if the strength is still active in the same direction or is losing strength. The result will be (BULL, BEAR, NEUTRAL).

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HOW TO USE IT ?
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1) The first variable to use will be the trend. If it's bullish, we'll only look for long positions, and if it's bearish, we'll only look for short positions.

2) Once we have the first variable set, we'll go to the strength, which will give us the signal to buy or sell when the bull or bear message appears on the chart.

3) We'll use the momentum variable TO EXIT an open trade if it appears against the direction of our trade, as this will indicate that the trend is losing strength and the price could reverse. To do this, we'll look at the small triangles below.

Furthermore, if we want to be more conservative, we will only trade when the higher timeframe has the same trend and strength as the timeframe we want to trade.

Examples:

If we trade on M5, H1 must have the same trend and strength.
If we trade on M15, H4 must have the same trend and strength.
If we trade on H1, Daily must have the same trend and strength.

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CONTROL TABLE
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The main advantage of the indicator is that it calculates the three variables (trend, strength, momentum) in the main timeframes and displays them in a control table so we can see the current price status at a glance.

It will also display a message for each timeframe as the sum of the three variables, so we know what's happening at any given moment without having to analyze anything.

Three types of messages for each timeframe (e.g., Weekly):

1) Weekly: BULLISH (losing strength) --> It's bullish, but it's losing strength because the momentum is bearish.
2) Weekly: BULLISH --> It's bullish.
3) Weekly: BULLISH (retracement) --> It's bullish in a retracement phase because its strength is bearish.

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GRAPH DISPLAY
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1) The control table: (This is optional to display).
2) The 4 Moving Averages: (This is optional to display and the colors can be changed).
3) Bull or Bear signals based on strength: Bull or Bear messages will appear on the chart each time the strength changes value. (This is also optional to display and the colors can be changed).
4) Triangles at the bottom of the chart indicating price momentum: (This is also optional to display).

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WHY ITS WORTH USING THIS INDICATOR
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1) Using a chart, we can see the trend, strength, and momentum of an instrument in the main time frames in just one second, allowing us to act accordingly.

2) The colors and warnings in the chart are clear and concise, so you know what to do at any given time.

3) Facilitates the input signal without room for misunderstanding.

4) The colors and the way the chart is displayed improve visual accessibility, making it easier to see what's happening with the price.

--> IN SUMMARY

Very powerful and easy to use indicator at the same time.

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For more information, please contact us in my TradingView profile: jmesado

Thank you very much, and we will continue to update the indicator with improvements we already have in mind.

Greetings, TradingView community.