Brown's Exponential Smoothing Volatility Adjusted (BESVA)Introduction:
This script is a technical indicator for financial markets, designed to provide traders with a smoothed version of an asset's price using Brown's exponential smoothing method. The indicator adjusts the smoothing parameter based on the volatility of the asset, resulting in a smoother plot with less volatility and a quicker response to price changes with higher volatility.
Methodology:
The indicator begins by defining a length parameter, which determines the number of bars used in a volatility calculation. The user can input a value for this parameter, with a default of 20 bars.
Next, the script calculates the standard deviation of the asset's close price over the defined length, which serves as a measure of volatility. The standard deviation is then normalized by dividing it by the maximum standard deviation and adding a minimum value (set to 0.00005 by default). This normalization technique ensures that the indicator is comparable across different asset classes and time frames.
The normalized volatility measure is then used to adjust the smoothing parameter for the exponential moving average. Specifically, the smoothing parameter is set to the normalized volatility measure, with the minimum value used when the volatility is at its minimum. As the volatility increases, the smoothing parameter decreases, resulting in a quicker response to price changes.
The resulting smoothed price plot is then plotted on the chart.
Conclusion:
This script provides a useful tool for traders looking to analyze the trends in an asset's price while taking into account its volatility. The adjustable smoothing parameter ensures that the indicator responds appropriately to changes in volatility, making it a valuable addition to a trader's toolkit.
Browns
Brown's Exponential Smoothing Tool (BEST)Brown's Exponential Smoothing Tool (BEST) is a script for technical analysis in financial markets. It is designed to smooth out price fluctuations and identify trends in a given time series data.
The script begins by defining the "BEST" indicator, which will be overlaid on top of the chart. The user can then specify the source of the data (e.g. close price) and set the values for the smoothing factor (alpha) and the style of exponential smoothing (BES, DBES, or TBES).
The script then defines three functions for calculating the exponential smoothing: "bes", "tbes", and "dbes". The "bes" function applies a single iteration of exponential smoothing to the input data, using the specified alpha value. The "tbes" function applies three iterations of exponential smoothing, using the triple exponential moving average (TEMA) formula to smooth out the data even further. The "dbes" function applies two iterations of exponential smoothing, using the double exponential moving average (DEMA) formula to smooth out the data.
Finally, the script defines a "ma" function, which returns the exponential smoothing result based on the style selected by the user. The script plots the result of the "ma" function on the chart, using the color orange.
In summary, Brown's Exponential Smoothing Tool is a script for smoothing out financial time series data and identifying trends. It allows the user to choose from three different styles of exponential smoothing, each of which has its own strengths and weaknesses. By applying exponential smoothing to financial data, traders and analysts can better understand the underlying trends and make more informed decisions.
Triple Brown's Exponential Smoothing (TBES)This script is a PineScript implementation of the Triple Exponential Moving Average (TEMA) indicator, which is a trend-following indicator used in technical analysis. The TEMA attempts to reduce the lag present in other moving averages by using a triple exponential smoothing technique.
The script begins by declaring the function "indicator" with the name "TBES", and setting the "overlay" parameter to "true" to display the indicator on top of the price chart. It also defines an input parameter called "Source" which is the source data for the TEMA calculation (usually the closing price of a financial asset). It also defines an input parameter called "Alpha" which is a smoothing factor that controls the weighting of the TEMA calculation.
The script then defines the "bes" function, which stands for "Brown's Exponential Smoothing". This function takes in the source data and the alpha smoothing factor as input, and applies the double exponential smoothing calculation to produce a smoothed version of the source data.
The "tbes" function is then defined, which stands for "Triple Brown's Exponential Smoothing" and calculates the TEMA. It does this by first applying the "bes" function to the source data, then applying it again to the output of the first "bes" calculation, and then applying it a third time to the output of the second "bes" calculation. The final TEMA value is then calculated as the sum of three times the difference between the output of the first "bes" calculation and the output of the second "bes" calculation, and the output of the third "bes" calculation.
Finally, the script plots the TEMA value on the chart in green color by calling the "plot" function and passing it the output of the "tbes" function, along with a string label for the indicator.
Double Brown's Exponential Smoother (DBES)The Double Browns Exponential Smoother (DBES) is a trend-following indicator that reduces the lag present in other moving averages by using a double exponential smoothing technique. It takes in the source data and a smoothing factor as input and produces a smoothed version of the source data. The DBES is then calculated as the difference between twice the output of the first smoothing calculation and the output of the second smoothing calculation. The DEMA is useful for traders looking to identify trends in the markets.
