WaveTrend Oscilator
- Indicatori
- Ibrahim Kisioglu
- Versione: 1.0
Wavetrend Oscillator – Indicator Description
The Wavetrend Oscillator is a momentum-based technical indicator that helps traders identify overbought and oversold conditions, trend strength, and potential trade entry/exit points. It is particularly effective for scalping and swing trading, as it incorporates multi-timeframe (MTF) analysis by integrating higher timeframe trend confirmation.
📌 Key Features
✔️ WT1 & WT2 Crossover System – Identifies momentum shifts and potential trade signals.
✔️ WT3 (Higher Timeframe Confirmation) – Uses H4 trend filtering to improve accuracy.
✔️ Dynamic Support/Resistance – Based on EMA calculations of price movement.
✔️ Color-Coded Histogram (WT3 Pos/Neg) – Clearly differentiates bullish and bearish conditions.
✔️ Overbought/Oversold Levels – Detects potential reversals with customizable thresholds.
📊 How It Works
1️⃣ WT1 (Green) & WT2 (Red) – Main Oscillator Lines
-
A WT1 crosses WT2 upwards → Bullish Signal
-
A WT1 crosses WT2 downwards → Bearish Signal
2️⃣ WT3 (Blue Histogram) – Trend Confirmation from Higher Timeframe (H4)
-
WT3 > 0 (Lime) → Higher TF confirms an uptrend (favoring long trades).
-
WT3 < 0 (Red) → Higher TF confirms a downtrend (favoring short trades).
3️⃣ Overbought & Oversold Zones
-
Above 50 (Overbought) → Potential reversal or trend continuation.
-
Below -50 (Oversold) → Possible buying opportunity.
📈 Trading Strategy
🔹 Buy Signal:
✔️ H4 WT3 is Positive (Green Histogram)
✔️ WT1 crosses above WT2
✔️ WT1 & WT2 above Oversold (-50) level
✔️ Entry: On next candle close after confirmation.
🔹 Sell Signal:
✔️ H4 WT3 is Negative (Red Histogram)
✔️ WT1 crosses below WT2
✔️ WT1 & WT2 below Overbought (+50) level
✔️ Entry: On next candle close after confirmation.
🔹 Exit Strategy:
✔️ Exit at previous resistance/support or opposite WT1-WT2 crossover.
⚙️ Customizable Inputs
-
Higher_TF (Default = H4) → Change higher timeframe for trend filtering.
-
Channel_Length & Average_Length → Adjust for sensitivity.
-
Signal_Length → Determines how reactive the signal line is.
-
Overbought/Oversold Levels → Fine-tune reversal detection.
📌 Why Use This Indicator?
✅ Reduces false signals by filtering through higher timeframe trends.
✅ Combines momentum and trend confirmation for higher accuracy.
✅ Works on multiple assets including Forex, Stocks, Crypto, and Indices.
✅ Ideal for scalping & swing trading with fast-reacting signals.
