Indicator Types - summary
This page provides a summary of the types
of indicators that are available from us. The menu of buttons to
the left provide access to listings of the actual indicators that
form each group.
Some indicators belong to more than one group. If so, such indicators
are generally listed in all groups to which they can belong. Each
such listing will cross-reference by linkage, to the same details,
and purchase page.
Click on each heading to expose the explanatory text. Click again to toggle the text closed.
The benefit of these kind of indicators is that the user does not have to try to determine the best period to use for the indicator. Instead of using a fixed period (say, the popular 14 or 20 periods) for calculation of the indicator plot, these type of indicators use a factor of the dominant cycle period for the calculation.
An example would be any of the Osi Cycle-Adaptive Stochastics indicators. Stochastics are a momentum type of oscillator that was first described by George Lane. He correctly thought that the best period for calculation of stochastics was half the cycle.
The problem with such a description is that the cycle is itself not a constant, so one is forced to continually change the period as the market progresses, or else run a risk that the indicator is completely irrelevant to the market movement.
In accordance with the original description by George Lane, the Osi Cycle-Adaptive Stochastics indicator uses the calculation for Stochastics, but the calculation period used on each bar is, by default, half the period of the dominant wave as measured on that bar.
This factor of half is adjustable, so that one can use wither the full-cycle for more conservative settings, or the quarter-cycle for more aggressive settings.
This is the scheme used for most of the Osi momentum-style bounded or unbounded oscillators.
The benefit to the user of these kind of indicators is that they take into account the current speed of the market. These type of indicators use either the dominant cycle period or a user-defined fixed period for calculation.
An example would be the Osi Price Proxy. It acts as a proxy for price, smoothing out the price fluctuations, but unlike any kind of fixed-period moving average, it responds very fast when price moves fast, and slows when price changes slowly.
The benefit of using these type of indicators is the same as that which pertains to cycle-adaptive indicators in general, because these type of indicators also use either the dominant cycle period or some factor of same for calculation. Hence, here too, the user does not have to try to determine the best period to use for the indicator. Instead of using a fixed period (say, the popular 14 or 20 periods) for calculation of the indicator plot, these type of indicators use a factor of the dominant cycle period for the calculation. They are generally classified as cycle-adaptive indicators.
They tend to be classified often as unbounded oscillators. An example would be the Osi Cycle-Adaptive Fisher Transform or the Osi Cycle-Adaptive CCI. We class them as dispersion indicators because they are really a measure of the dispersion of the statistical distribution of price, and an attempt to take advantage of mean-reversion tendencies.
The benefit of these indicators is that they are based entirely on the statistics of immediate past price movement. Thus they provide a good measure of the probability of making a profit, based on how far they are located from their initial datum.
They print out on the screen, a precise price at which there is a precise probability of having a profitable exit from a trade. They are based on sound statistical principles, and provide a good measure of whether a trade may not be worthwhile, because the reward/risk ratio is not favorable.
As these indicators provide precise exit prices, the reward/risk ratio can be calculated/estimated with exactitude before the trade is entered.
The benefit of these kind of indicators are that they provide an advance indication of where the market is likely to go in the immediate future. These type of indicators are not necessarily cycle based, though they can be. They may be considered to be volatility based.
They generally use measures of market thrust and retracement, as they attempt to determine the subsequent direction of market prices.
These type of indicators are useful to the trader because they examine price with a view to determine when the price movement is exhausted in a direction and likely to mark a reversal zone for the subsequent price action. These type of indicators are not cycle based at all. They may be considered to be volatility based, as they are attempting to determine when market momentum reverses.
This is done by examining the market's price speed, range and volume. The observation is that when these are well in excess of their most recent values, it usually marks a point of price exhaustion. Thus these kind of indicators are more or less, indicators of support and resistance.
A trader can always benefit from knowing whether that market is trending or trading in a range. That is the benefit that these indicators provide.
The main one here is called the Osi Cycle-Trend Discriminator and is based on both cycle action and volatility, using the juxtaposition of these indicator lines to determine the market state.
Many bounded indicators are often used for this purpose, and any of the cycle-adaptive indicators available here can be so used.
It is useful for a trader to know in which direction money is flowing in the market.
These indicators attempt to track the flow of money into and out of equities. They combine price and volume, and tend to be used as divergence indicators, though many traders also use them as confirming indicators. The ones offered here are generally volatility adjusted, on a relative basis, on each bar.
The two basic type of indicators are bounded or unbounded. Bounded oscillators have have a maximum and minimum value: unbounded oscillators do not. Oscillators make ideal candidates to be designed as cycle-adjusted indicators, and many of those here are such.
For many oscillators, the optimum period over which to calculate is half the period of the dominant cycle. If you consider the case of an idealized varying wave, a sine wave, it is obvious that the low to high point of the wave are separated by half the period of the wave.
Testing against an idealized wave, led us to design the bounded oscillators to use half the period of the dominant cycle for calculation: unbounded oscillators may use either the full period, half the period or a quarter of the period, as the user chooses.
These type of indicators are need not be cycle based at all. They may be considered to be volatility based, as they are attempting to determine when market momentum reverses. Often, they are based entirely on how price behaves, with no other considerations.
However, in reality, they may take other factors, such as the speed of the tape, into account. They are, correctly, indicators of support and resistance, though they can also be indicators of continuation of price moves.
There is great benefit to knowing where the market is likely to find support or meet resistance.
Like Market Exhaustion Indicators, these type of indicators are not cycle based at all. In fact, they are often the same kind of indicators. They are used to try to determine if the market will reverse or continue in its direction, They may be considered to be volatility based, as they are attempting to determine when market momentum reverses.
These are of greatest benefit to those who trade with the trend. While often called momentum traders, trend traders are not necessarily trading based on the market speed, but rather on its perceived direction. Such traders are willing to buy at recent highs with the expectation that the market will continue to make newer highs, and to sell at lows, with the expectation of continued action in the same direction.
These type of indicators make good price filters, based on past action. Some of those here are cycle-adjusted, and many are not, especially if they are using multiple plots in a comparative manner.
Prime examples of such are the Osi_Ichimoku Indicator and its companion, the Osi_Ichimoku Scanner. By comparing the accepted measures of bullish/bearish tendency that are measured by Ichimoku, to the user-determined Ichimoku crieteria, the Osi_Ichimoku Scanner can be used to even more quickly determine how bullish or bearish the market is relative to the user's specified criteria. By using a visual interface that colors the chart, a trader can receive early indications that the market is about to take off in the previous trend direction.
Many traders swear by the benefits of knowing the volumes at which the market is trading at any time.
These type of indicators are based on volume action, and may or not incorporate price in their calculation. Some of those here are based on both price and volume action, and attempt to determine market exhaustion points. Such indicators may depend entirely on comparative analysis of adjacent bars, and involve no other arithmetic.
For starters, we are not talking about Elliot Wave here. Though we do have an indicator we call the Osi Objective Wave, which does attempt to draw similar waves, based on objective counts. It uses Fibonacci counts and ratios in attempting to project targets for waves 3 and 5, after they are confirmed to be underway.
These type of indicators are not necessarily cycle-based in their calculation. Some of those available here are, and some are not. They may be used variously: directly as filters for buy and sell signal generation; as projectors for targets, or as confirmation filters.
Free NinjaTrader Indicators
These are NinjaTrader indicators that are being released for free. They may already have been posted on fora or other bulletin boards. They are all posted with the requisite permission of the authors.
Free thinkorswim Indicators
These are thinkorswim® indicators that are being released for free. They may already have been posted on fora or other bulletin boards. They are all posted with the requisite permission of the authors.
Cycle-Adaptive Indicators