TradingView – Indicators
In this article will look into TradingView – Indicators what are they? Types of ? Which indicators should be used etc.
Indicators
First lets open the indicators menu for that click on Indicators on the top menu and voila “Indicators, Metrics and Strategies” pops up. Image is show below.
As you can see in the image above the “Indicators” are listed in the “Technicals“. A technical indicator helps a trader analyze the price movement of a security.
Quick Tip for learning any new indicator.
Lets say you want to learn what the 24-hour Volume is about. In the image above you can see the 24-hour Volume highlighted and you can see on the right side of the 24-hour Volume a grey circle with question mark. If you click on it you can see the description of the indicator i.e. Definition, Calculation, What to look for, Inputs, Examples etc. You can see in the image below
As you know we use less indicators in our trading and as you progress through our course article you will know why is this but in short the ones we use are for only conforming the already decided future direction through our Price Action analysis.
So if you are not taken this course Click Here to check syllabus for our trading course called Trading with PAV and Enroll NOW. Also if you don’t need the course and are already achieved consistent profitability in trading check our Volume Profile & VWAP tools to get an edge in market with our custom built Indicators. Now lets get to know what is Indicator.
What is an Indicator
Indicators are quantitative analysis tools used to interpret stocks or current status and future trends in the stock market. They are mathematical formulas and ratios used to predict how the market will move based on applying a statistical formula to a set of data points to make conclusions on market movements.
Moving Averages
Lets take a example of an indicator called Moving Averages. Before we learn moving averages, let us have a quick recap on how averages are calculated.
Assume 5 people are sitting on a nice sunny beach enjoying a nice chilled bottled beverage. The sun is so bright and nice that each one of them ends up drinking several bottles of the beverage. Assume the final count to be something like this:
| Sr No | Person | No of Bottles |
|---|---|---|
| 01 | A | 07 |
| 02 | B | 05 |
| 03 | C | 06 |
| 04 | D | 03 |
| 05 | E | 08 |
| Total no of bottles consumed | 29 | |
Assume a 6th person walks in to find out 29 bottles of beverages lying around them. He can quickly get a sense of ‘roughly’ how many bottles each of them consumed by dividing [the total number of bottles] by [total number of people].
In this case, it would be:
=29/5
=5.8 bottles per head.
So, the average, in this case, tells us roughly how many bottles each person had consumed. Obviously, there would be few of them who had consumed above and below the average. For example, Person E drank 8 bottles of beverage, which is way above the average of 5.8 bottles. Likewise, person D drank just 3 bottles of beverage, which is way below the average of 5.8 bottles. Therefore the average is just an estimate, and one cannot expect it to be accurate.
Extending the concept to stocks, here are the closing prices of ITC Limited for the last 5 trading sessions. The last 5-day average close would be calculated as follows:
| Date | Closing Price |
|---|---|
| 17/10/22 | 344.95 |
| 18/10/22 | 342.35 |
| 19/10/22 | 344.20 |
| 20/10/22 | 344.25 |
| 21/10/22 | 344.0 |
| Total | 1719.75 |
= 1719.75 / 5
= 343.95
Hence the average closing price of ITC over the last 5 trading sessions is 343.95.
We are essentially moving to the latest data point and discarding the oldest to calculate the latest 5-day average. Hence the name “moving” average!
In the above example, the calculation of the moving average is based on the closing prices. Sometimes, moving averages are also calculated using other parameters such as high, low, and open. However, the closing prices are used mostly by the traders and investors as it reflects the price at which the market finally settles down.
Moving averages can be calculated for any time frame, from minutes, hours to years. Any time frame can be selected from the charting software-based of your requirements.
Applying indicators in TradingView
- Lets go to TradingView and Open the chart of SBIN 1D timeframe.
- Click on Indicators in the top menu.
- Select “Technicals” and in right make sure you are in “Indicators” tab.
- Search for “Moving Average” the list is alphabetically listed.
- After you find it yo can even read the description on clicking right side question mark or else click on it.
- Close the indicator panel and voila. Below the volume Indicator in the status bar section you can see the “MA 9 close 0 SMA 5” what this means is that Moving Average is set on length 9 and source for calculation is Close and line offset on is set to 0 also SMA mean Smoothing MA line length is 5. This information is helpful for quick glance on what setting are in place.
- Now hover over the “MA 9 close 0 SMA 5” in status line you will see options like eye which hides the MA from chart, Gear ⚙️ which opens settings, { } which opens the Source code for MA, X which removes the indicator from chart, ··· which opens a menu (imp from this menu are Alert and visual order to bring in front or back of the candlestick chart)
- Clicking on Gear icon open settings panel for MA you can change the “Inputs” which we see at glance in the status line “MA 9 close 0 SMA 5“
- Clicking on “Style” lets you change MA line color, width and how should it be displayed.
- All the above structure is same for all indicators, change is only in indicators working, inputs, style etc. If you get stuck you always have (?) Show description on the right side of every indicator that you can learn from.
Invite-only scripts
If you have bought the course “Trading with PAV” or the “Volume Profile & VWAP tools” you get our custom built Volume Profile – Flexible, VWAP, Volume Profile PLUS – Vol based S/R Zones and some BONUS indicators which are Rejection Candles – with volume, Relative Strength Index – Custom RSI, Multi-Time Period Charts, Volume Indicator: Future vol on Spot.
All these are activated by us when your billing is conformed and then there is one more option activated i.e. “Invite-only scripts” in the indicators pop up. If you haven’t purchased you wont see it. Look at the below image.
As you can see in the above image all the above mentioned indicators are included by us for lifetime. How to use each “indicators” from the “Invite-only scripts” you will learn later also strategies based on these will be in coming articles which will be only available to our traders who purchased.
Add to favorites
In the above image of “Invite-only scripts” you can see star on the highlighted indicator called “Multi-Time Period Charts YSTC“. If you click on the star it is added to favorites. Star all the 8 listed indicators and you can easily access them from top menu drop-down menu near indicators. See the image below.
As you can see you can quickly select any indicator quickly use and remove it from chart. You can favorite any indicator you like and as TradingView’s Free account has a limit of displaying 3 indicators you can use favorite to your advantage. That’s it for this article on indicators.
