OPEN-SOURCE SCRIPT
SMH DualMomentum Signals (ROC + Volume)
SMH Dual Momentum (ROC + Volume Confirmation)
This indicator identifies high-quality bullish trends by combining price momentum (Rate of Change) with volume confirmation, and exits when momentum structurally fails.
Core Logic
BUY signal
Rate of Change (ROC) over N periods is above a positive threshold (strong upside momentum)
Current volume is above its moving average (rising market participation)
SELL signal
ROC crosses below zero, indicating loss of bullish momentum
Why It Works
ROC measures the speed and strength of price movement, filtering out weak or drifting trends
Volume confirmation ensures momentum is supported by real capital flow, reducing false breakouts
Momentum-based exit avoids prolonged drawdowns and capital stagnation
Key Advantages
Focuses on trend continuation, not prediction
Filters out low-quality price moves and range-bound markets
Captures long, high-conviction trends with relatively few trades
Simple, robust rules using only price and volume
Best Use Cases
Designed for trend-driven ETFs such as SMH (Semiconductors)
Suitable for swing to position trading on daily charts
Works best in markets with strong sector rotation and institutional participation
Notes
This is a trend-following momentum tool, not a mean-reversion indicator
No stop-loss is built in; risk management should be handled externally if required
Parameters can be adjusted to match different timeframes or assets
This indicator identifies high-quality bullish trends by combining price momentum (Rate of Change) with volume confirmation, and exits when momentum structurally fails.
Core Logic
BUY signal
Rate of Change (ROC) over N periods is above a positive threshold (strong upside momentum)
Current volume is above its moving average (rising market participation)
SELL signal
ROC crosses below zero, indicating loss of bullish momentum
Why It Works
ROC measures the speed and strength of price movement, filtering out weak or drifting trends
Volume confirmation ensures momentum is supported by real capital flow, reducing false breakouts
Momentum-based exit avoids prolonged drawdowns and capital stagnation
Key Advantages
Focuses on trend continuation, not prediction
Filters out low-quality price moves and range-bound markets
Captures long, high-conviction trends with relatively few trades
Simple, robust rules using only price and volume
Best Use Cases
Designed for trend-driven ETFs such as SMH (Semiconductors)
Suitable for swing to position trading on daily charts
Works best in markets with strong sector rotation and institutional participation
Notes
This is a trend-following momentum tool, not a mean-reversion indicator
No stop-loss is built in; risk management should be handled externally if required
Parameters can be adjusted to match different timeframes or assets
Script de código abierto
Fiel al espíritu de TradingView, el creador de este script lo ha convertido en código abierto, para que los traders puedan revisar y verificar su funcionalidad. ¡Enhorabuena al autor! Aunque puede utilizarlo de forma gratuita, recuerde que la republicación del código está sujeta a nuestras Normas internas.
Exención de responsabilidad
La información y las publicaciones no constituyen, ni deben considerarse como asesoramiento o recomendaciones financieras, de inversión, de trading o de otro tipo proporcionadas o respaldadas por TradingView. Más información en Condiciones de uso.
Script de código abierto
Fiel al espíritu de TradingView, el creador de este script lo ha convertido en código abierto, para que los traders puedan revisar y verificar su funcionalidad. ¡Enhorabuena al autor! Aunque puede utilizarlo de forma gratuita, recuerde que la republicación del código está sujeta a nuestras Normas internas.
Exención de responsabilidad
La información y las publicaciones no constituyen, ni deben considerarse como asesoramiento o recomendaciones financieras, de inversión, de trading o de otro tipo proporcionadas o respaldadas por TradingView. Más información en Condiciones de uso.