Weis Wave Volume - Simple labels and comparison

28 mar 2023

This script is designed to identify and display the Weis Wave Volume on a chart. The Weis Wave Volume is a volume-based indicator that helps traders analyze market waves, identify trend reversals, and assess the strength of a trend. The script calculates wave volume based on user-defined input parameters, detects price waves, and displays the results as labels on the chart.

This version in particular is based on ideas from the_MarketWhisperer and some other pieces of the script from @LucF.

The overall functionality of the script is to identify price waves and their corresponding volume. It does this by determining the trend direction and detecting trend reversals based on user-defined inputs such as the Trend reversal length and Price source for trend detection. The script also calculates and displays the cumulative volume of the current wave, the number of bars in the wave, the average volume in the wave, and consecutive increasing average volume bars in the same wave:

- An 'o' is printed to show that the volume of the current wave was 'O'ver/ above the count of the volume from preceding wave (regardless of it being up or down).
- An 'u' is printed to show that the volume of the current wave was 'U'nder/ below the count of the volume from preceding wave (regardless of it being up or down).
- Current wave will be between '[ ]' signaling that the wave is not confirmed yet.
- Actual values for the wave are available as tooltips. You decide how many bars to show the labels for, but for now and since I am a fan of clean charts, this is set to 50.

The user can adjust various inputs that affect the output of the script, such as Trend reversal length, Price source for trend detection, Labels for X last bars. Adjusting these inputs allows the trader to customize the script's behavior to better suit their trading style or specific market conditions. For example, by increasing the Trend reversal length, the script will require more consecutive bars in the opposite direction to confirm a trend reversal, potentially filtering out shorter-term price fluctuations. Similarly, adjusting the Price source for trend detection allows the user to base trend calculations on different price values, such as the high, low, or close of each bar.

In addition to the customizable inputs, the user can enable or disable the display of pivot markers and choose the colors for the up and down volume labels. This helps the trader to easily visualize and analyze the wave volume information on the chart.

In summary, this script offers traders a powerful tool for visualizing and analyzing the Weis Wave Volume on a chart. By identifying price waves, detecting trend reversals, and providing insights into the strength of a trend based on volume, the script can be a valuable addition to a trader's technical analysis toolbox. Please note this is not meant to provide any buy or sell signals, it should be rather used to complement your existing analysis.

Have fun and trade wisely ;)