Thrax Signals and Overlays

29 dic 2024

Thrax Signals and Overlays is a versatile toolkit offering insights into trends, trade entry/exit points, market sentiment, volatility, and more.


1. Enable Bar Colors:


Turn this on to see candlesticks change colors based on market sentiment.

- Green: Bullish sentiment.
- Purple: Neutral/sideways sentiment.
- Red: Bearish sentiment.

➔ These colors are calculated using a combination of Superbands, ATRs, and momentum.
➔ When a candle turns purple to green, it suggests a shift from neutral to bullish sentiment.
➔ When a candle turns purple to red, it indicates a shift from neutral to bearish sentiment.


2. Enable Buy/Sell Signals:


When this feature is enabled, the indicator provides clear buy and sell signals to help you identify potential trading opportunities.

⚙️ A Buy Signal is indicated by a green arrow, suggesting an upward market movement and an opportunity to enter a long trade.

⚙️ A Sell Signal is indicated by a red arrow, signaling a downward market movement and a potential opportunity for a short trade.

⚙️ Strong Buy and Sell Signals are represented by a "+" symbol, which highlights particularly high-confidence trade signals based on stronger trend alignments.

By enabling this feature, you can quickly spot entry points for your trades with the support of well-calculated indicators, streamlining your decision-making process.


3. Take Profit Points


➔ Green "x": Suggested exit points for bullish trades.
➔ Red "x": Suggested exit points for bearish trades.

These points are calculated using multiple trailing ATRs, allowing you to exit trades in portions.

4. Enable Thrax Shield Zones:


⚙️ When this feature is enabled, the indicator displays dynamic resistance and support zones on your chart, providing valuable insights into key price levels where market trends are likely to react.

➔ The Top Band (Red) represents the Resistance Zone, indicating a price level where upward momentum may slow or reverse as sellers dominate.
➔ The Bottom Band (Green) represents the Support Zone, indicating a price level where downward momentum may slow or reverse as buyers step in.
➔ These zones are calculated using a modified Gaussian filter, which smoothens price data and captures subtle market behaviors. By identifying these zones, you can plan trades more effectively, avoiding entries near resistance and looking for opportunities around support.


5. Plot Dynamic Wave Trail:


⚙️ This feature adds a wave trail to the chart, offering a dynamic and continuous visual representation of market sentiment and momentum.

➔ Blue Wave: Indicates bullish sentiment, suggesting the market is trending upwards with positive momentum.
➔ Red Wave: Indicates bearish sentiment, signaling a downward trend in the market. (This feature will be available soon.)
➔ The wave trail provides an intuitive way to confirm the prevailing market direction, helping traders make more informed decisions about entering or exiting trades.

✦ This can act as support an d resistance as well. When price touches blue trail price reversal in short term is highly possible similarly when price touches red trail price reversal chances are high.

✦ When a buy signal occurs but the Wave Trail is red, it could indicate a false signal, as the bearish sentiment contradicts the buy indication. Similarly, when a sell signal occurs but the Wave Trail is blue, it may also be a false signal, as the bullish sentiment opposes the sell indication. Always cross-reference signals with the Wave Trail to confirm sentiment before making trade decisions, reducing the chances of acting on conflicting or unreliable signals.


6. Enable Dynamic cloud


✦ When enabled it plots a cloud structure on chart. When the trend starts the color of the cloud is darker and then as the trend sustains it lightens out. It helps you identify recent trends ( dark cloud) by differentiating the older trends ( lighter cloud).


7. Enable Trend Catcher & Trend Tracer

⚙️ Trend Tracer


✦ When enabled, it plots a dotted line below the candles. This can be used in conjunction with trail wave to confirm bullish if both is bullish and bearish if both is bearish. This is built by tweaking a lower timeframe super trend.

➔ Confirms bullish sentiment when paired with a bullish wave trail.
➔ Confirms bearish sentiment when paired with a bearish wave trail.

⚙️ Trend Catcher


✦ Displays sharp trend lines on the chart. When enables it displays sharp trend lines which can be used in conjunction with trend catcher and trail wave to confirm trend type.


8. Dashboard


⚙️ When enabled, the dashboard provides key insights into market trends, including trend strength, trend direction, trend volatility, trend sentiment, and trend squeeze.

➔ Trend Strength: Displays a value between 0-100, derived from a combination of RSI and ADX values to indicate the trend's intensity.
➔ Trend Direction: Determines whether the market is bullish or bearish, calculated using RSI, ESAs (Exponential Moving Averages), and trend strength.
➔ Trend Volatility: Measures market fluctuations using Bollinger Bands and the RBI Vigor Index.
➔ Trend Sentiment: Reflects market bias, calculated using moving averages and on-balance volume (OBV).

✦This feature offers a concise overview of market conditions, helping you make informed trading decisions.


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THRAX TRADE SETUP
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⚙️ Trade Setup Guidelines

✪ Aggressive Long Trade Setup:
- Base Setup: Enable Buy-Sell signals, Wave Trail, Bar Coloring, and Shield Zones.
- Wait for a Buy or Strong Buy signal.
- Ensure the Wave Trail is bullish (blue) when the signal occurs.
- Confirm the price is not at the resistance zone (Upper Shield Zone).
- Once all conditions are met, you can initiate a long trade.

✪ Aggressive Short Trade Setup:
- Base Setup: Enable Buy-Sell signals, Wave Trail, Bar Coloring, and Shield Zones.
- Wait for a Sell or Strong Sell signal.
- Ensure the Wave Trail is bearish (red) when the signal occurs.
- Confirm the price is not at the support zone (Lower Shield Zone).
- Once all conditions are met, you can initiate a short trade.


⚙️ Cautious Trade Setup Guidelines

You can follow the Aggressive Long or Short Trade Setup with added confirmations for safer trades:

- Wait for the Aggressive Trade Setup conditions to trigger, then look for the following confirmations:
1. Confirmation 1: The candle color matches the sentiment (Green for bullish, Red for bearish).
2. Confirmation 2: The signal strength in the Dynamic Cloud is strong (dark colors).
3. Confirmation 3: Both Trend Catcher and Trend Tracer align with the sentiment (bullish or bearish).
4. Confirmation 4: Use the Dashboard to confirm the trend's strength, direction, and volatility.
These cautious setups provide additional validation for more reliable trades.