Stochastic Heat Map

The Stochastic Heat Map indicator visualizes momentum across multiple timeframes simultaneously using a vertically stacked array of stochastic oscillators to identify trend strength and exhaustion points.

Usage

The Usage section describes how the script can be used to identify market conditions through color-coded momentum gradients.

• Momentum Analysis: The heat map displays shorter-term stochastics at the bottom and longer-term stochastics at the top. A uniform color across the vertical stack indicates strong trend agreement across multiple lookback periods.
• Exhaustion and Reversal: When the heat map transitions from intense "hot" or "cold" colors to neutral tones, it suggests a potential loss in momentum or a forthcoming reversal.
• Oscillator Crossovers: The script calculates a "Fast" line (the average of all active stochastics) and a "Slow" signal line. Traders can look for crossovers between these two lines for entry or exit signals.
• Bar Coloring: By enabling the "Paint Bars" feature, the candles on the main chart will reflect the average momentum value, allowing for trend identification without constantly looking at the oscillator pane.

Details

The Stochastic Heat Map constructs its visual output by plotting up to 28 individual stochastic oscillators. Each oscillator’s value is mapped to a specific color gradient: values above 50 represent bullish momentum (typically greens or blues depending on the theme), while values below 50 represent bearish momentum (typically reds or purples).

The script offers two calculation modes for the lookback periods:

1. Linear Increment: Each subsequent stochastic increases its length by a fixed value.
2. Wave Method: When the "Waves" toggle is enabled, the lookback lengths and smoothing are weighted differently to provide a non-linear distribution of timeframes.

The aggregate momentum is derived by averaging the values of all active oscillators, which is then plotted as the Fast oscillator line.

Settings

• MA: Selects the smoothing method used for the stochastic calculations (SMA, EMA, or WMA).
• Theme: Switches between three distinct color palettes for the heat map and oscillator lines.
• Increment: Sets the base lookback length and the step value for each subsequent stochastic line.
• Smooth Fast: Determines the smoothing period applied to the individual stochastics and the average line.
• Smooth Slow: Sets the period for the signal line (Slow line) that follows the average momentum.
• Plot Number: Controls how many stochastic lines (up to 28) are displayed in the heat map stack.
• Paint Bars: When enabled, colors the chart candles based on the aggregate momentum value.
• Waves: Toggles a secondary calculation method for stochastic weighting and increments.

FAQ

How do I interpret the colors on the heat map? Brighter or more saturated colors at the extremes (near the top or bottom of the oscillator pane) indicate overbought or oversold conditions across various timeframes. A transition toward the middle indicates neutral momentum.

What is the difference between the Fast and Slow lines? The Fast line represents the average value of all stochastics currently plotted in the heat map. The Slow line is a smoothed moving average of that Fast line, used to identify trend direction and crossovers.

How can I access this tool? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.