Symmetry Reversal Oscillator

The Symmetry Reversal Oscillator indicator measures the position of price within a local swing range to identify potential momentum exhaustion and reversal points.

Usage

The Usage section describes how the script can be used to identify market turns. The oscillator oscillates between -100 and +100, where 0 represents the midpoint of the recent swing range.

• Reversal Signals: A long signal (green triangle) occurs when the oscillator crosses back above the Oversold level after being below it. Conversely, a short signal (red triangle) occurs when the oscillator crosses back below the Overbought level.
• Trend Confirmation: The color of the oscillator line and gradient fill indicates the current bias relative to the zero line. Traders can use the zero-line cross as a secondary confirmation of trend shifts.
• Pullback Identification: In a trending market, the oscillator can help identify the end of a counter-trend correction, allowing for entries in the direction of the primary trend.

Details

The indicator calculates a swing range based on the highest high and lowest low over a user-defined period. The current price's position within this range is normalized to a scale of -100 to +100.

To improve responsiveness and stability, the raw values are processed using an adaptive EMA. The length of this smoothing filter is dynamic, controlled by market volatility measured through ATR:

• High Volatility: The smoothing length decreases, making the oscillator more responsive to fast price movements.
• Low Volatility: The smoothing length increases, filtering out market noise during consolidation.

Settings

Main Settings

• Swing Length: The lookback period used to determine the local high and low boundaries.
• ATR Length: The period used for the Average True Range calculation to estimate volatility.
• Max EMA Length for Adaptive: The maximum smoothing period applied during low volatility.
• Min EMA Length for Adaptive: The minimum smoothing period applied during high volatility.
• Volatility Sensitivity: Adjusts how aggressively the adaptive smoothing reacts to changes in volatility.

OB / OS Levels

• Overbought Level: The upper threshold used to trigger short reversal signals.
• Oversold Level: The lower threshold used to trigger long reversal signals.

Colors

• Bull Color: Sets the color for bullish momentum and signals.
• Bear Color: Sets the color for bearish momentum and signals.
• Dynamic OB/OS Lines: When enabled, the transparency of the levels changes based on the oscillator's proximity to them.

FAQ

How do I interpret the signals?

Signals are generated when the oscillator "returns" from an extreme zone. If the line dips below the oversold level and then crosses back above it, a bullish reversal is suggested.

How do I adjust the indicator for different timeframes?

For lower timeframes or highly volatile assets, you may want to decrease the Swing Length to capture more frequent local swings, or adjust the Volatility Sensitivity to better fit the asset's price action.

How can I access the Symmetry Reversal Oscillator?

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