Power Root SuperTrend

The Power Root SuperTrend indicator provides an advanced trend-following framework that utilizes Root-Mean-Square (RMS) calculations to offer a more responsive and adaptive alternative to the traditional SuperTrend.

Usage

The tool is designed to identify prevailing market trends and provide automated price targets for exiting positions. Traders can use the color-coded bands to determine the current market bias: a green band indicates a bullish environment, while a red band indicates a bearish environment.

When a trend shift occurs, the script automatically generates horizontal lines representing up to seven take-profit (TP) levels. These levels are derived from the volatility of the SuperTrend's transition, offering a systematic way to scale out of trades. Furthermore, the "X" marks on the chart represent RSI-based take-profit signals, which trigger when the momentum of the price distance from the SuperTrend line shows signs of exhaustion.

Details

The Power Root SuperTrend improves upon the standard ATR-based trailing stop by first applying a Root-Mean-Square (RMS) function to the closing prices. This preprocessing step results in a smoother yet more sensitive input for the SuperTrend calculation, allowing the indicator to react more swiftly to genuine price reversals while filtering out minor noise.

The take-profit levels (TP1-TP7) are calculated based on the absolute change in the SuperTrend value at the moment of a trend flip. This change serves as a volatility unit, which is then projected forward to create incremental targets. Additionally, the tool calculates the Relative Strength Index (RSI) of the distance between price and the SuperTrend line; a crossunder of this RSI below a threshold (60) suggests that the current extension is losing steam, providing a secondary signal for trade management.

Settings

• Factor: The multiplier used for the ATR calculation to determine the distance of the SuperTrend bands.
• ATR Length: The lookback period used for the Average True Range volatility calculation.
• Root-Mean-Square Length: The lookback period for the RMS smoothing applied to the source price.
• RSI Take-Profit Length: The period used for the RSI calculation of the price-to-SuperTrend distance.
• Bullish/Bearish Color: Customizable colors for the trend bands and take-profit levels.

FAQ

How do I access Power Root SuperTrend?

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

What do the "X" characters on the chart represent?

These are RSI-based take-profit signals. They appear when the momentum of the price's distance from the SuperTrend line indicates a potential local exhaustion point.

How are the take-profit levels determined?

The levels are calculated based on the magnitude of the SuperTrend's value shift when a trend reversal occurs, creating seven equidistant targets based on that specific volatility event.