SuperTrend With EMA100

The SuperTrend With EMA100 indicator is a trend-following tool designed to identify potential reaction points and trend reversals by combining Exponential Moving Average (EMA) filtering with Average True Range (ATR) volatility bands.

Usage

The SuperTrend With EMA100 can be used to identify the prevailing market trend and pinpoint entry or exit levels based on volatility-adjusted support and resistance.

• Trend Identification: When the price is above the SuperTrend line (colored green), the market is considered to be in an uptrend. Conversely, when the price is below the line (colored red), a downtrend is indicated.
• Reaction Points: Using a 100-period EMA as the basis for the SuperTrend calculation allows users to find "best reaction points" for pullbacks during established trends.
• Signals: The script plots circles to signify the beginning of a new trend direction. These can be used as confirmation for trend-following strategies.

Details

This script adapts the classic SuperTrend calculation, originally developed by KivancOzbilgic, by utilizing an EMA as the source for the median line rather than traditional price action.

The distance between the EMA and the SuperTrend lines is determined by the ATR multiplied by a user-defined factor. This implementation offers two methods for ATR calculation: the standard ta.atr() function or a simple moving average of the true range. By anchoring the volatility bands to a long-term EMA (default 100), the indicator aims to filter out minor price fluctuations and focus on more significant trend shifts.

Settings

Main Settings

• ATR Period: Sets the lookback period for the Average True Range calculation used to determine volatility.
• EMA Length: Defines the length of the Exponential Moving Average that serves as the basis for the indicator.
• ATR Multiplier: Determines the distance between the EMA and the SuperTrend lines. A higher multiplier makes the indicator less sensitive to price changes.
• Change ATR Calculation Method?: Toggles between using the built-in ATR function or an SMA-based true range calculation.
• Highlighter On/Off?: Enables or disables the background color filling between the price and the trend lines.

FAQ

How do I use the signals from this indicator?

The indicator provides visual cues for trend changes through color shifts and plot shapes. Many traders use the green zones to look for long opportunities and red zones for short opportunities, often in alignment with higher timeframe analysis.

What is the advantage of using an EMA100 basis?

Using a 100-period EMA helps smooth out the SuperTrend line, making it less prone to whipsaws in sideways markets and providing a clearer view of the long-term trend direction.

How can I access this script?

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