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LTPI Global Liquidity | JeffreyTimmermans

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Long-Term Probability Indicator (LTPI)

The "Long-Term Probability Indicator (LTPI)" on a generic liquidity ticker is a custom-built analytical tool designed to evaluate market conditions over a long-term horizon, with a strong focus on global liquidity trends. By combining six carefully selected input signals into a single probability score, this indicator helps traders and analysts identify prevailing long-term market states: Bullish, Bearish, or Neutral.

Where short-term systems/timeframes react quickly to price fluctuations, LTPI smooths out noise and focuses on the bigger picture, allowing for informed strategic decision-making rather than short-term speculation.

Key Features

Multi-Input Aggregation:
  • Uses six independent inputs, each based on long-term liquidity and macro-related data, to generate a composite market probability score.

Long-Term Focus:
  • Prioritizes medium-to-long-term trends, ignoring smaller fluctuations that often mislead traders in volatile markets.

Simplified Market States:

Classifies the global market into three primary states:
  • Bullish: Favorable liquidity and conditions for long-term risk-taking.
  • Bearish: Tightening liquidity and conditions that require caution.
  • Neutral: Transitional phases or uncertain conditions.

Background Coloring:
  • Visual cues on the chart help identify which regime is active at a glance.

Global Liquidity Perspective:
  • Designed for use on a generic liquidity ticker, based on M2 money supply, to track macroeconomic liquidity flows and risk appetite.

Dashboard Display:
  • A compact on-screen table summarizes all six inputs, their states, and the resulting LTPI score.

Dynamic Alerts:
  • Real-time alerts signal when the LTPI shifts from one regime to another.


Inputs & Settings

LTPI Inputs:
  • Input Sources (6): Each input is a carefully chosen trend following indicator.
  • Weighting: Each input contributes equally to the final score.

Score Calculation:
  • Bullish = +1
  • Bearish = -1
  • Neutral = 0

Color Settings:
  • Strong Bullish: Bright Green
  • Weak Bullish: Light Green
  • Neutral: Gray/Orange
  • Weak Bearish: Light Red
  • Strong Bearish: Bright Red

(Colors can be customized.)

Calculation Process

Collect Data:
  • Six long-term inputs are evaluated at each bar.

Scoring:
  • Each input’s state contributes +1 (bullish), -1 (bearish), or around 0 (neutral).

Aggregate Probability:
  • The LTPI Score is calculated as the sum of all six scores divided by 6, resulting in a value between -1 and +1.

Market Classification:
  • Score > 0.1: Bullish regime
  • Score < -0.1: Bearish regime
  • -0.1 ≤ Score ≤ 0.1: Neutral

Background Coloring:
  • Background colors are applied to highlight the current regime.


How to Use LTPI

Strategic Positioning:
  • Bullish: Favor holding or adding to long-term positions.
  • Bearish: Reduce risk, protect capital.
  • Neutral: Wait for confirmation before making significant moves.

Confirmation Tool:
  • LTPI works best when combined with shorter-term indicators like MTPI or trend-following tools to confirm alignment across multiple timeframes.

Dynamic Alerts:
  • Bullish Regime Entry: When the LTPI Score crosses above 0.1.
  • Bearish Regime Entry: When the LTPI Score crosses below -0.1.
  • Neutral Zone: When the score moves back between -0.1 and 0.1.

These alerts help identify significant macro-driven shifts in market conditions.

Conclusion

The Long-Term Probability Indicator (LTPI) is an advanced, liquidity-focused tool for identifying macro-driven market phases. By consolidating six inputs into a single probability score and presenting the results visually, LTPI helps long-term investors and analysts stay aligned with global liquidity trends and avoid being distracted by short-term volatility.

Declinazione di responsabilità

Le informazioni ed i contenuti pubblicati non costituiscono in alcun modo una sollecitazione ad investire o ad operare nei mercati finanziari. Non sono inoltre fornite o supportate da TradingView. Maggiori dettagli nelle Condizioni d'uso.