Sector ETF macro trend

11 mar

The Sector ETF Macro Trend indicator is designed for technical analysis of broad economic trends through sector-specific exchange-traded funds (ETFs). It uses logarithmic price transformation, linear regression, and volatility analysis to examine sector trends and stability, providing a technical basis for analytical assessment.

Core Analysis Techniques

• Logarithmic Transformation and Regression: Converts ETF closing prices logarithmically to reveal sector growth patterns and dynamics. Linear regression on these prices defines the main trend direction, essential for trend analysis.
  
• Volatility Bands for Market State Assessment: Applies standard deviation on logarithmic prices to create dynamic bands around the trendline, identifying overbought or oversold sector conditions by marking deviations from the central trend.
  
• Sector-Specific Analysis: Selection among different sector ETFs allows for precise examination of sectors like technology, healthcare, and financials, enabling focused insights into specific market segments.
  

Adaptability and Insight

• Customizable Parameters: Offers flexibility in modifying regression length and smoothing factors to accommodate various analysis strategies and risk preferences.
  
• Trend Direction and Momentum: Evaluates the ETF's trajectory against historical data and volatility bands to determine sector trend strength and direction, aiding in the prediction of market shifts.
  

Strategic Application
Without providing explicit trading signals, the indicator focuses on trend and volatility analysis for a strategic view on sector investments. It supports:

• Identifying macroeconomic trends through ETF performance analysis.
  
• Informing portfolio decisions with insights into sector momentum and stability.
  
• Forecasting market movements by analyzing overbought or oversold conditions against the ETF price movement and volatility bands.
  

The Sector ETF Macro Trend indicator serves as a technical tool for analyzing sector-level market trends, offering detailed insights into the dynamics of economic sectors for thorough market analysis.

17 apr

Note di rilascio

Improved script logic by optimizing number of request.security.
Added normalization, so you can see the price deviation from the average line.

17 apr

Note di rilascio

Updated chart

23 apr

Note di rilascio

Improved bands logic.
Added coloring for overbought/oversold areas.