The Cycle-Swing-Indicator "CSI" provides an optimized "momentum" oscillator based on the current dominant cycle by looking at the swing of the dominant cycle instead of the raw source momentum. Offering the following improvements:
Smoothness
Zero delay
Sharpness at turning points
Robust and adaptable to market conditions
Accurate deviation detection
The following common problems with standard indicators are solved by this indicator:
First, normal indicators introduce a lot of false signals due to their noisy signal line. Second, to compensate for the noise, one would normally try to add some smoothing. But this only results in adding more delay to the indicator, which makes it almost useless. Third, standard indicators require a length adjustment to derive reliable signals. However, you never know how to set the right length.
All three problems described above are solved by the developed adaptive cyclic algorithm.
The above chart shows current Bitcoin 4h data from the last days as of writing with the proposed signal reading for this indicator. The standard momentum indicator is included for comparison.
HOW TO USE The indicator works without any parameter and can be applied to any chart and any time-frame. It will adapt automatically to the Dominant Cycle and use the dominant cycle of the source data to derive the ultra smooth momentum curve. Adaptive upper/lower bands are included and highlight areas with extreme readings. Automatic divergence detection can be turned off/on.
HOW TO READ The indicator can be used like any oscillator. In addition, it provides adaptive high and low bands. * Look for turns above the upper/lower bands * Look for divergences between source and signals line
Further reading/Original source: The indicator uses the dominant cycle to optimize signal, smoothing and cyclic memory. To get more in-depth information on the Cycle Swing Indicator, please read Chapter 10 "Cycle Swing Indicator: Trading the swing of the dominant cycle" of the book "Decoding the Hidden Market Rhythm, Part 1" available at your favorite book store.
Related ideas: Please also check the cyclic RSI indicator which also uses cyclic information to improve the signal.
Thank you very much for sharing this very useful indicator.
UnknownUnicorn11161970
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It seems the divergences signals appear only after the price moved by a few bars?
Does it repaint?
Naif824
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Awesome, it just doesnt show the indicators for Bullish/Hidden Bulish/Bearish and Hidden Bearish as done in the example chart.
persson007
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i dont see any arrows on my charts ,how i get them?
angel9412
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@persson007, did you end up fixing the issue ? i dont have arrows on my chart either
starbolt
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Are divergences shown right at the bar or immediately after the bar who has the criteria for the divergence? I mean, can you trade divergences right as they appear or they are only shown after a few bars... I tried with many stocks but couldn't see one showing a divergence for the last bar on screen.
stevenwalter0
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Wow what an incredible indicator. A real piece of art. Thank you for sharing it. I couldn't agree more with your words in the description. So many indicators just follow price exactly and end up giving you a ton of false signals for suckers who love losing money from whiplash. Cycles really are a secret sauce to a great indicator from what I can see, it's really nice to see someone explaining that so well. Given the new dynamic length variables and array function in Pinescript i'm excited to see all the opportunity for powerful indicators such as this.
PS: This reminds me a little of Ehlers Truncated Bandpass Filter (the correct version, not the one you mostly find).
Great job here mate (from a surface view that is). About to test it out now. I believe in your cRSI script a length input was needed for the Dom Cycle to calculate on. Why not here?