Modjoy-Triangular Hull Moving Average + Volatility [BigBeluga]

Modjoy-Triangular Hull Moving Average + Volatility [BigBeluga]: A Comprehensive Trading Strategy

In the realm of technical analysis, traders are constantly seeking innovative indicators to refine their trading strategies and gain a competitive edge. One such indicator is the Modjoy-Triangular Hull Moving Average + Volatility, commonly referred to as BigBeluga. This article delves into the core logic and trading strategy behind BigBeluga, providing an in-depth understanding of its application in the financial markets.

Introduction to BigBeluga

BigBeluga is a hybrid indicator that combines the strengths of the Triangular Hull Moving Average (THMA) and volatility measurements. The THMA is a type of moving average that uses a triangular weighted average to calculate the price, providing a smoother and more reactive indicator. By incorporating volatility into the THMA, BigBeluga offers a more comprehensive view of market conditions, enabling traders to make informed decisions.

Core Logic of BigBeluga

The core logic of BigBeluga revolves around the following key components:

• Triangular Hull Moving Average (THMA): The THMA is calculated using a triangular weighted average of the price, which helps to reduce noise and provide a clearer view of the trend.
• Volatility Measurement: Volatility is measured using the Average True Range (ATR), which takes into account the range of price movements over a specified period.
• Modjoy Algorithm: The Modjoy algorithm is a proprietary formula that combines the THMA and volatility measurements to generate a unique signal.

Trading Strategy with BigBeluga

The BigBeluga indicator can be used as a standalone trading strategy or in conjunction with other indicators to form a hybrid approach. Here are some key strategies to consider:

Long Entry

A long entry is triggered when the BigBeluga line crosses above the zero line, indicating a bullish trend. Additionally, the following conditions should be met:

• The THMA should be rising.
• Volatility should be increasing, as measured by the ATR.
• The price should be above the THMA.

Short Entry

A short entry is triggered when the BigBeluga line crosses below the zero line, indicating a bearish trend. The following conditions should also be met:

• The THMA should be falling.
• Volatility should be increasing, as measured by the ATR.
• The price should be below the THMA.

Stop-Loss and Take-Profit

A stop-loss can be placed below the recent low for long entries or above the recent high for short entries. The take-profit target can be set based on the volatility measurement, such as 1-2 ATRs from the entry point.

Conclusion

In conclusion, the Modjoy-Triangular Hull Moving Average + Volatility [BigBeluga] is a robust trading indicator that offers a unique perspective on market conditions. By combining the strengths of the THMA and volatility measurements, BigBeluga provides a comprehensive view of the trend and volatility, enabling traders to make informed decisions. As with any trading strategy, it is essential to backtest and refine the BigBeluga indicator to suit individual trading styles and risk tolerance.

Recommendations

Traders looking to incorporate BigBeluga into their trading strategy should consider the following recommendations:

• Backtesting: Perform thorough backtesting to validate the effectiveness of the BigBeluga indicator in various market conditions.
• Risk Management: Implement proper risk management techniques, such as position sizing and stop-loss placement, to minimize potential losses.
• Combination with Other Indicators: Consider combining BigBeluga with other indicators to form a hybrid approach, such as incorporating trend following or momentum indicators.

By following these recommendations and understanding the core logic and trading strategy behind BigBeluga, traders can unlock the full potential of this powerful indicator and enhance their trading performance.

Modjoy Exclusive Source Code:

// This work is licensed under Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International  


//@version=6
indicator("Modjoy-Triangular Hull Moving Average + Volatility [BigBeluga]", "THMA + Volatility [BigBeluga]", overlay = true)

// ＩＮＰＵＴＳ ――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――{
int  len_  = input.int(40, "Length")
float source = input.source(close, "Source")
bool volat = input.bool(true, "Volatility", inline = "vola"), len_vol = input.int(15, "", inline = "vola")
color_u = input.color(#16e5a0, "", inline = "colors")
color_d = input.color(#741ddd, "", inline = "colors")
// }


// ＣＡＬＣＵＬＡＴＩＯＮＳ――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――{
float volatility = ta.hma(high-low, len_vol)
var string trend = ""

vv = ta.percentile_nearest_rank(volatility, 1000, 100)
vol = volatility / vv

// THMA
thma(_src, _length) =>  
    ta.wma(ta.wma(_src,_length / 3) * 3 - ta.wma(_src, _length / 2) - ta.wma(_src, _length), _length)
    
float thma  = thma(source, len_)
float thma1 = thma[2]

bool signal_up = ta.crossover(thma, thma1)
bool signal_dn = ta.crossunder(thma, thma1)


switch
    signal_up => trend := "🢁"
    signal_dn => trend := "🢃"

// colors
color  = thma > thma1 ? color_u : color_d
color1 = color
// }

atr = ta.atr(200)
// ＰＬＯＴ ――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――――{
// Hull Plot
plotcandle(thma, thma  + volatility, thma1 - volatility, thma1, "", color.new(color1, volat ? 40 : 0), color.new(color1, volat ? 40 : 100), bordercolor = color.new(color1,0))

// Signals
plotshape(signal_up ? thma1 - atr : na, "Up", shape.triangleup, location.absolute, color = color.new(color, 60), size = size.small, force_overlay = true)
plotshape(signal_up ? thma1 - atr : na, "Up", shape.triangleup, location.absolute, color = color.new(color, 0 ), size = size.tiny, force_overlay = true)

plotshape(signal_dn ? thma1 + atr : na, "Dn", shape.triangledown, location.absolute, color = color.new(color, 60), size = size.small, force_overlay = true)
plotshape(signal_dn ? thma1 + atr : na, "Dn", shape.triangledown, location.absolute, color = color.new(color, 0 ), size = size.tiny, force_overlay = true)

if barstate.islast
    dash = table.new(position.bottom_right, 10, 10, bgcolor = color.new(chart.fg_color, 90), border_color = chart.bg_color, border_width = 5)
    dash.cell(0, 0, "Trend: "+ trend, text_color = trend == "🢃" ? color_d : color_u)
    dash.cell(0, 1, "Volatility: "+ str.tostring(vol*100, format.percent), text_color = chart.fg_color)

// }