Description
The Trend-Noise Balance study is a trend-analyzing technical indicator which relates trend to noise in an oscillator format. It is based on calculation of cumulative price change (CPC); this value is reset to zero after each trend reversal indicated by Trend Periods (values switching from -1 to 1 or vice versa).
Values around the +50 level indicate that trend and noise are in equilibrium, while values close to 100 can signify strong trending conditions, and values close to 0 suggest that the trend is weak.
Input Parameters
| Parameter | Description |
|---|---|
fast length
|
The number of bars used in calculation of fast EMA of Trending Periods. |
slow length
|
The number of bars used in calculation of slow EMA of Trending Periods. |
trend length
|
The number of bars upon which the trend is defined. |
noise type
|
Defines mechanism of defining noise: linear or root mean square. |
noise length
|
The number of bars upon which noise is determined. |
correction factor
|
Multiplier used in noise calculation. |
Plots
| Plot | Description |
|---|---|
TNB
|
The Trend-Noise Balance plot. |
HalfLine
|
The +50 level. |
Further Reading
1. "Trend-Quality Indicator" by David Sepiashvili. Technical Analysis of Stocks & Commodities, April 2004.
Example*
*For illustrative purposes only. Not a recommendation of a specific security or investment strategy.