OPEN-SOURCE SCRIPT
Hurst Exponent Smoothed
Description:
The Hurst Exponent Smoothed indicator provides a dynamic analysis of market behavior by calculating the Hurst Exponent over a specified lookback period. This tool is especially useful for identifying whether a market is trending or mean-reverting.
Key Features:
Lookback Period: Set to 90 by default, this parameter controls how many periods the indicator considers for its calculations. Adjusting this value allows you to fine-tune the sensitivity of the indicator to recent price action.
Market Analysis: The Hurst Exponent gives insights into the nature of price movement:
A value near 0.5 suggests a random walk, indicating that the market is unpredictable.
Values above 0.5 indicate a trending market where price movements exhibit persistence, suggesting that the current trend may continue.
Values below 0.5 point to a mean-reverting market, where price movements tend to reverse, making it a potential signal for contrarian trading strategies.
Usage:
Trend Following: When the Hurst Exponent is consistently above 0.5, it may indicate a strong trend. Traders can use this information to align with the current market direction.
Mean Reversion: If the Hurst Exponent falls below 0.5, it could signal that the market is more likely to revert to the mean, offering opportunities for mean-reversion strategies.
Visuals:
The indicator displays a smooth line oscillating between values, giving traders a clear visual cue for the current market condition.
The script is optimized for various timeframes, as demonstrated on the BTCUSD pair on a 270-minute chart. Traders can adapt the lookback period based on their trading style and the specific asset being analyzed.
Open Source: This script is open-source and free to use. Feel free to customize and adapt it to your needs!
The Hurst Exponent Smoothed indicator provides a dynamic analysis of market behavior by calculating the Hurst Exponent over a specified lookback period. This tool is especially useful for identifying whether a market is trending or mean-reverting.
Key Features:
Lookback Period: Set to 90 by default, this parameter controls how many periods the indicator considers for its calculations. Adjusting this value allows you to fine-tune the sensitivity of the indicator to recent price action.
Market Analysis: The Hurst Exponent gives insights into the nature of price movement:
A value near 0.5 suggests a random walk, indicating that the market is unpredictable.
Values above 0.5 indicate a trending market where price movements exhibit persistence, suggesting that the current trend may continue.
Values below 0.5 point to a mean-reverting market, where price movements tend to reverse, making it a potential signal for contrarian trading strategies.
Usage:
Trend Following: When the Hurst Exponent is consistently above 0.5, it may indicate a strong trend. Traders can use this information to align with the current market direction.
Mean Reversion: If the Hurst Exponent falls below 0.5, it could signal that the market is more likely to revert to the mean, offering opportunities for mean-reversion strategies.
Visuals:
The indicator displays a smooth line oscillating between values, giving traders a clear visual cue for the current market condition.
The script is optimized for various timeframes, as demonstrated on the BTCUSD pair on a 270-minute chart. Traders can adapt the lookback period based on their trading style and the specific asset being analyzed.
Open Source: This script is open-source and free to use. Feel free to customize and adapt it to your needs!
Forever learning!
Skrypt open-source
In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in publications is governed by House rules. Możesz go oznaczyć jako ulubione, aby użyć go na wykresie.
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Forever learning!
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