The Power Trader(Balance of Power)- Trading View Indicator
The Power Trader(Balance of Power)- Trading View Indicator
The Power Trader is an indicator based around the Balance of Power Oscillator. Balance of Power is a price-based measurement that evaluates and compares the strength of buyers and sellers by assessing their respective abilities to push prices to extreme points(both extreme highs and extreme lows).
BoP values fluctuate between a maximum value of 100 and a minimum value of -100. When the BoP value is greater than 0, it indicates that buying pressure is greater than selling pressure. Conversely, negative BoP readings mean that selling pressure is greater than buying pressure.
Why Those Indicators? -
This indicator is among our favorites, not only for its reliable signals but also its ability to visually represent the relative power of buyers and sellers in any current market.
The exponential moving average of Balance of Power values is displayed as a gray line on the chart. The upper red line represents the upper bound at which a security is considered overbought. The lower green line represents the threshold where we start to consider a security to be in an oversold state.
When the gray BoP EMA line crosses below the lower green line, it changes color to green then changes back to gray once it crosses back above that lower threshold. Similarly, the line turns red when it crosses above the upper red line.
When the EMA line is between the upper and lower bounds, it signifies that there is no significant difference between the power of buyers versus the power of sellers. The top red area indicates that the amount of buying pressure is relatively high. The lower green area means that selling pressure is abnormally high.
What is it Used For? -
Can be used on any interval to determine if the bulls are in command of the market or bears.
How To Use It -
When the BoP line falls between the red and green areas, do not take action. When the BoP line turns green and is inside the green area, enter a long position. When the BoP line rises above the red line and into the upper red area, exit the long position.
Entry signals are displayed as vertical green lines that extend the length of the chart. Exit signals are represented by the same lines, except in red.
Users can decide the order of signals in the input option menu through the ‘allow repeat signals’ parameter. If this is set to false, the study will generate signals in the logical chronologic order of [buy, sell, buy, sell, buy, sell,….]. If it is set to true, then signals will be generated as they come, regardless of whether the last signal was its inverse. This means that it could generate sequences like this for example [buy, buy, sell, buy, sell, sell, sell,…].
Here 'Allow Repeat Signals?' is set to false.
'Allow Repeat Signals' when set to true.
Additionally, the stop and limit can also be set in the input menu through the ‘stop’ and ‘limit’ options. This input option accepts parameters of type float (ie: numbers that contain decimals).
The 'Upper Bound for BoP Values' and 'Lower Bound for BoP Values' input options gives traders the option to adjust the upper and lower thresholds for buy and sell signals. It is important to note that setting the upper bound higher or the lower bound lower will result in less frequent signals (and vice versa).
Here, 'Upper Bound for BoP Values' is set very high(40).
When it is time to enter a long position, an alert with the following message is sent “Power Trader - High Sell Pressure, Enter Long”.
When it is time to exit a long position, an alert with the following message is sent “Power Trader - High Buy Pressure, Exit Long”.
When users purchase Profit Programmers scripts, they gain access to both the strategy and study versions. The purpose of the strategy is to help traders finetune the many input options and run backtests with these different settings to discover the optimal settings for achieving the best results for their specific intended purpose. Unfortunately, TradingView does not allow you to create alerts using a strategy script, so the best way to work around this is to spend time tweaking the various settings in the strategy script, compare the results and then implement those settings into your study through the study script’s input menu. This way, your alerts will still be delivered and you can be confident that those alerts are being generated based on the settings that you achieved the best backtesting results with. This is useful for both high frequency day traders and those implementing automated trading systems (‘bots’) which rely on alert messages to stay up to date; or execute trades automatically in the case of trading bots.
All strategies include input options which allow users to execute backtests with specific stop and limit percentages. These prices are then plotted on top of the price chart, with the red area symbolizing the stop loss and green area representing the limit.If users do not wish to use a limit or a stop, they can set those input values equal to 0.0 and the strategy will ignore those parameters when running its backtest.
Lastly, traders can adjust the date range on which the backtest is performed. This is great for gaining insight on how the indicator responds during various market conditions(ie: How should I tweak the settings when the market is in a long term bear/bull run? How did it respond during the sharp price increase in x month of y year?).
When the strategy enters a long position, a vertical green line is plotted. While in that position, the limit and stop levels are plotted on the graph in green (limit) and red (stop). If you do not want to utilize a stop loss or limit you can set the corresponding ‘limit’ and ‘stop’ input options to 0.0 in the input menu.
The Power Trader strategy version gives traders a full suite to backtest their indicator and identify the best possible settings for all market conditions.
Some Backtesting Results-
How to Install-
Enter your TradingView user name into the forum on the product page when you purchase the indicator.
Within 24 hours our team will validate the username and purchase, which will let them send you our invite only scripts
Your indicator will be shown in the "invite only scripts" category under your "Indicator" panel in Trading View
*We have no affiliation with TradingView.com, we purely sell studies and strategies based off the proprietary pine script language used on Trading View