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Miscellaneous > Ergotic_CSI

Article/Author: Origin: http://www.traders2traders.com. Coded by: Ernie Bonugli, Jim Johnson Author: William Blau

Download: Tsi_etc.ela

File Includes:
Indicator - Ergotic_CSI
Function - DTI
Function - DTI_Trade
Function - HMU
Function - LMD
Function - MDI
Function - TSI
Function - TVI
Function - DXAverage
Function - TXAverage
Indicator - *DTI Signal
Indicator - DTI
Indicator - DTI_Trade
Indicator - Ergotic_MACD
Indicator - Ergotic_MDI
Indicator - Ergotic_TSI
Indicator - Ergotic_TSI-2
Indicator - Ergotic_TVI

Category: Indicator > Miscellaneous

Description:

This is one of the techniques described by William Blau in his book "Momentum, Direction and Divergence" (1995). If you like to learn more, we advise you to read this book. His book focuses on three key aspects of trading: momentum, direction and divergence. Blau, who was an electrical engineer before becoming a trader, thoroughly examines the relationship between price and momentum in step-by-step examples. From this grounding, he then looks at the deficiencies in other oscillators and introduces some innovative techniques, including a fresh twist on Stochastics. On directional issues, he analyzes the intricacies of ADX and offers a unique approach to help define trending and non-trending periods.

This indicator plots Ergotic CSI and smoothed Ergotic CSI to filter out noise.

Usage:

The Commodity Selection Index ("CSI") is a momentum indicator. It was developed by Welles Wilder and is presented in his book New Concepts in Technical Trading Systems. The name of the index reflects its primary purpose. That is, to help select commodities suitable for short-term trading.

A high CSI rating indicates that the commodity has strong trending and volatility characteristics. The trending characteristics are brought out by the Directional Movement factor in the calculation--the volatility characteristic by the Average True Range factor.

Wilder's approach is to trade commodities with high CSI values (relative to other commodities). Because these commodities are highly volatile, they have the potential to make the "most money in the shortest period of time." High CSI values imply trending characteristics which make it easier to trade the security.

The Commodity Selection Index is designed for short-term traders who can handle the risks associated with highly volatile markets.




Inputs:

r - specifies the margin requirement (for CSI function calculation)
Zeroline - zeroline

EasyLanguage Code:
{FORMAT: ERGOTIC_CSI(R)

SINGLALINE(R); }

INPUTS: R(32), ZEROLINE(0);

VALUE1 = CSI(R, 5, 1);

VALUE2 = XAVERAGE(CSI(R, 5, 1), 5);

PLOT1(VALUE1, "ERGCSI");

PLOT2(VALUE2, "SIGLIN");

PLOT3(ZEROLINE, "ZERO");