Using Dow Theory indicator as a filter in automated strategies

December 16th, 2010, 08:53 AM

I have been trialling the Dow Theory indicator in some of my automated strategies and find that it could be a useful additional filter for entries and more importantly, for early exits.

However as always my programming skills let me down to see how I can use this as a filter in a strategy code.

If anyone can suggest a snippet I would appreciate their assistance.

Cheers,
Nano

December 16th, 2010, 09:06 AM

There are no exposed outputs the way it is currently writtern. So, you can't call this indicator from a strategy. However, it can be modified to allow outputs if I know what you want to use in a strategy. Also, if you want, contact me privately and we can work on it offline.

December 16th, 2010, 11:21 AM

I made a modification to the DowTheory indicator that plots the high/low lines as continuous so you can see what they were in the past.

Also, I am thinking you want this indicator to report bullish, bearish, or chop so you can test for the current condition in your strategy. So, I modified the code so you can do just that. I am attaching it here so you can review it before I post it in the downloads section.

Insert the following code in your strategy to test for the different market conditions.

Code

 
if (DowTheory_v1(10).Direction[0] == 1)  // test for a bullish condition
{
     // do something related to a bullish market
}
 
if (DowTheory_v1(10).Direction[0] == -1)  // test for a bearish condition
{
     // do something related to a bearish market
}
 
if (DowTheory_v1(10).Direction[0] == 0)  // test for a choppy condition
{
     // do something related to a choppy market
}

December 17th, 2010, 03:15 AM

MWinfrey

I made a modification to the DowTheory indicator that plots the high/low lines as continuous so you can see what they were in the past.

Also, I am thinking you want this indicator to report bullish, bearish, or chop so you can test for the current condition in your strategy. So, I modified the code so you can do just that. I am attaching it here so you can review it before I post it in the downloads section.

Insert the following code in your strategy to test for the different market conditions.

Code

 
if (DowTheory_v1(10).Direction[0] == 1)  // test for a bullish condition
{
     // do something related to a bullish market
}
 
if (DowTheory_v1(10).Direction[0] == -1)  // test for a bearish condition
{
     // do something related to a bearish market
}
 
if (DowTheory_v1(10).Direction[0] == 0)  // test for a choppy condition
{
     // do something related to a choppy market
}

Thanks Mike, I'll check it out.

Cheers,
Nano

December 21st, 2010, 04:54 AM

MWinfrey

I made a modification to the DowTheory indicator that plots the high/low lines as continuous so you can see what they were in the past.

Also, I am thinking you want this indicator to report bullish, bearish, or chop so you can test for the current condition in your strategy. So, I modified the code so you can do just that. I am attaching it here so you can review it before I post it in the downloads section.

Insert the following code in your strategy to test for the different market conditions.

Code

 
if (DowTheory_v1(10).Direction[0] == 1)  // test for a bullish condition
{
     // do something related to a bullish market
}
 
if (DowTheory_v1(10).Direction[0] == -1)  // test for a bearish condition
{
     // do something related to a bearish market
}
 
if (DowTheory_v1(10).Direction[0] == 0)  // test for a choppy condition
{
     // do something related to a choppy market
}

Your version of the Dow Theory indicator looks great Mike. I think you should post it in the downloads section.

Cheers,
Nano

July 24th, 2012, 07:36 AM

MWinfrey

I made a modification to the DowTheory indicator that plots the high/low lines as continuous so you can see what they were in the past.

Also, I am thinking you want this indicator to report bullish, bearish, or chop so you can test for the current condition in your strategy. So, I modified the code so you can do just that. I am attaching it here so you can review it before I post it in the downloads section.

Insert the following code in your strategy to test for the different market conditions.

Code

 
if (DowTheory_v1(10).Direction[0] == 1)  // test for a bullish condition
{
     // do something related to a bullish market
}
 
if (DowTheory_v1(10).Direction[0] == -1)  // test for a bearish condition
{
     // do something related to a bearish market
}
 
if (DowTheory_v1(10).Direction[0] == 0)  // test for a choppy condition
{
     // do something related to a choppy market
}

I haven't looked at the indicator yet, but it is great to have guys like you on this forum.

I am slowly learning to program, and I can say the only reason I have been successful in doing so is because of examples of code from yourself and others.

Keep up the good work.

November 14th, 2014, 02:07 AM

Hello,

Could anyone please tell what the Period of 10 represents in this indicator?

March 28th, 2015, 06:56 PM

Updated the indicator with line colors so it would be possible to see what the trend was in the past. I also gave the trend text better visibility in the top right hand corner.

FYI - I dabble in coding so there may be a more efficient way to write the code than I did. Feel free to update.

Robert

Using Dow Theory indicator as a filter in automated strategies

Discussion in NinjaTrader

Using Dow Theory indicator as a filter in automated strategies