This strategy, named “OBVious MA Strategy: Trend Following Strategy Based on OBV and MA Crossover Signals”, utilizes the crossover between the On Balance Volume (OBV) indicator and moving averages to generate trading signals. OBV can provide leading trend signals, and this strategy uses OBV breakouts above or below moving averages as entry and exit conditions to capture trends. By using separate entry and exit MAs, it allows for more flexible control over holding periods. Although this strategy is a simple demonstration, it showcases how to effectively use OBV for volume analysis.
This strategy demonstrates a simple trend-following method based on OBV and MA crossovers. Its advantages are clear logic, timely trend capture, and flexible holding control through separate entry and exit MAs. However, its disadvantages include a lack of risk control measures and signal confirmation methods. Improvements can be made in areas such as trend filtering, parameter optimization, position management, and joint signals to obtain more robust strategy performance. This strategy is more suitable as a guiding signal to be used in conjunction with other strategies.
/*backtest start: 2023-04-23 00:00:00 end: 2024-04-28 00:00:00 period: 1d basePeriod: 1h exchanges: [{"eid":"Futures_Binance","currency":"BTC_USDT"}] */ // This Pine Script™ code is subject to the terms of the Mozilla Public License 2.0 at https://mozilla.org/MPL/2.0/ // © ThousandX_Trader //@version=5 strategy(title="OBVious MA Strategy [1000X]", overlay=false, initial_capital=10000, margin_long=0.1, margin_short=0.1, default_qty_type=strategy.percent_of_equity, default_qty_value=100, slippage=1, commission_type=strategy.commission.percent, commission_value=0.1) // Direction Input /// tradeDirection = input.string("long", title="Direction", options=["long", "short"], group = "Direction Filter") /////////////////////////////////////// // 1000X OBV MA INDICATOR // /////////////////////////////////////// // OBV Trend Length Inputs // long_entry_length = input(190, title="Long Entry MA Length", group = "Moving Average Settings") long_exit_length = input(202, title="Long Exit MA Length", group = "Moving Average Settings") short_entry_length = input(395, title="Short MA Entry Length", group = "Moving Average Settings") short_exit_length = input(300, title="Short Exit MA Length", group = "Moving Average Settings") // OBV Calculation obv = ta.cum(ta.change(close) >= 0 ? volume : -volume) // Calculate OBV Moving Averages obv_ma_long_entry = ta.sma(obv, long_entry_length) obv_ma_long_exit = ta.sma(obv, long_exit_length) obv_ma_short_entry = ta.sma(obv, short_entry_length) obv_ma_short_exit = ta.sma(obv, short_exit_length) /////////////////////////////////////// // STRATEGY RULES // /////////////////////////////////////// longCondition = ta.crossover(obv, obv_ma_long_entry) and tradeDirection != "short" and strategy.position_size <= 0 longExitCondition = ta.crossunder(obv, obv_ma_long_exit) shortCondition = ta.crossunder(obv, obv_ma_short_entry) and tradeDirection != "long" and strategy.position_size >= 0 shortExitCondition = ta.crossover(obv, obv_ma_short_exit) /////////////////////////////////////// // ORDER EXECUTION // /////////////////////////////////////// // Close opposite trades before entering new ones if (longCondition and strategy.position_size < 0) strategy.close("Short Entry") if (shortCondition and strategy.position_size > 0) strategy.close("Long Entry") // Enter new trades if (longCondition) strategy.entry("Long Entry", strategy.long) if (shortCondition) strategy.entry("Short Entry", strategy.short) // Exit conditions if (longExitCondition) strategy.close("Long Entry") if (shortExitCondition) strategy.close("Short Entry") /////////////////////////////////////// // PLOTTING // /////////////////////////////////////// // Plot OBV line with specified color plot(obv, title="OBV", color=color.new(#2962FF, 0), linewidth=1) // Conditionally plot Long MAs with specified colors based on Direction Filter plot(tradeDirection == "long" ? obv_ma_long_entry : na, title="Long Entry MA", color=color.new(color.rgb(2, 130, 228), 0), linewidth=1) plot(tradeDirection == "long" ? obv_ma_long_exit : na, title="Long Exit MA", color=color.new(color.rgb(106, 168, 209), 0), linewidth=1) // Conditionally plot Short MAs with specified colors based on Direction Filter plot(tradeDirection == "short" ? obv_ma_short_entry : na, title="Short Entry MA", color=color.new(color.rgb(163, 2, 227), 0), linewidth=1) plot(tradeDirection == "short" ? obv_ma_short_exit : na, title="Short Exit MA", color=color.new(color.rgb(192, 119, 205), 0), linewidth=1)