Traders Dynamic Index (TDI) - for NinjaTrader 8
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The Traders Dynamic Index (a.k.a. the TDI indicator) is a trend following momentum indicator based on the RSI. A post discussing different ways of using it, is available in our Spotlight on the Traders Dynamic Index Indicator (with video). A second post on the TDI indicator discussed how to implement a strategy concept using Bloodhound from Shark Indicators..
Indicator Description
The RSI calculation itself applies slightly different settings than the standard RSI version. First, the standard setting use a 13 period average, not the standard RSI 14 period. Secondly, a smoothing period of 2 is used vs. the customary 3 bars applied to the standard RSI. Finally, one may note that the Traders Dynamic Index indicator apply the SMA as the basis for its calculation, not the EMA used for the standard RSI.
Traders Dynamic Index parameters:
The Traders Dynamic Index indicator comes with the following parameters:
The Priceline, which is a SMA(2) of RSI(13)
The Signalline, which is a SMA(7) of RSI (13)
The Midband, which is a SMA(34) of RSI (13)
The BollingerBands around the SMA(34) using 1.62 StdDev
One may consider the below conditions as trade rules:
– go long, if Priceline > 50
– go short if Priceline < 50
– consider an exit, if Priceline is above 68 or below 32
– go long if Priceline > Signal line
– go short if Priceline < Signal line
– exit if Priceline crosses Signal line
– trend filter long, when Priceline > Midband
– trend filter short, when Priceline < Midband
– add to long, when Priceline > BollingerBand.Upper
– add to short, when Priceline < BollingerBand.Lower
The Traders Dynamic Index may be used for a variety of setups, for example with a Daily Regression Channel, Donchian Channel or Heikin Ashi trend bias as described in our Indicator Spotlight. Finally, setups can be confirmed with volume or range analysis, for example using the Force Index and/or the Relative Ranges as described in our Indicator Spotlight newsletter.
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Traders Dynamic Index (TDI) - for NinjaTrader 8
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