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TOPIC: Swordfish VIX indicator

Swordfish VIX indicator 2 years, 6 months ago #1

  • Shane
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1. I am providing some explanation for the VIX indicator I use on sf.
2. The calculation is based on standard deviations.
3. It should not be used as a standalone indicator.
4. It compliments bollinger bands.
5. It does not give trade DIRECTION!

Note:
1. When VIX is below 13, a breakout is likely to occour; Direction unknown.
2. When VIX is above 20, then the breakout occoured and a larger swing/move is in progress.
3. When VIX is above 40, then the swing/move is reaching maturity.

The VIX gives the trader in indication when it is a good time open and close/add a position.
for example, never add a position when VIX is 60.
for example, get ready to open trade when VIX is below 13.

I have inserted three snapshots with vertical lines indicating when vix was below 13. One can see the subsequent breakout occur. Notice how the bollinger bands remain expanded but the vix indicates a possible entry.

One can easily compliment any trading system by just knowing what the VIX is.

I do not have any particular reading on this indicator but will update this post with my trade findings.

Hope this is helpful. All the best,
Shane


VIX11th.png


VIX12th.png


VIX13th.png
Last Edit: 2 years, 6 months ago by Shane. Reason: lines are vertical not horizontal.
The following user(s) said Thank You: greengrass

Re: Indicator: VIX 2 years, 6 months ago #2

  • Shane
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Here is the sf code for the vix:

L:=STD(Close,100);
S:=STD(CLOSE,6);

VIX:S/L*100, COLORStick;
VLEVEL:13,StyleDash,Horizontal,Width1;
The following user(s) said Thank You: t2twell

Re: Indicator: VIX 2 years, 6 months ago #3

  • t2twell
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tks for the code..how do u highlight the inside range between the bollingers?

Re: Indicator: VIX 2 years, 6 months ago #4

  • CPS
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Tnx Shane,

T2twell the highlighted BB i believe is being used as a areabb indicator

Re: Indicator: VIX 2 years, 6 months ago #5

  • Shane
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To get BB area shaded, add the following indicator under:

Extended/AreaBB

Re: Indicator: VIX 2 years, 6 months ago #6

  • Shane
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A low VIX should give a trader confidence to enter a trade at a predetermined level.

Note that direction is not indicated by the VIX.

VIX16th.png



Regards

Re: Indicator: VIX 2 years, 6 months ago #7

  • Shane
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I desiged a VIX trigger strategy code which will plot on the chart when VIX goes below 13.
Vix below 13 triggers a possible entry point.
i.e wait for a VIX trigger, and trade the breakout of a prior high or prior low.

Will attempt to enhance the code as my programming skills improve....Regards

VIX Strateget Code:

L:=STD(Close,100);
S:=STD(CLOSE,6);
VIX:=S/L*100;
VIX1:= 100 * (S / L);
VIXS :=CROSS(13,VIX1);
DRAWTEXT(VIXS==1,LOW-25,'Vi<13',1),Label0,VCenter,Bottom,ColorBlue,Font4;



VIX16th2.png
The following user(s) said Thank You: wedret1

Re: Indicator: VIX 2 years, 6 months ago #8

  • JacoGreeff
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Hi Shane

Thanx a million for sharing this code, in the process we all grow as traders and so does our systems.

I use a volatility breakout system and the vix goes brilliantly with it.

Re: Indicator: VIX 2 years, 3 months ago #9

  • van Deventer
Where do I get the VIX indicator on Sf?

Re: Indicator: VIX 2 years, 3 months ago #10

  • greengrass
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Hi Van Devender

The code is two posts up, post 7. You use that code to create your own custom indicator in Swordfish. Here is a video that will show you how to do that step by step.
www.realchartist.com/resources/swordfish...or-to-swordfish.html
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