At the start of each trading day (0930 EST), this indicator calculates the intraday price difference between open and close for the eight largest market cap stocks (AAPL, AMZN, GOOGLE, META, MSFT, NFLX, NVDA, and TSLA), assigns a +/-1 for each, and then plots the cumulative change. An EMA has been added for smoothing purposes that is set to 5 but can be changed. Please note indicator is best used on lower timeframes (15 min or less) and has no applicability to time frames above 1 hour.
The thought behind this indicator is those eight major stocks drive a majority of intraday price change in indices like SPY and QQQ that are heavily weighted towards these stocks, therefore they should be a leading indicator in price change. You can often catch a move in SPY or QQQ one to two bars (on 1 min chart) ahead of the actual move because you see this indicator moving strong to one direction.
It's not perfect as there are divergences you will see when you compare historical charts, but oftentimes those divergences ultimately lead to significant price swings in the same direction as this indicator, so recommend being on watch to pull the trigger when you see those and price confirms.
You can use this indicator in a few ways: 1. Confirmation that your current trade is in the same direction as this indicator 2. Use the zero cross as a trigger for put or call entry 3. Focusing only on calls/longs if the value is above 0, or only puts/shorts if the value is below zero. Just be sure to keep an eye on reversals.
If you have recommendations on how to improve, let me know and I'll do my best to make changes.
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Chart photo update only.
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Updated time from UTC-5 to UTC-4 given daylight savings time. Will figure out a more permanent update for that at a later date. Also trying to figure out how to make this only perform during NY market hours (0930-1600 EST) that way it shows more accurately on "futures" tickers - right now the indicator skews odd when viewing those tickers. Will eventually publish update to correct both.
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Code updated to only plot during New York market hours and reset to zero after, making the indicator much cleaner, especially on the EMA to start the day.
Also modified the default line styles for both the indicator and the smoothing EMA. Each are now colored differently to differentiate, making it easier to spot "crossovers" in momentum/breadth from the indicator line to it's average. If you prefer, you can switch the lines to a histogram or even area, and you also have the option to remove the EMA if you don't want it smoothed.
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Adjusted reset time to fix issue when viewing "regular market" hours vs. "extended" or "electronic" hours. If utilizing the EMA with this indicator (it is useful for tracking momentum duration or change), recommend turning on extended hours trading. If you are not using the EMA, then it doesn't matter which setting you use.
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Upon further consideration, removed NFLX as one of the BIG 8 because their market cap is so low and inserted BRK.B in its place.
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Image update. I like to personally remove the green/red line and just stick with the EMA line set to 5, but preference is all yours!
This is great! Additional things that would be great, the ability to switch out the top 10 for top 25, etc, and ability to customize which ones. If i'm trading QQQ or SOXL/SOXS I might want different stocks. I'm not a coder, but I saw you were a new coder, you might be able to look at the script "TICK - Custom Tickers [Pt] by PTGAMBLER" as it's a similar indicator but with this option to switch out TICKERS. Another bonus would be if you could add an alerts stream for above 0 and below 0.
BigGuavaTrading
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@codename_trading, I really appreciate the coin donation - my first! I will definitely look into the script you mention for some inspiration as I look to create a more flexible version of this indicator.
One thing I wanted to point out is you can create an alert for this indicator. First, click the alert icon near the top center of your trading view toolbar. Next, change your condition to "Big 8 Intraday TICK" and then whether you want the actual TICK line itself or the EMA. Then, choose the type of action you want alerted on (i.e. crossing, crossing up, crossing down, etc.). From there you can identify whether that action alerts when it crosses a value like zero, or you can choose to have it alert when the TICK crosses over the EMA, which may be the most useful alert to identify possible reversals. As mentioned, I found this to be most useful on lower timeframes, but setting crossover alerts of the TICK and EMA would mean an awful lot of alerts.
If you find something that works best for you, please share!
LiquidityZoom
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Awesome job! This is a great indicator, very underrated!
BigGuavaTrading
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@LiquidityZoom, thank you for the complement! If you've been successfully utilizing this, perhaps combined with other indicators, would love to chat more on how you're using it to find further ways to improve.
Benjaminiannotta
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..and maybe an option to add additonal markets like the UK and China
BigGuavaTrading
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@Benjaminiannotta, again, the concept could be applicable to UK or China Indices/ETFs where a small basket of stocks heavily influenced movement of the indice/ETF. @loving0 had a similar request for an indicator where you could choose your own companies. I love the idea, just haven't had time to begin coding. I could see it useful if you are an IWM trader where you'd want to track it's top weighted stocks for leading movement/trend strength.
Benjaminiannotta
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Hi. can it be used on crypto? thanks
BigGuavaTrading
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@Benjaminiannotta, this indicator focuses on the major influencers of the S&P and NASDAQ and is best utilized when trading those stocks. The concept could be extended to Crypto if there were multiple tickers whose movement also had outsize influence on the crypto in question.
loving0
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Really love this time of work 🙏❤ Just wanted to ask if its possible to add a feature where we can personally choose which companies to include as weightings in the major stock indicies change quarterly , especially with nasdaq.
And lastly , what were your findings when letting the tick run on a 24hr basis before it resets ?
Looking forward to your feedback 🙏
BigGuavaTrading
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@loving0, thanks much! Your idea is a great one and I'll take it for action to build out another indicator that does just this and share it... first I have to learn the right coding to do it - I'm just a novice coder and trader with ideas. I could see it being useful especially if you want to trade one specific sector ETF where you could enter the heavier weighted stocks in that ETF to really ride trends.
As far as a 24 hr basis goes - it won't apply because it would only work pre and post market when these 8 stocks are traded, but those hours the price action is too inconsistent and jumpy to be useful when trading ES/SPX/SPY. There are a couple other indicators you may find useful, specifically one called "Money Flow Oscillator 2" by Sherwind. Use ES1! as the first option and VIX as posted by "CAPITALCOM" for the 2nd... you can generally use both of those 24 hours to help stay in trend long or short. During market hours I like SPXL and UVXY for the settings on that.