WaveTrend Oscillator CVD-Z
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WaveTrend Oscillator CVD-Z

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The WaveTrend Oscillator CVD-Z indicator fuses two independent analytical systems—a multi-timeframe WaveTrend oscillator and a Cumulative Volume Delta (CVD) Z-Score—into a single pane by scaling the CVD z-score into the WaveTrend's ±100 range.

This scale-mapping enables direct visual comparison between momentum extremes and volume-delta extremes on the same axis. It powers a combined signal system that fires only when a WaveTrend crossover after an extreme zone coincides with a CVD climax event within a defined temporal window.

WHAT MAKES THIS ORIGINAL

1. Z-Score to Oscillator Scale Mapping

The CVD Z-Score (ranging from approximately -3 to +3) is multiplied by a configurable scale factor (default: 30) and clamped to ±100. This maps it directly onto the WaveTrend range.

  • A z-score of ±2.0 (statistical extreme) maps to ±60.
  • This aligns with WaveTrend's Overbought/Oversold Level 1.

    • This alignment means that when both the CVD line and WaveTrend line enter the extreme zone simultaneously, two independent dimensions (momentum and volume-delta) confirm the same condition.

    2. Temporal Windowed Combo Signal

    The W+CVD combo signal requires two conditions within a 5-bar lookback window:

  • A WaveTrend WT1/WT2 crossover occurs after the oscillator has been in an extreme zone.
  • A CVD climax diamond appeared within the last 5 candles.

    • This window accounts for the natural lag between momentum shifts and volume-delta shifts. When a combo fires, smaller standalone signals are suppressed to keep the chart clean.

    3. Effort-versus-Result Efficiency Metric

    The dashboard classifies market states by comparing price movement to CVD movement ($| \Delta Price | / | \Delta CVD |$):

  • Breakout (Ratio > 5): Price moves significantly relative to volume delta; indicates genuine commitment.
  • Churn (Ratio < 0.5): High volume delta but little price response; indicates absorption or distribution.
  • Balanced: Normal distribution of effort and result.

    • USAGE

    Reading WaveTrend Signals

    The oscillator displays two lines (WT1 and WT2) between +100 and -100.

  • Overbought (> +60): Market is overextended to the upside.
  • Oversold (< -60): Market is overextended to the downside.

    • Reading CVD Z-Score

    The CVD Z-Score line tracks cumulative buying vs. selling pressure. A rising line shows increasing net buying pressure relative to recent history.

    Special Markers

  • Climax Diamonds: Appear when the CVD Z-Score enters an extreme zone (±2.0 raw / ±60 scaled).
  • Alignment Stars (★): Appear when Current, 15m, and 1hr WaveTrends are all in extreme territory.
  • W+CVD Combo Signals: Large triangles indicating a confluence of WaveTrend crossovers and CVD climaxes.

    • DETAILS

    WaveTrend Calculation

  • EMA of typical price (HLC3) over the channel length.
  • Absolute deviation from this EMA, smoothed with another EMA.
  • Normalized difference (CI) smoothed to produce WT1; a 4-period SMA of WT1 produces WT2.

    • CVD Z-Score Calculation

    CVD is built bar-by-bar (Bullish bars add volume; Bearish subtract). The z-score normalizes this: $$Z = \frac{CVD - SMA(CVD, lookback)}{StDev(CVD, lookback)}$$

    Spot Accumulation Detection

    The "Accumulation" phase triggers when three conditions align:

  • CVD Z-Score is positive and rising.
  • Price range is contained within 1.5× ATR (flat price).
  • Open Interest (OI) is declining.

    • SETTINGS

    Main Chart Signals

  • Multi-TF Alignment Stars: Stars when Current + 15min + 1hr align in extreme zones.
  • W+CVD Combo Signals: Large triangles for WaveTrend/CVD confluence.
  • Candle Coloring: Based on multi-timeframe WaveTrend alignment.

    • WaveTrend & CVD

  • Channel/Average Length: Default 10 and 21 respectively.
  • CVD Scale Factor: Multiplier (default: 30) to map z-score to the oscillator.
  • OI Ticker: Symbol for Open Interest data used in efficiency analysis.

    • Multi-Timeframe

  • Show 5m / 15m / 1hr: Toggle higher timeframe oscillators.
  • Auto-Hide Logic: Automatically hides higher timeframes if the chart period exceeds them.

    • METHODOLOGY

    The source code is protected to preserve the specific implementation of the z-score-to-oscillator mapping, the temporal windowed combo logic, the effort-versus-result efficiency classifier, and the spot accumulation detector. These integration techniques create analytical value beyond what individual WaveTrend and CVD components provide separately.

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    Disclaimer: This indicator combines momentum and volume-delta analysis and does not constitute financial advice. Overbought/oversold conditions and CVD climax events do not guarantee price reversals. Past performance does not guarantee future results.