Binary Rainbow Oscillator for Simple Trend States

Summary

This brief description presents a binary form of the Rainbow Oscillator, based on Mel Widner’s Rainbow Average, which it compares to Guppy multiple moving averages. The indicator reduces its output to two conditions: an upward state and a downward state. This makes its signal easier to consume where a system needs a simple indicator value, including use by automated trading experts.

The document does not explain the calculation, thresholds, input data, or how the two states are derived from the underlying averages. It provides no charts, performance results, or guidance for entries, exits, and risk controls. As a result, it introduces the indicator’s intended output but is not sufficient to reproduce or evaluate a trading strategy. The binary state can describe direction, but the text does not establish that it predicts future returns or specify how it should be combined with other signals.

Key ideas

• The indicator is a binary version of the Rainbow Oscillator based on Mel Widner’s Rainbow Average.
• It reports either an upward or downward state.
• The simplified output is intended for systems that need a direct indicator value.
• The description gives no calculation details or evidence of trading performance.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.