Daily Trend Signals from Four Technical Indicators

Summary

This note describes a daily stock trend indicator that combines MACD, RSI, momentum, and Williams %R into a binary bull or bear signal. Each indicator contributes one vote according to a threshold: MACD and momentum are evaluated against zero, RSI against 50, and Williams %R against -50. The four votes are averaged, then smoothed with a five-period moving average; the output is bullish when that average exceeds 0.49 and bearish otherwise.

The document presents the formula and says it is intended only for daily charts. It offers no backtest, performance results, or rationale for the selected lookbacks and thresholds. The original indicator author's settings are described as undisclosed, so this is a separate approximation rather than a reproduction. The method can be learned as a simple way to combine directional indicator conditions, but the note does not establish that its signals predict returns or explain how to enter, exit, size positions, or manage risk.

Key ideas

• The method converts four indicator conditions into binary votes for a bull or bear phase.
• MACD and momentum are positive-condition checks, while RSI and Williams %R use fixed threshold checks.
• The vote average is smoothed over five periods before producing the final directional signal.
• The author recommends applying the indicator to daily charts, and provides no performance evidence.

Tags

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