Measuring Trend Strength Across Lookbacks and Timeframes

Summary

This indicator estimates trend direction and strength by calculating Pearson correlation between price and time across lookbacks from 50 to 500 bars, in steps of 50. Users can select up to four timeframes. A table displays the correlations, averages across timeframes for each lookback, and the strongest positive and negative readings overall and within each timeframe.

Color coding distinguishes stronger positive and negative correlations, with special colors for the strongest overall readings. The document defines significant trends as correlations of at least 0.5 or at most -0.5, and suggests using the strongest lookback to help select settings for other indicators. It describes the indicator’s calculations and display features, but provides no performance tests or evidence that correlation predicts future returns. Treat the readings as descriptive measures of recent price movement, not as a standalone trading signal.

Key ideas

• The indicator measures correlation between price and time over ten lookback lengths from 50 to 500 bars.
• Users can compare readings across as many as four selected timeframes.
• Averaged correlations summarize each lookback across the selected timeframes.
• The script marks correlations of 0.5 or greater and -0.5 or lower as significant trends.
• Its output describes historical price behavior and does not establish predictive performance.

Tags

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