SCAD Uses Accumulation/Distribution Trendline Crossings to Flag Reversals

Summary

SCAD is a chart indicator designed to flag possible reversals or pullbacks. It draws a trend line through extreme points on the Accumulation/Distribution (A/D) indicator, then treats a crossing of that line by A/D as a signal that price may also cross a trend line on its chart. The document describes the underlying idea and the indicator’s configurable options, including the volume input, the lookback window, and a setting that excludes recent bars from signal checks.

Optional CCI filtering can screen signals, with controls for the CCI period, price input, and filter levels. Display options control arrows, trend lines, and the search area. The document provides no backtest, performance data, or examples establishing predictive accuracy. Its claim is that an A/D crossing may precede a price trendline crossing, so signals should be treated as possible reversal or pullback indications rather than confirmed forecasts.

Key ideas

• SCAD searches for crossings of a trend line drawn through extreme points in the A/D indicator.
• An A/D crossing is presented as a possible precursor to a price trendline crossing.
• The lookback window and exclusion of recent bars adjust which crossings qualify as signals.
• CCI filtering is optional and can use customized calculation settings and threshold levels.
• The document explains settings but gives no empirical evidence of signal performance.

Tags

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