Sentiment Score Indicator V1.1

6 дней назад

Sentiment Score Indicator

The Sentiment Score Indicator attempts to gauge market sentiment by analyzing price action relative to Bollinger Bands and multiple Simple Moving Averages (SMAs). The indicator dynamically calculates a sentiment score ranging from -100 (Strong Bearish) to +100 (Strong Bullish) to provide insight into potential market direction and strength.

How the Sentiment Score is Calculated

The sentiment score is derived through a multi-step process that evaluates market conditions:

Bollinger Bands Analysis:

The script assesses the price’s position relative to the upper and lower Bollinger Bands.
When the price approaches or exceeds the upper band, it indicates potential overbought conditions and contributes to a bullish sentiment score.
Conversely, when the price nears or falls below the lower band, it signals potentially oversold conditions, contributing to a bearish sentiment score.
The magnitude of deviation from these bands influences the score, making it sensitive to volatility.

Moving Averages Evaluation:

The script incorporates multiple hardcoded SMAs to identify trends.
If the price is above these SMAs, the score is adjusted upward to reflect more bullish momentum.
If the price is below these SMAs, the score decreases to reflect more bearish momentum.
Each SMA provides a different perspective on short-term and long-term trends and are used in conjunction with determining the overall score at any given time.

Adaptive Scaling:

A scaling factor adjusts the sensitivity of the sentiment score based on market conditions.
This ensures the indicator remains responsive in both high-volatility and low-volatility environments.

Key Features

• Dynamic Sentiment Score: Real-time sentiment ranging from Strong Bullish to Strong Bearish.
  
• Combines Bollinger Bands and SMAs to assess overbought/oversold conditions and trend strength.
  
• Color-Coded Labels: Intuitive color coding for quick interpretation of sentiment.
  
• Works effectively on multiple time frames, including monthly, weekly, daily, intraday, and even down to 1-second chart data.
  
• Toggle Option: Users can choose to display the sentiment score only on the last candle to reduce chart clutter.
  

Sentiment Score Ranges

Score Range Sentiment Color
+75 to +100 Strong Bullish Dark Green 🟩
+50 to +75 Bullish Green 🟩
+25 to +50 Medium Bullish Light Green 🟩
+10 to +25 Slightly Bullish Yellow-Green 🟨
-10 to +10 Neutral Yellow 🟨
-25 to -11 Slightly Bearish Orange-Yellow 🟧
-50 to -26 Medium Bearish Orange 🟧
-75 to -51 Bearish Dark Orange 🟥
-100 to -76 Strong Bearish Dark Red 🟥

How to Use

1. Add the Indicator to your preferred candlestick chart.
   
2. Interpret the Sentiment Labels displayed above or below each candlestick (you can toggle to only show the label on the last candle or all candles), this will be a numerical value accompanied by the range description (as per the above Sentiment Score Ranges).
   
3. Use the Color-Coded Scores to quickly gauge sentiment strength and direction.
   
4. Combine with Other Tools: For better analysis, use this indicator alongside other forms of technical analysis.
   

Disclaimer
This tool is for educational purposes only and does not constitute financial advice. Always conduct your own research and practice proper risk management.