ADI Market Internals Matrix

Created by ADI

Note: It is recommended to use the ADI Market Internals Matrix in conjunction with other technical analysis tools for comprehensive market evaluation and to ensure robust risk management practices. If you want to learn more about this script and how to use it join our discord community.

ThinkOrSwim Link (V2.0)
TradingView Link(V2.0) 

Version:

• V1.0 BETA 

• V2.0: Synthesised VIX into the Last hour of trading (Can be Changed). During the Last hour, the histogram bars change color based on the VIX trend.

Description: The ADI_Market_Internals_Matrix is a trading tool designed to provide real-time insights into market trends and volatility during trading hours, with a particular focus on the last hour of trading. It utilizes key market internal data such as $ADD (Advance/Decline Differential) and $VOLSPD (Volume Speed) along with the VIX (Volatility Index) to offer traders visual cues on market direction and momentum through a histogram display. During the last hour and 3 minutes of trading, the histogram bars change color based on VIX trend.

Features:

• Histogram Analysis: Provides a color-coded histogram that visually represents the trend direction. Green indicates a bullish trend, red signals bearish conditions, and gray denotes a neutral market, based on the closing values of $ADD and $VOLSPD relative to their respective EMAs (Exponential Moving Averages).

• VIX Monitoring: Includes a VIX label that changes color based on user-defined thresholds to indicate bullish or bearish bias, enhancing decision-making during volatile market conditions.

• Customizable Parameters: Users can adjust various settings such as EMA length, VIX threshold, histogram width, and the loopback period for trend calculations to tailor the tool to their trading style and market conditions.

• Time-Sensitive Analysis: Designed to activate particularly during the last trading hour, a period known for increased market activity, to help traders make informed closing decisions.

• VIX Trend: Includes an option to have the color histograms based on VIX trends. Magenta bars indicate a bullish trend(VIX falling), whereas dark red bars indicate a bearish trend(VIX Rising). 

Usage:

• Market Hours Operation: Best used during active market hours, especially effective in the last hour to analyze high volatility and volume.

• Trend Analysis: Observe the histogram's color shifts to gauge the overall market direction quickly. A predominance of green suggests bullish conditions, while red indicates bearish trends.

• Volatility Assessment: Keep an eye on the VIX label to understand market volatility relative to the entered VIX pivot, aiding in establishing a market bias.

• Customization: Adapt the script's sensitivity by modifying the lengths for EMAs, VIX threshold, start time, and loopback period based on personal preferences and current market dynamics. Also, adjust when the VIX Trend shows up.