Newton's 2nd Law and the Market

2020年12月26日

This is my first pine script and is (probably) of no practical value whatsoever; however, it is interesting. The idea was to apply Newton's 2nd Law of motion (force = mass x acceleration) to the market and see what pops up. To do this, I applied Ohm's Law, the electrical version of Newton's 2nd, in the following manner; Voltage (V), or potential, is defined as the delta of the high and low (or open and close) of a bar. Amperage (I), or current, is defined as the volume of trades within the bar. Resistance (R) is then calculated using the Ohm's Law formula of R=V/I, and Power (P) is then defined as P=V*I. The plotted values are normalized EMA of the RSI of these series.

The implication is that Resistance (R) *should* be the price, and you can see how when using a "voltage" of open/close (vs. low/high), the R line always moves in the opposite directions of the price. When using low/high, it tends to move in the same direction as the price.


//version=4
study(title="Tholonic Pattern", shorttitle="Tholonic", overlay=false)

proc(_src,len) =>
a=rsi(_src, len)
a:=ema(a,len) // the EMA is taken 3 times here because three EMAs of 4 is a lot smoother and tighter than one EMA of 16
a:=ema(a,len)
a:=ema(a,len)

// —————
len = input(title="EMA and RSI Length", type=input.integer, defval=5)
showBlu_V= input(title="Show V (blue - hi/lo delta)?", type=input.bool, defval=true)
showRed_I= input(title="Show I (red - volume)?", type=input.bool, defval=true)
showGre_R= input(title="Show R (green - balanced price)?", type=input.bool, defval=true)
showYel_P= input(title="Show P (yellow - 'power')?", type=input.bool, defval=true)
showClose= input(title="RSI/EMA of close?", type=input.bool, defval=false)
hloc= input(title="Use High/Low (vs Open/Close)?", type=input.bool, defval=true)

// using hi-lo vs. close-open has a significent effect
pole1 = low
pole2 = high

if hloc
pole1 := open
pole2 := close

V=pole2-pole1 // Price range defines the range and equates to Voltage, or potential (which equates to FORCE)
I=volume // Volume defines the movement and equates to Amperage, or current (which equates to ACCELERATION)
R=V/I // Price defines the agreement between two opposing forces and equates to Resistance (which equates to MASS)
P=V*I // In the electrical world, this is POWER... no idea what is means here
C=close

mV=proc(V,len)
mI=proc(I,len)
mR=proc(R,len)
mP=proc(P,len)
mC=proc(C,len) // Don't know why this has a differenmt scale than the others

lw=1
plot(series=mV,style=plot.style_line, linewidth=lw, color=iff(showBlu_V,color.blue,na))
plot(series=mR,style=plot.style_line, linewidth=lw, color=iff(showGre_R,color.green,na))
plot(series=mI,style=plot.style_line, linewidth=lw, color=iff(showRed_I,color.red,na))
plot(series=mP,style=plot.style_line, linewidth=lw, color=iff(showYel_P,color.yellow,na))
plot(series=mC,style=plot.style_line, linewidth=lw*2,color=iff(showClose,color.aqua,na))
hline(50)

var label V_lbl = na
var label I_lbl = na
var label R_lbl = na
var label P_lbl = na
var label C_lbl = na
var label notice = na

label.delete(V_lbl)
label.delete(I_lbl)
label.delete(R_lbl)
label.delete(P_lbl)
label.delete(C_lbl)
label.delete(notice)


spacer =" " // I don't know how to set the x position to teh right of the last bar :/
sadd=" "
V_lbl := label.new(bar_index, high, text = spacer+"V", style = label.style_none, size = size.normal)
label.set_xy(V_lbl, bar_index, mV)
label.set_textcolor(id=V_lbl, textcolor=color.blue)

R_lbl := label.new(bar_index, high, text = spacer+sadd+"R", style = label.style_none, size = size.normal)
label.set_xy(R_lbl, bar_index, mR)
label.set_textcolor(id=R_lbl, textcolor=color.green)

I_lbl := label.new(bar_index, high, text = spacer+sadd+sadd+"I", style = label.style_none, size = size.normal)
label.set_xy(I_lbl, bar_index, mI)
label.set_textcolor(id=I_lbl, textcolor=color.red)

P_lbl := label.new(bar_index, high, text = spacer+sadd+sadd+sadd+"P", style = label.style_none, size = size.normal)
label.set_xy(P_lbl, bar_index, mP)
label.set_textcolor(id=P_lbl, textcolor=color.yellow)

if showClose
C_lbl := label.new(bar_index, high, text = spacer+sadd+sadd+sadd+sadd+sadd+sadd+"CLOSE", style = label.style_none, size = size.normal)
label.set_xy(C_lbl, bar_index, mC)
label.set_textcolor(id=C_lbl, textcolor=color.aqua)

noticeTxt = hloc ? "Using High/Low" : "Using Open/Close"
notice := label.new(bar_index,90, text = noticeTxt, style = label.style_none, size = size.large)
label.set_textcolor(id=P_lbl, textcolor=color.white)