CipherWave - decode hidden trends

CipherWave by SimpleScalps – Decode Hidden Waves in Price & Flow

CipherWave bundles WaveTrend, Money Flow, Stoch/RSI and optional MACD bias into a single clean oscillator panel.

It is built to quickly answer:

1. 
   • Is momentum currently bullish or bearish?
   • Is capital flowing into the asset or out of it?
   
2. Are we in a potential exhaustion / reversal zone (divergence, extreme levels)?
   

Large circles, divergence markers and a money-flow band make the context easy to read at a glance – without cluttering the price chart.
Use CipherWave as a confluence tool for your own setup, not as a standalone “entry-only” system.

Author: SimpleScalps
Version: v1.6
Core idea: Visualise momentum, flow and divergences in one compact panel.

1. WaveTrend Engine (WT)
The WaveTrend core is the heart of CipherWave. Two WT waves oscillate around the zero line and visualize trend strength, pullbacks and exhaustion.

• 
  • Enable WaveTrend waves – turn the main WT1 & WT2 waves on/off.
  • Show WT Buy markers – small dots when WT crosses up from an oversold zone.
  • Show WT Sell markers – small dots when WT crosses down from an overbought zone.
  • Show GOLD Buy markers – rare “deep discount” buy circles when WaveTrend, RSI/MFI and levels align.
  • WaveTrend Channel / Average / MA Length – control how fast vs. how smooth the waves react to price.
  • WT Source (MA base) – price source used for the WaveTrend calculation (e.g. ohlc4).
  

2. Overbought & Oversold Levels
Three overbought and three oversold bands define premium/discount zones around the zero line.

• 
  • Overbought lvl 1/2/3 – from mild to extreme premium (exhaustion) above zero.
  • Oversold lvl 1/2/3 – from mild to extreme discount below zero.
  • Levels drive the main buy/sell and GOLD conditions (WT cross inside these zones).
  • In v1.6, OB/OS lines can be selectively shown or hidden (lvl1 & lvl2 off by default, lvl3 always visible).
  

3. Money Flow Zone (MFI-style Area)
The Money Flow band shows whether the market is dominated by buying or selling pressure.

• 
  • Show Money Flow area – toggle the MFI-style band on/off.
  • Money Flow period – lookback length for the smoothing.
  • Money Flow sensitivity – multiplier that controls how strongly the band reacts to candles.
  • MFI area Y offset – internal vertical normalization.
  
• Green shades (above zero) = positive flow; red shades (below zero) = negative flow.
  

4. RSI & Stoch Overlay
Two oscillators plotted inside CipherWave to refine timing and spot overextension.

• 
  • The RSI-style line acts as a smoother, medium-term push.
  • The Stoch line is faster and changes color depending on whether it is above or below the RSI line.
  
• When Stoch extends far away from RSI, it can hint at short-term exhaustion or potential snap-back.
  

5. MACD Overlay on WT (optional)
Adds higher-timeframe MACD bias to the WaveTrend colors.

• 
  • Enable MACD-based WT colors – color WT segments based on MACD direction plus money-flow bias.
  • MACD colors – MACD timeframe – choose the HTF used for MACD context (e.g. 4H while trading 5–15m).
  
• Bullish MACD + positive flow → stronger bullish WT coloring; bearish MACD + negative flow → stronger bearish WT coloring.
  

6. Fast WT / VWAP Band
A “fast” WaveTrend/VWAP-style band around zero that reacts quickly to intraday impulses.

• 
  • Show Fast WT / VWAP band – toggle the band on/off.
  • When this band pushes in the same direction as WT, it often confirms momentum.
  When it flattens or fades, it can warn of slowing pressure.
  

7. Bull & Bear Divergences
CipherWave automatically detects regular and optional hidden divergences on WT.

• 
  • Show regular WT divergences – classic bullish/bearish divergences (higher price high vs. lower WT high, etc.).
  • Show hidden WT divergences – optional continuation-style divergences in the trend direction.
  • Hidden divs: ignore OB/OS thresholds – allow hidden divergences even outside defined OB/OS bands.
  • Bearish/Bullish divergence min (WT) – how “high” or “low” WT must be to validate a divergence.
  
• 2nd divergence band – secondary thresholds for mapping more subtle divergence zones.
  

8. Display & Theme
Adjust the look of CipherWave to fit your chart.

• 
  • Dark background mode – soft dark overlay behind the oscillator panel.
  • WT1/WT2 Fill – area fill colors of both WT waves.
  • VWAP color – color of the fast WT/VWAP band.
  • MFI Color > 0 / < 0 – positive/negative money flow colors.
  • WT Buy/Sell Dot colors – color of small buy/sell dots.
  • WT Bear/Bull Div colors – color scheme for divergence segments.
  
• OB/OS lvl line toggles – switches to show/hide OB1, OB2, OS1, OS2 level lines.
  

How to Use CipherWave (Typical Workflow)

1. 
   • Mark key support/resistance or supply/demand on your chart.
   • Watch WaveTrend around Overbought/Oversold lvl 2–3 for potential extremes.
   • Check the Money Flow band: green for longs, red for shorts.
   • Look for divergence markers and especially GOLD Buy circles as strong reaction zones.
   • Use RSI & Stoch distance to judge if a move is stretched or losing steam.
   • Combine everything with your own price action, structure, RR and risk management.
   

Disclaimer
This script is for educational and informational purposes only and does not constitute financial advice.
Always backtest your ideas, manage risk properly and trade at your own responsibility.