Auto Motive Wave [Trendoscope]

Earlier we created an interactive script to study Motive Waves by manually selecting the wave patterns on the chart.

You can find the open source script here:

In this indicator, we will try to do it automatically. Hence, you don't need to draw the waves manually to check anymore. The indicator will do it for you.

🎲 Conditions for Motive Wave
Rules for Motive Waves remain same as before. Motive wave can be either Impulse or Diagonal Wave. Diagonal wave can be either expanding or contracting diagonals. To learn more about diagonal waves, please go through this idea.

🎲 Rules for generic motive waves are as below

• Pivots in order - Checks wether the pivots selected are in progressive order.
  
• Directions in order - Checks if the pivot directions are correct - either PH, PL, PH, PL, PH, PL or PL, PH, PL, PH, PL, PH
  
• Wave 2 never moves beyond the start of wave 1 - Wave 2 retracement is less than 100% of wave1
  
• Wave 3 always moves beyond the end of wave 1 - Wave 3 retracement is more than 100% of wave2
  
• Wave 3 is never the shortest one - Checks if Wave 3 is bigger than either Wave 1 or wave 5 or both.
  

🎲 Now, these are the specific rules for Impulse Waves on top of Motive Wave conditions

• Wave 4 never moves beyond the end of Wave 1 - meaning wave 1 and wave 4 never overlap on price scale.
  
• Wave 1, 3, 5 are all not extended. We check for retracement ratios of more than 200% to be considered as extended wave.
  

🎲 Below are the conditions for Diagonal Waves on top of Motive Wave conditions

• Wave4 never moves beyond the start of Wave 3 - Wave 4 retracement is less than 100%
  
• Wave 4 always ends within the price territory of Wave 1 - Unlike impulse wave, wave 4 intersects with wave 1 in case of diagonal waves. This is the major difference between impulse and diagonal wave.
  
• Waves are progressively expanding or contracting - Wave1 > Wave3 > Wave5 and Wave2 > Wave4 to be contracting diagonal. Wave1 < Wave3 < Wave5 and Wave2 < Wave4 to be expanding diagonal wave.
  

Settings are for the indicator include option to select zigzag length, theme color, and few constraints about the waves to be scanned. You can use the tooltips to find more about them

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Update libraries

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Updates related to new pine features and performance.

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Added alerts on identification of impulse wave