Funded Inventors 2

Fixed Settings (Non-editable):
The script uses predefined settings for variables like length1, length2, siglength, oblvl, and oslvl. These control the look and behavior of the calculations.
src = close: The source for calculations is the closing price of each candle.
fr: A boolean flag used to toggle between displaying certain parts of the indicator.
oblvl and oslvl represent overbought and oversold levels, respectively.

CSF Calculation:
The script uses a function (calc_csf) to calculate a "cumulative smoothing factor" (CSF). This is an exponentially weighted value that smooths the price data over time based on the given lengths (length1, length2).

Primary and Signal Calculations:
pmol2: A smoothed value derived from the CSF calculation.
pmol: Another smoothed value, further adjusted.
pmols: The exponential moving average (EMA) of the pmol value, with the siglength period.

Divergence Calculation:
The difference d between pmol and pmols is calculated, which is plotted as a histogram. This divergence can provide insight into momentum shifts or trend strength.

Plotting:
The script plots several visual elements:
DummyL: A circle plot representing either pmol or pmols, depending on the condition set by fr.
MidLine: A horizontal white line at the zero level, acting as a reference.
Histo: A histogram of the d values (difference between pmol and pmols).
OB/OS Levels: Overbought and oversold levels are plotted as gray lines.

Region Filling:
The script fills the region between the DummyL plot and the histogram (Histo):
Green fill for positive values.
Red fill for negative values.
Transparency is added to the fill to create a subtle visual effect.

Purpose:

This indicator helps identify trends and momentum shifts by calculating the smoothed divergence between two moving averages. The use of the histogram and fill colors helps visually represent positive and negative momentum. The overbought/oversold levels provide reference points for potential market extremes.

In essence, the "Funded Inventors 3" indicator is useful for traders looking to track the momentum and possible trend reversals in the market, providing a clear visual representation through histograms and smoothed curves.