Osc Normalization by Brian Bell Tradestation Indicators Forex Trading Systems - XEATrade - Metatrader, Metastock, Tradestation, Amibroker

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Group: Tradestation Indicators

Title: Osc Normalization by Brian Bell

Description: This month, we'll look back at Brian Bell's article "Normalization" from the October 2000 STOCKS & COMMODITIES. In his article, Bell defines four different techniques for normalizing oscillators. For this month's Traders' Tip, I have created an EasyLanguage function for normalizing oscillators, based on each normalization method described by Bell. The EasyLanguage functions given here have been written specifically so that they can easily be used with any oscillator. The oscillator value is simply specified as one of the input parameters for the function. Following the EasyLanguage for the different functions, I have also created a sample indicator that utilizes all four of the normalization functions and allows the user to specify the oscillator and the type of normalization to use.

Type: Function, Name: NormAvg

Inputs: OscValue(Numeric), NormPrice(Numeric), NormLength(Numeric);
Variable: AvgValue(0); 

AvgValue = Average(NormPrice, NormLength);

If AvgValue <> 0 Then
NormAvg = OscValue / AvgValue
Else
NormAvg = 0;



Type: Function, Name: NormStdDev 
Inputs: OscValue(Numeric), NormPrice(Numeric), NormLength(Numeric);
Variable: StdDevVal(0);

StdDevVal = StdDev(NormPrice, NormLength);

If StdDevVal <> 0 Then
NormStdDev = OscValue / StdDevVal
Else
NormStdDev = 0;



Type: Function, Name: NormATR 
Inputs: OscValue(Numeric), NormLength(Numeric);
Variable: ATR(0);

ATR = AvgTrueRange(NormLength);

If ATR <> 0 Then
NormATR = OscValue / ATR
Else
NormATR = 0;



Type: Function, Name: NormRange 
Inputs: OscValue(Numeric), NormLength(Numeric);
Variable: HiHi(0), LoLo(0), HighLowDiff(0);

HiHi = Highest(OscValue, NormLength);
LoLo = Lowest(OscValue, NormLength);
HighLowDiff = HiHi - LoLo;

If HighLowDiff <> 0 Then
NormRange = ((OscValue - LoLo) / HighLowDiff) * 100
Else
NormRange = 0;



Type: Indicator, Name: Osc Normalization

Inputs: NormType(1), OscValue(Momentum(Close, 10)), NormPrice(Close), NormLength(8);
Variable: NormOsc(0); 

If NormType = 1 Then Begin
NormOsc = NormAvg(OscValue, NormPrice, NormLength);
Plot1(NormOsc, "Norm Osc");
Plot2(0, "Balance");
End;
If NormType = 2 Then Begin
NormOsc = NormStdDev(OscValue, NormPrice, NormLength);
Plot1(NormOsc, "Norm Osc");
Plot2(0, "Balance");
End;
If NormType = 3 Then Begin
NormOsc = NormATR(OscValue, NormLength);
Plot1(NormOsc, "Norm Osc");
Plot2(0, "Balance");
End;
If NormType = 4 Then Begin
NormOsc = NormRange(OscValue, NormLength);
Plot1(NormOsc, "Norm Osc");
Plot2(50, "Balance");
End;

Author/Source: Brian Bell