Traders Dynamic Index (TDI)

Traders Dynamic Index indicator for NinjaTrader

The Traders Dynamic Index is a trend following momentum indicator based on the RSI. The RSI calculation itself applies slightly different settings than the standard RSI version.

Indicator Description

First, a 13 period average is used, as opposed to the standard RSI 14 period. Secondly, a smoothing period of 2 is used vs. the customary 3 bars applied to the standard RSI. Finally, the Traders Dynamic Index applies the SMA as the basis for its calculation, not the EMA which is used for the standard RSI calculation.

The Traders Dynamic Index indicator comes with the following parameters:

  • The Priceline, which is a SMA(2) of RSI(13)
  • The Signalline, which is a SMA(7) of RSI (13)
  • The Midband, which is a SMA(34) of RSI (13)
  • The BollingerBands around the SMA(34) using 1.62 StdDev

The following combinations may be considered as trade rules:
– go long, if Priceline > 50
– go short if Priceline < 50
– consider an exit, if Priceline is above 68 or below 32

– go long if Priceline > Signalline
– go short if Priceline < Signalline
– exit if Priceline crosses Signalline

– trendfilter long, when Priceline > Midband
– trendfilter short, when Priceline < Midband

– add to long, when Priceline > BollingerBand.Upper
– add to short, when Priceline < BollingerBand.Lower

More information on this indicator is available in our Spotlight on the TDI indicator. It can be used for a variety of setups, for example combining with a Daily Regression Channel or Heikin Ashi trend bias as described in our Indicator Spotlight. Finally, setups can be confirmed with volume or range analysis, for example using the Force Index and/or the Relative Ranges as described in our Indicator Spotlight newsletter.

Other library momentum oscillators

By applying the Library Roofing Filter you may correct distortions in the fixed scale threshold readings.  The MESA Stochastics indicator comes with an integrated Roofing Filter. If you use an oscillator that do not apply a fixed scale, you may review our Indicator Spotlight on the Z-score and normalization.

Other than the TDI indicator, our standard momentum oscillators category feature a number of other entries, such as the Acceleration Deceleration, Double Smoothed Momentum, Know Sure Thing, LBR 3/10, Stochastics, Fast Stochastics and the Relative Strength Index. We also have a category for advanced oscillators, with among others the Laguerre RSI, Connors RSI, Projection Oscillator and the SVE Stochastics ITF. These tools build on the same concept as the standard momentum oscillators, but with a higher degree of sophistication. In general, they allow for added value approaches, utilizing a set of more complex algorithms.

The Traders Dynamic Index indicator is available for NinjaTrader 8.