{quote} Hi, thanks for the fast response. Some things to add: It's an indicator and it is open source. Here is the original: https://www.tradingview.com/script/w...lar-Arbitrage/ Big thanks also to the coder koubeissy.ibrahim.e . Or is my understanding of open source by tradingview rules wrong? The indi does something very important. It gives the direction an potential tp. {image} I'm not interested in any EA. I do need only this litte indi with mt4. There is...
https://www.investopedia.com/terms/t...rarbitrage.asp
I have no idea how you figured out that this indicator shows when to enter and when to exit a trade???
The idea of Triangular Arbitrage has nothing to do with such signals - it only calculates if the Arbitrage will bring profit, or loss.
Like it is described in investopedia, the idea is to operate on 3 assets, for example:
Step 1. Buy Euro for USD (EURUSD) - this means Buy on EURUSD at Ask,
Step 2. Buy CHF for EURO (EURCHF) - this means Sell on EURCHF at Bid,
Step 3. Buy USD for CHF (USDCHF) - this means Buy on USDCHF at Ask.
This compound transaction can result in a profit or a loss.
So, in order to properly calculate this, we need to take into account several aspects of charts and prices.
Therefore, the pinescript formula is not a universal formula, it is a specific formula for a specific case (specific instruments).
This specific case was published as open source, but the indicator itself can not be universal with only this script.
I have figured that out in MT4.
Again, in order to get the correct result, we must follow the logic.
Maybe in TradingView we can construct any chart - EURUSD, or USDEUR - and get the price data from them?
In MT4 that is more difficult, so looking at the above example:
Step 1. requires multiplication,
Step 2. requires division (we don't have CHFEUR),
Step 3. requires multiplication.
In other cases we might not have specific charts, so we must tell the indicator what we want.
For example, I want this:
Step 1. Buy EUR for PLN (we have EURPLN - multiplication),
Step 2. Buy USD for EUR (we have EURUSD - division),
Step 3. Buy PLN for USD (we have USDPLN - division).
If the indicator must be universal, we must provide options to reverse every one of the three symbols.
And we must know exactly what we are doing, because this indicator can not think for us.
The value of the histogram is the ammount in money per 100 units we would profit or lose on such an operation.
And, there will be other issues in MT4:
1. We must remember to download all the data for the timeframes of the symbols we will be using,
2. If the mathematical operation is not right for any of the symbols, the indicator plots something else - don't know what?
3. Brokers use different names for symbols, prefixes, suffixes, etc., so we must make sure we input the symbols correctly.
Otherwise - don't change the indicator name or it will not work!
Please share your strategy how you are interpreting this indicator for entry and exit.
BTW. What good is an indicator which shows that we could have made or lost money in the past?
And what good is an indicator which uses the Close price in the past?
In the Triangular Arbitrage idea we Buy or Sell.
In reality we Buy at Ask Price and we Sell at Bid Price.
Thus, in order to calculate the TA, we need the Ask and Bid prices, not the Close price.
So, I am asking anybody: How is this useful for predicting the future?
The only useful arbitrage is when we know the future price of an asset - this can be a few seconds earlier, or for some people this can be some milliseconds earlier.
