RoC Leader Strategy by sdperrault
By sdperrault
Performance Metrics
- Author: sdperrault
- Symbol: NASDAQ:QQQ
- Timeframe: 4 minutes
- Win Rate: 25.2%
- Profit Factor: 0.981
Description
This script was created to identify areas of strong momentum and avoid chop. It combines two different parameters into a single lagging metric. Parameters: 1. Rate of Change (RoC) StrengthThis measures how much momentum is building in price right now, expressed as a simple 0–100% strength reading.Here's the idea: the script tracks a short-term trend line (a 9-period exp moving average) and checks how far that line has moved over the last 3 bars. A big move means momentum is picking up; a small move means things are flat or stalling. That raw reading is then smoothed out to reduce noise, and compared against the strongest move seen so far in the current trading session. The result is a normalized strength score — 100% means momentum is as strong as it's been all day, while a low reading means the current move is weak relative to today's own range.It's not trying to tell you which direction things are moving — just how forcefully. 2. Leader (MACD Leader, see script VWMACD + Leader)This is the directional engine of the strategy — it's designed to catch shifts in momentum slightly before the standard MACD does, rather than lagging behind price the way MACD typically does. Here's the idea: it starts from the same MACD calculation everyone knows (the gap between a fast and slow moving average), but instead of just watching that line rise and fall, it tracks the rate of change of that line — essentially asking "is MACD's own momentum accelerating or decelerating right now?" That reading is then smoothed twice to filter out noise, and rescaled so it sits on the same visual scale as MACD itself.If you are using the volume-weighted MACD + leader script, this current one essentially determines a) if the leader is IN FRONT of the move, showing which direction it should be heading, and b) how strong that is, based on the gap between the leader and the MACD line. The two above are combined into a single line that essentially shows the slope of the price movement, and confidence in that from the MACD Leader and distance from it. Because it's a combination, having one of them be quite strong can be enough to show signal. On the chart, you'll see I have only the combined, MACD leader, and RoC lines showing, with the rest unchecked. I changed RoC line to be white and dashed, MACD parameter to be yellow dashed, and only used green/red for the combined to reduce confusion. In this case it is a 4 min chart, and I have the threshold for showing signal set to 0.2 See other scripts: VWMACD + Leader, Buy/Sell Volume + LeaderI update the scripts frequently, please remember to keep yours updated. This script is set to reset each day at open.