The Sentiment Ratio indicator gauges current Market Sentiment between -100% and 100%, where lower than -40% is considered Bearish and higher than 40% Bullish. The channel between the two is considered Neutral.
The indicator has been particularly effective on H4 charts when used to confirm the direction of potential trading signals. On shorter term charts, when the indicator crosses -40 or 40 back to Neutral, it can be effective when indicating potential swings; for example, a sell signal when the indicator crosses below 40 and a buy signal when the indicator crosses above -40.
A version applied to EURUSD H1 has been updating twitter feed @tssmarkets.
Example call function:
int SentimentSignal(double triggerLevel)//Return signal if trigger level activated
double sentimentRatio=iCustom(NULL,0,"Sentiment Ratio",0,0,0);
else if(sentimentRatio<=-triggerLevel) return(OP_SELL);
return(-1);//Default: No Signal
Basis of calculation:
The calculation in the indicator applies weighted averages from RSI, Stochastic Oscillator and William’s Percent Range.