In the first video of this series, problems with the raw TRIN values were identified and a Better TRIN Indicator developed. This only required 4 simple steps and can be done with your charting platform. See the TRIN Index video here.
This TRIN Indicator video goes through 5 different ways to use the TRIN Index to pin-point market turning points and improve your trading.
“Better TRIN is one of the best indicators I’ve ever seen.” Thomas K.
“I use Better TRIN all the time and I love it.” Ara V.
“The Better TRIN system – outstanding, excellent.” Gordon R.
1. TRIN Indicator divergence patterns
TRIN Indicator Divergence Patterns and Market Turning Points
Divergence patterns on the TRIN Indicator occur when the market advances but the adjusted TRIN value is negative or vice versa. Since the TRIN Indicator re-sets at the beginning of each day, a market advance is assumed to be when the Close is greater than the Open.
These TRIN Indicator divergence patterns are shown on the chart above as red and white dots on Emini daily bars. Looking back on the chart you can see how well this single indicator warns of potential market turning points. I don’t suggest you use this indicator alone but combine it with other non-correlated market indicators to confirm turning points more accurately.
2. Turning the TRIN Indicator into an oscillator
Emini Turning Points using the Better TRIN Oscillator
You can build a very useful oscillator by cumulating the adjusted TRIN readings and then measuring the distance from a moving average. I then use some simple mathematics to sharpen up the turning points and make the indicator crystal clear to interpret. The result is the Better TRIN Oscillator shown in the chart above, plotted beneath daily Emini bars.
Turns in the Better TRIN Oscillator are shown on the chart as red and white dots on the price bars. Looking back on the chart you can see how well this indicator alone confirms market turning points and measures market momentum. And remember, in the TRIN calculation there is no measurement of price, only the number of advancing/declining issues and advancing/declining volume.
Rather stick with your familiar RSI indicator?
Better TRIN Oscillator vs. RSI
To see how clear the signals are using the Better TRIN Oscillator, compare it to the commonly used RSI. Daily Emini bars are shown at the top of the chart above, then the Better TRIN Oscillator and at the bottom of the chart is the built-in TradeStation RSI.
There’s no comparing the sharpness of the Better TRIN Oscillator signals. I know which indicator I’d rather be using!
3. Divergence patterns on the TRIN Oscillator are very powerful
The Better TRIN Oscillator with Divergence Patterns
An even more powerful way of using the Better TRIN Oscillator is to follow divergence patterns against price. For example, a Bullish divergence pattern is made when the Oscillator makes higher Lows but price is making lower Lows. In the chart above two examples are shown.
In mid-July 2007 the market was still advancing but the Better TRIN Oscillator had made a lower High – an early warning signal of a 160 point drop in the Emini. Then in mid-August the Oscillator made higher Lows while the market was still dropping – again, an early warning signal of an important market turning point.
4. The TRIN Oscillator also works on intra-day charts
Better TRIN Oscillator on 5 minute Emini chart
If you’re a day trader you can also use the Better TRIN Oscillator on intra-day charts. Any minute or hourly bar interval can be used, but unfortunately a TradeStation restriction prevents tick charts from being used.
The chart above shows the Better TRIN Oscillator superimposed on 5 minute Emini bars. The sharp tuns in the oscillator make it easy to interpret.
But remember, you should always be trading with the trend. And the best signals will be turns in the Better TRIN Oscillator that are in the direction of the intra-day trend.
5. Trading systematically with the TRIN Indicator
Equity Curve for the Example Better TRIN Systems (2002-2012)
The Better TRIN Oscillator can also be used for building your own trading systems. Some example Better TRIN Systems are included in the Better TRIN Indicator Package, available below.
These Better TRIN Systems are very robust, have never been optimized since their release in May 2007 and continue to make new equity highs.
What people are saying about the Better TRIN Indicators
“Congrats on a GREAT website. I am very impressed with the robustness of these systems – thanks! I think you’ve done something really special with these TRIN Systems. I imagine you know of Mark Brown’s Oddball system and derivatives thereof. I think Mark would be impressed – your daily TRIN system is indeed better than Oddball which runs on 60 min bars.” Jeremy L.
“Thanks too for the Better TRIN … a very interesting indicator … I very much appreciate you making it available … its helping me get to grips with the idea of holding trades a bit longer.” Alan B.
“I like what I’ve seen with your daily TRIN – a lot better than anything I’ve come up with.” Steve L.
“I am finding the Better TRIN Oscillator extremely helpful. I am also using your free bond oscillator. I have been very impressed – these are great tools.” Jason E.
“The Better TRIN Oscillator gave a great heads up to what was about to happen! Thanks again.” Thomas K.
“Great site … I’ve been experimenting with the Better TRIN indicator package for a few days now. Excellent work.” Steve C.
“Your Better TRIN indicator is very interesting because it is not price correlated.” Mark J.
“The Better TRIN conveys the same information as the TRIN but in a much more intuitive form. Better TRIN is easier to read and its interpretation more intuitive. And mistakes, which can be fatal, are far less likely.” Bob P.
“I find your insights most interesting and helpful, and also, you make me feel that I’m not alone out here on the trading sea. But, most of all, I simply can’t thank you enough for the Better TRIN, which should be called ‘The Taylor Oscillator’. It is wonderful and it is transforming my trading. There aren’t enough good things that I can tell you about the Taylor Oscillator. I am making money consistently for the first time. I can’t say ‘thank you Barry’ enough.” Robert A.
“I got your Better TRIN a month ago and it’s great. In my three years at this I’ve never really taken the time to learn the TRIN, it always looked too erratic, arbitrary and upside down! It looks like you’ve fixed all that. You’ve got a great website.” Rick J.
“I have found the Better TRIN indicator very useful and I use it every day.” Ching Y.
“I have bought so much crud and been misled by so many and I finally think your tools seem to be practical and valuable and seem to be more my style. Everyone else seems to be charging so much money and I appreciate the fact that so much of your stuff is free or a nominal fee – very refreshing.” David B.
“Not only has the Better TRIN been one of the best indicators I’ve looked at, but for only $70 with a nice follow up email, it seems too good to be true! I’ve found it extremely useful when applied to some of my trend following systems, its addition increased my profit factor and avg $ per trade substantially! So, a personal thanks for building it.”
“Still love the Better TRIN, it is the best thing I’ve found for seeing the real trend.” Robert A.
“I am amazed by the accuracy of the Better TRIN and Better Put Call Ratio Oscillators.” George F.
“Great site, great articles and as for the Better TRIN which I bought a few months ago, great rewards! Thanks very much.” Satej
“Firstly, let me tell you that your indicators have helped me turn my mediocre index futures trading results to consistently profitable levels. I find the Better TRIN Oscillator indispensable for my Emini trading.” Kishen C.
“Better TRIN is a very good and unique indicator.” Wei Y.
“I bought all three of your indicators a few months ago. I really love the better TRIN oscillator, and have programmed a good day trading system for the Emini using it, as well as a good swing trading system. Thanks very much!” Brent McC.
“I looked at the Better TRIN code and I really like what you have done. Well worth the money.” James E.
“I very much like your Better TRIN and am learning the best ways to use your Better Sinewave. Thanks for making them very affordable.” Hal W.
“Great site! Good tools with good explanations. Love the Better TRIN indicator and system. Thanks for making it open code so I can play around with it.” Eric P.
“I use the Better TRIN and Trendline indicators every day. The ‘Better’ isn’t just for Barry Taylor – it’s for an essential indicator improved to convey more actionable information in a clear, concise manner (which is essential for analyzing a volatile market).” Robert T.
“Your Better TRIN System even works on the Dax Futures and if you reverse the rules it works equally well on the Bund Futures – although the TRIN is derived from other markets!” Sigmund H.
“I really love the Better TRIN which now makes sense to me. ” Jason B.
“The Better TRIN indicator and strategies are great! I set them up to mirror yours. The recent short signals were excellent.” Loren
“I have yet to see Barry Taylor put out something that isn’t superior. His Better TRIN swing-trading system makes steady money, is far better than many highly expensive systems and costs about $50.” CCLSYS, moderator Big Mike Trading Forum
“I purchased your Better TRIN indicator a while back and am very impressed to say the least.” Ramon C.
“Having written many complicated strategies of my own, I have to say, the profit factors of the Better TRIN systems are quite amazing, considering the strategy is basically using just one indicator for it’s decision making.” George C.
“I am so amazed by the work you have put into your products, they are so intuitive and easy to use. By 1pm today I had made 6 points with the Better TRIN system.” Joseph N.
“The video instructions were brilliant, and I was up and running in no time.” Sal S.
“You really need to get some kudos for the Better TRIN. I was going to go home short on Wed but because Better TRIN went nuts on the long side I covered and reversed. Thanks again for another 20 points on the Emini.” Andrew O.
The Better TRIN Indicator Package (Intra-day and End-of-day charts)
The 4 Better TRIN indicators shown in the videos and charts above are now available for sale and immediate download. Here’s what you get:
- Better TRIN, an easier-to-interpret version of the classic TRIN indicator
- Better TRIN ShowMe, an indicator that highlights TRIN divergence entry points
- Better TRIN Oscillator, for measuring trend direction and buying / selling strength without the use of price, works on both end-of-day and intra-day charts
- Better TRIN Oscillator ShowMe identifies Oscillator turning points
- 5 Example TRIN Systems for swing trading the Emini using daily bars
- Word document with EasyLanguage code
All indicators are written for use on the TradeStation platform in unprotected / open EasyLanguage code.