Watch video here: https://youtu.be/if6ZKCRu4qI?si=vPRyVrz_4Tewfp6V
The Leaders & Laggers indicator helps you track correlation and relative strength based on cumulative percentage change from the start of the trading session. Here is the indicator showing the relative strength of various futures instruments normalized to the start of the current day’s trading session:
At any given time, a quick glance at this chart can tell you which is the strongest and which is the weakest market and also whether the markets are trending or oscillating. Anything above the Zeroline is up for the day. Anything below the Zeroline is down on the day. And of course this can change throughout the day. Fitting this correlation graph into your workspace can help you keep on top of market conditions.
If you have a long bias, it makes sense to trade the strongest market. With a short bias, trading the weakest market might be best. The following image shows a day where the indices and crude were selling with gold holding steady:
If you were trading the equity indices, RTY would be a good choice for going short. If you were looking for a reversal of the selloff, YM being the strongest might make more sense at that moment. Later in the day the picture could be quite different so its a good idea to check this graphic periodically.
Another way Leaders and Laggers can help is to keep you out of the market when there is no clear direction:
There is no clear direction here so it may be better to wait until a direction is established.
You can correlate up to 15 instruments simultaneously, display an info box showing the strongest and weakest market, and customize the starting point for the percent change calculation (default is session start).
You can download the zip file (see link below) so you can import the software directly into the Tickblaze platform to use in your trading. If you want to access the source code, you can find everything you need here:
https://github.com/Tickblaze/Tickblaze.Scripts.ARC.
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