Originally published at: Building the SuperTrend Indicator from Scratch in Python | EODHD APIs Academy
I’ve backtested numerous trading strategies using a wide variety of technical indicators. Among these, a few indicators have delivered exceptional results, and I consider them to be “premium” indicators. In today’s analysis, we’ll focus on one such trend-following indicator that has earned its place in this exclusive group due to its accuracy and efficiency—the SuperTrend indicator. We’ll begin by understanding what the SuperTrend indicator is and how its formula works, including its key parameters like volatility and settings for intraday trading. Afterward, we’ll demonstrate how to build the indicator from scratch using Python, step-by-step, and integrate it into a simple trading strategy. Next, we’ll backtest the strategy on Tesla’s stock and analyze its performance against the SPY ETF (an ETF designed to mimic the…
