Chaikin Oscillator (Chaikin Osc) - Built-in Indicator Guide

Computes the difference between fast and slow EMAs of the cumulative money flow volume (Accumulation/Distribution Line).

Overview

The Chaikin Oscillator is a volume-based oscillator built from the Accumulation/Distribution Line (ADL). It first forms the Money Flow Volume (MFV) for each bar, cumulates it into the ADL, then subtracts a slow exponential moving average of the ADL from a fast exponential moving average of the ADL. The result is shown as a single red line.

The gray horizontal zero line is drawn by the indicator and acts as a reference. The fast and slow EMA lengths are configurable through the settings panel generated by the parameter decorators. The indicator is meant to be read as a measure of how the volume-weighted price flow is changing relative to its slower trend.

How it works

1. For each bar, calculate Money Flow Volume (Mfv.new()), which weights volume by the close position inside the bar’s high-low range.
2. Keep a running cumulative sum of that series with CumSum.new(Mfv.new()); this is the Accumulation/Distribution Line (ad).
3. Create a fast EMA of ad using fast_length.
4. Create a slow EMA of ad using slow_length.
5. Read the current bar’s values from both EMA series using [0].
6. Subtract the slow EMA from the fast EMA to obtain ch_osc, and return that value for plotting.

Mathematical model

Logic flow

flowchart TD
A["On new bar"] --> B["Compute money flow volume"]
B --> C["Update cumulative ADL state"]
C --> D["Update fast EMA of ADL"]
C --> E["Update slow EMA of ADL"]
D --> F["Value = fast EMA - slow EMA"]
E --> F
F --> G["Plot red line"]

Parameters

Code walkthrough

Indicator declaration and decorators

Lines 6-10 of Chaikin Oscillator.indie5:

@indicator('Chaikin Osc', format=format.VOLUME)  # Chaikin Oscillator
@param.int('fast_length', default=3, min=1, title='Fast Length')
@param.int('slow_length', default=10, min=1, title='Slow Length')
@level(0, line_color=color.GRAY, title='Zero')
@plot.line(color=color.RED, title='Chaikin Oscillator')

The @indicator decorator registers the plot under the short name Chaikin Osc and selects volume formatting. The two @param.int decorators create settings inputs with defaults of 3 and 10. @level(0, ...) draws a gray zero line, and @plot.line(...) colors the returned series red.

Building the Accumulation/Distribution Line

Lines 12-12 of Chaikin Oscillator.indie5:

    ad = CumSum.new(Mfv.new())

Mfv.new() produces the money-flow-volume value for the current bar. Wrapping it with CumSum.new() creates a stateful running total, so ad holds the cumulative sum of all money-flow volumes up to the current bar. This is the underlying series used by the oscillator.

Computing the oscillator

Lines 13-13 of Chaikin Oscillator.indie5:

    ch_osc = Ema.new(ad, fast_length)[0] - Ema.new(ad, slow_length)[0]

Two EMAs of ad are created, one for fast_length and one for slow_length. The [0] index reads the current bar’s value from each EMA series. ch_osc is their difference and becomes the single returned value that is plotted.

Reading the chart

• The red line is the oscillator value (ch_osc) on each bar.
• The gray horizontal line is the zero reference added by @level(0, ...).
• Values above zero occur when the fast EMA of the ADL is above the slow EMA; values below zero occur when the fast EMA is below the slow EMA.
• The distance between the red line and zero reflects the magnitude of the difference between the two EMAs.

Implementation notes

• CumSum.new() and Ema.new() create stateful algorithm objects; Main itself does not store previous-bar values.
• Using [0] reads the current bar from each series. [1] would access the previous bar, but it is not used here.
• There is no built-in constraint requiring slow_length > fast_length; both parameters only have min=1. The subtraction order stays as written.
• format.VOLUME affects how the returned value is scaled on the chart but not the calculation.

FAQ

What is the difference between the two length parameters?

fast_length and slow_length are the periods of two exponential moving averages applied to the cumulative money-flow-volume line. The oscillator subtracts the slow EMA from the fast EMA, so the two lengths determine how quickly the line responds.

How is the zero level used?

The @level(0, ...) decorator draws a gray horizontal line at zero on the same scale. The oscillator is positive when the fast EMA is above the slow EMA and negative when it is below.

Can I change the line color or format?

Yes. The @plot.line(color=...) decorator controls the line color, and format=format.VOLUME in @indicator controls the display format. Changing these decorators adjusts chart presentation only, not the calculation.

Full source code

Indie Script v5, the built-in indicator as shipped with TakeProfit. Add it from the indicators menu or copy the code into the platform’s script editor.

# indie:lang_version = 5
from indie import indicator, format, param, level, color, plot
from indie.algorithms import CumSum, Mfv, Ema


@indicator('Chaikin Osc', format=format.VOLUME)  # Chaikin Oscillator
@param.int('fast_length', default=3, min=1, title='Fast Length')
@param.int('slow_length', default=10, min=1, title='Slow Length')
@level(0, line_color=color.GRAY, title='Zero')
@plot.line(color=color.RED, title='Chaikin Oscillator')
def Main(self, fast_length, slow_length):
    ad = CumSum.new(Mfv.new())
    ch_osc = Ema.new(ad, fast_length)[0] - Ema.new(ad, slow_length)[0]
    return ch_osc