thinkscript code for McClellan Summation Index and Histogram

The McClellan Summation Index works well to help investors identify important turning points in the market. The Summation Index gives a longer term signal when it confirms, or fails to confirm, the trend in the stock market itself. It can provide an early signal of a trend change too. thinkDesktop offers the Summation Index as a standard study and with some thinkering we have a histogram too.

The chart shows two studies, which can be used separately. The studies are to be used on the daily time frame. Like the standard TOS study NYSE, NASDAQ or AMEX can be selected.

The study on the price chart is a modification of the standard TOS study and prints the Summation Index in white bullets along two simple moving averages, with a length of 5 (green) and 10 (red) respectively. See legend on the chart too. Be sure to hit the tickbox next to show "On upper paragraph".

The lower pane holds the histogram of the Summation Index with the two moving averages. The histogram is positive as long as the Summation Index is above the 10 period MA. A waning downtrend renders the histogram to dark red and a waning uptrend renders the histogram to dark green.

Notice both the Summation Index as well as the histogram can offer divergence signals to price.

The thinkscript code is provided in the comment section for copy/paste.

Enjoy!