//@version=6
strategy("Versatile Bear Market Short Strategy - V6 (Manual ADX)", overlay=true, initial_capital=10000, currency=currency.USD, default_qty_type=strategy.percent_of_equity, default_qty_value=10)

// === INPUTS ===
// Trend Confirmation: Simple Moving Average
smaPeriod = input.int(title="SMA Period", defval=50, minval=1)

// Overbought Condition: RSI Parameters
rsiPeriod     = input.int(title="RSI Period", defval=14, minval=1)
rsiOverbought = input.int(title="RSI Overbought Level", defval=60, minval=1, maxval=100)

// MACD Parameters
macdFast   = input.int(title="MACD Fast Length", defval=12, minval=1)
macdSlow   = input.int(title="MACD Slow Length", defval=26, minval=1)
macdSignal = input.int(title="MACD Signal Length", defval=9, minval=1)

// Bollinger Bands Parameters
bbLength = input.int(title="Bollinger Bands Length", defval=20, minval=1)
bbStdDev = input.float(title="BB StdDev Multiplier", defval=2.0, step=0.1)

// Stochastic Oscillator Parameters
stochLength     = input.int(title="Stochastic %K Length", defval=14, minval=1)
stochSmooth     = input.int(title="Stochastic %D Smoothing", defval=3, minval=1)
stochOverbought = input.int(title="Stochastic Overbought Level", defval=80, minval=1, maxval=100)

// ADX Parameters (Manual Calculation)
adxPeriod    = input.int(title="ADX Period", defval=14, minval=1)
adxThreshold = input.float(title="ADX Trend Strength Threshold", defval=25.0, step=0.1)

// Risk Management
stopLossPercent   = input.float(title="Stop Loss (%)", defval=0.5, step=0.1)
takeProfitPercent = input.float(title="Take Profit (%)", defval=0.3, step=0.1)


// === INDICATOR CALCULATIONS ===

// 1. SMA for trend confirmation; price below this confirms a bearish market.
smaValue = ta.sma(close, smaPeriod)

// 2. RSI to check for overbought conditions.
rsiValue = ta.rsi(close, rsiPeriod)

// 3. MACD to catch momentum shifts.
[macdLine, signalLine, _] = ta.macd(close, macdFast, macdSlow, macdSignal)

// 4. Bollinger Bands to identify potential exhaustion in rallies.
bbBasis = ta.sma(close, bbLength)
bbDev   = bbStdDev * ta.stdev(close, bbLength)
bbUpper = bbBasis + bbDev
bbLower = bbBasis - bbDev

// 5. Stochastic Oscillator (using %K) for additional overbought signals.
k = ta.stoch(close, high, low, stochLength)
d = ta.sma(k, stochSmooth)


// === MANUAL ADX CALCULATION ===
// Step 1: Calculate the True Range (TR)
prevClose = nz(close[1], close)
tr = math.max(high - low, math.max(math.abs(high - prevClose), math.abs(low - prevClose)))

// Step 2: Calculate directional movements (DM)
upMove   = high - nz(high[1])
downMove = nz(low[1]) - low
plusDM  = (upMove > downMove and upMove > 0) ? upMove : 0
minusDM = (downMove > upMove and downMove > 0) ? downMove : 0

// Step 3: Smooth the values using Wilder's RMA (smoothed moving average)
atr       = ta.rma(tr, adxPeriod)
smPlusDM  = ta.rma(plusDM, adxPeriod)
smMinusDM = ta.rma(minusDM, adxPeriod)

// Step 4: Calculate the Directional Indicators (DI+ and DI-)
plusDI  = 100 * (smPlusDM / atr)
minusDI = 100 * (smMinusDM / atr)

// Step 5: Compute the Directional Index (DX)
dx = 100 * math.abs(plusDI - minusDI) / (plusDI + minusDI)

// Step 6: Smooth DX to get ADX
adxValue = ta.rma(dx, adxPeriod)


// === ENTRY CONDITIONS FOR A SHORT POSITION ===

// Condition 1: Bear Trend Confirmation - Price is below the SMA.
bearTrend = close < smaValue

// Condition 2: Bollinger Bands - Price crosses under the upper band.
bbCondition = ta.crossunder(close, bbUpper)

// Condition 3: MACD - MACD line crosses below the signal line.
macdCondition = ta.crossunder(macdLine, signalLine)

// Condition 4: RSI - Check if RSI is overbought.
rsiCondition = rsiValue > rsiOverbought

// Condition 5: Stochastic - %K crosses under the overbought threshold.
stochCondition = ta.crossunder(k, stochOverbought)

// Condition 6: ADX - The market must have a strong trend.
adxCondition = adxValue > adxThreshold

// Combine all conditions for a short entry signal.
shortEntryCondition = bearTrend and bbCondition and macdCondition and rsiCondition and stochCondition and adxCondition

if shortEntryCondition
    strategy.entry("Short", strategy.short)


// === EXIT CONDITIONS ===

// For open short positions, define a stop loss above and a take profit below the entry price.
if strategy.position_size < 0
    entryPrice = strategy.position_avg_price
    stopPrice  = entryPrice * (1 + stopLossPercent / 100)
    targetPrice = entryPrice * (1 - takeProfitPercent / 100)
    strategy.exit("Exit Short", from_entry="Short", stop=stopPrice, limit=targetPrice)


// === PLOTTING ===
plot(smaValue, color=color.orange, title="SMA")
plot(bbUpper, color=color.blue, title="Bollinger Upper")
plot(bbBasis, color=color.gray, title="Bollinger Basis")
plot(bbLower, color=color.blue, title="Bollinger Lower")

// Optional: Plot the manually calculated ADX.
plot(adxValue, title="ADX", color=color.fuchsia)