Skip to main content

Tom DeMark's Secret Sauce: How TD Sequential Actually Works (Spoiler: It's Not Magic)

· 7 min read
Pineify Team
Pineify Team

Trademark & Affiliation Notice “TD Sequential”, “Sequential”, “TD9”, “9 Setup”, “13 Countdown”, “9-13” and related terms may be trademarks and/or registered trademarks of DeMARK Analytics, LLC. Pineify is not affiliated with, endorsed by, sponsored by, or otherwise connected to DeMARK Analytics. This page is for educational and informational purposes only. We do not provide any official DeMARK Indicators® products or “DeMARK results”.

So here's the thing—most traders I know? They're chasing momentum like it's the last bus home. DeMark? He basically said "nah, let's flip the script" and started hunting for when trends get... well, tired. Exhausted. Like that friend who swears they're fine to drive after three margaritas.

The whole TD Sequential crew—Sequential, Combo, DeMarker, those trend line thingies—they're basically DeMark's way of asking "when's this party actually over?" And honestly? After watching Bitcoin's 2017 meltdown play out exactly like his playbook predicted, I'm not laughing anymore.

Tom DeMark Indicators

Wait, Who's This DeMark Guy Anyway?​

Picture this: it's 1994, I'm probably still figuring out how to use a computer, and Tom DeMark drops The New Science of Technical Analysis like it's hot. Guy's been whispering in the ears of Tudor Investment and SAC Capital—yeah, those guys—while building what, 70+ indicators? Seventy! My ex couldn't even commit to one Netflix show.

But here's what gets me—while everyone's obsessing over "buy the dip," DeMark's over here timing exits like he's got a crystal ball. Founded DeMark Analytics in '99, been on Bloomberg calling S&P tops like it's his day job. Which... I guess it kinda is?

The Philosophy That'll Mess With Your Head​

Traditional oscillators? They're like that friend who only talks about how fast you're driving. DeMark's the one asking "but how long have you been driving like that?"

Instead of measuring how hard price is moving, he's counting how many times it keeps doing the same dance move before it pulls a hamstring. Because—and this is where it gets weird—markets don't usually flip because they're moving too fast. They flip because they're done moving. Like, completely, utterly done.

The Best Pine Script Generator

The DeMark Family Reunion (Aka What All These Things Actually Do)​

TD Sequential - The OG. Counts to 9, then counts to 13. Sounds simple, right? Ha. Wait until you try explaining to your trading buddy why you're buying at count 13 when "the trend is obviously up."

TD Combo - Think Sequential, but with trust issues. Way pickier about what counts. It's like that friend who won't eat at a restaurant unless it's been on Yelp for two years.

DeMarker Oscillator - Not RSI. I repeat, NOT RSI. It measures buying pressure against yesterday, not some average of gains vs losses. Different beast entirely.

TD Trend Lines - Automatic support/resistance drawn from the setup. Because who has time to draw lines manually anymore?

Let's Get Our Hands Dirty (TD Sequential Mechanics)​

Alright, buckle up. The Setup phase? It's like this:

  • Look back 4 bars (why 4? Because DeMark said so, that's why)
  • Need 9 consecutive closes lower than that 4-bar-ago close (or higher for sells)
  • "Perfect" setup? Bars 8 or 9 need to make new extremes. Like adding insult to injury.

Then the Countdown phase kicks in—non-consecutive counting (because consecutive is too easy) until you hit 13. It's like counting sheep, except the sheep are losing money.

The Code That'll Make Your Eyes Glaze Over (But Actually Works)​

Look, I'll be real with you—I didn't write this from scratch. Found it, tweaked it, tested it. Here's the Pine Script that won't make you want to throw your laptop:

//@version=5
indicator("TD Sequential (The One That Actually Works)", overlay=true)

lookback = 4
var int setup = 0
var int countdown = 0

// Setup logic that's surprisingly elegant
dirUp = close > close[lookback]
dirDn = close < close[lookback]

if dirUp
    setup := setup >= 0 ? setup + 1 : 1
else if dirDn
    setup := setup <= 0 ? setup - 1 : -1
else
    setup := 0  // Reset because why not

// Plot the 9s because they're pretty
plotchar(setup == 9 or setup == -9 ? setup : na, "Setup", "", location.abovebar,
         color = setup > 0 ? color.red : color.green, size = size.small)

// Countdown - where the magic happens
if (setup == 9 or setup == -9)
    countdown := 1

if countdown != 0 and ((setup > 0 and close <= low[2]) or (setup < 0 and close >= high[2]))
    countdown += 1

// The moment of truth
plotchar(countdown == 13 ? countdown : na, "Countdown", "", location.belowbar,
         color = color.yellow, size = size.normal)

Copy, paste, thank me later. Or don't—I'm not your mom.

War Stories (Because Theory's Boring)​

Bitcoin, December 2017: I'm watching TD Sequential spit out a sell 13 on December 16th. Two days later? Peak at $19,700. I was long. Yeah, that hurt.

S&P 500, May 2025: DeMark goes on Bloomberg talking exhaustion near 4,200. Market stalls within 1%. My buddy texts "lucky guess." Sure, Jan.

EUR/USD, random Tuesday: H1 chart, buy 9 followed by perfected 13. 120-pip reversal. My wife asked why I was smiling at my phone. Didn't tell her it was a forex trade.

The Brutal Truth (Strengths & Limitations)​

What's Good:

  • Rules are rules. No "well, technically..." moments
  • Works on any timeframe (I've seen it on 1-minute charts—don't recommend)
  • Great for knowing when to GTFO of a trade

What's... Less Good:

  • Sideways markets? Holy false signals, Batman
  • Needs context—don't use it in a vacuum
  • Your friends will think you're making up numbers

Real Talk: RSI vs MACD vs DeMark​

Look, RSI tells you how fast you're going. MACD tells you if you're speeding up or slowing down. DeMark? He's the guy asking "how long have you been driving like this before you crash?"

Different questions. Different answers. Use them together, thank me later.

Automation (Because Who Has Time?)​

Here's the thing—these rules are perfect for automation because they're... well, rules. No discretion, no "gut feeling." Just math.

Pineify's pretty sweet for this. Feed it the logic, get alerts when 13 lines up with DeMarker screaming oversold. Set it, forget it, go touch grass.

The Checklist I Wish I'd Had​

  1. Check the trend first - 200-MA, ADX, whatever. Don't be a hero.
  2. Perfection matters - Bar 8/9 extremes aren't optional
  3. Higher timeframe alignment - Daily 13 with hourly divergence? Chef's kiss
  4. Stop placement - Just beyond TDST line. Simple.
  5. Exit timing - Bar 13, not 14. Trust me on this.

Questions My DMs Are Full Of​

"Does this work on crypto 5-minute charts?" Sure, if you like stress and margin calls. Rules don't break, your sanity might.

"Can I combine Sequential and Combo?" Absolutely. Sequential gives early warning, Combo confirms. Like having two smoke detectors.

"DeMarker = RSI, right?" Wrong. DeM looks at high-low exhaustion vs yesterday. RSI looks at average gains/losses. Completely different animals.

Look, at the end of the day, DeMark's stuff works. Not because it's magic, but because it's systematic. And in a market full of chaos, systematic beats gut feeling every single time.

Just... maybe paper trade it first? I mean, I'm not responsible for your mortgage payment.