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U.S Recession Probabilities Indicator for ThinkorSwim

The Smoothed U.S. Recession Probabilities indicator measures the likelihood that the U.S. economy will experience a recession soon.

The indicator is calculated using data from four concurrent monthly reports.

  • Non-farm payroll employment.
  • The index of industrial production.
  • Real personal income excluding transfer payments.
  • Real manufacturing and trade sales.

In ThinkorSwim, you can analyze and view the U.S Recession Probabilities chart by entering the ticker symbol RECPROUSM156N.

I created a simplified version of the chart as a standalone indicator to make it easier to compare the recession data to the S&P 500 Index.

U.S. Recession Probabilities Indicator for ThinkorSwim

# Indicator Name: Smoothed U.S. Recession Probabilities (RECPROUSM156N)
# Version: 1.0.0
# Developer: Melvin C.
# URL: https://thinkscript101.com/us-recession-probabilities-indicator-thinkorswim/

declare lower;
plot Data = close("RECPROUSM156N:FRED");
plot High_Recession = 100;
plot Low_Recession = 0;


  1. Import the code above into ThinkorSwim.
  2. Set your chart to the monthly (Mo) timeframe.
  3. View the data along with the S&P 500 Index (SPY).

Similar to the RSI, which calculates overbought and oversold levels from 0-100, the Smoothed Recession indicator also operates similarly.

  • A reading of 100 signals a recession is imminent or already happening.
  • A reading at or close to 0 indicates no sign of recession.

The Smoothed U.S. Recession Probabilities indicator is now at a low level (1.22), indicating that there is little probability of a recession coming soon.

However, the indicator does not update in real-time because the economic data it uses only comes out once a month.


Historically, when the indicator displays three consecutive months of smoothed probabilities above 80%, it usually implies the beginning of a new recession.

In contrast, similar periods with probabilities below 20% have consistently served as a solid signal of asset appreciation.

I recommend this page for additional reading on the indicator.

Happy trading!

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