Candle Matrix [CryptoScripts]

█ OVERVIEW

Candle Matrix is an all-in-one technical analysis indicator designed to identify high-probability reversal zones and trend exhaustion points across any market and timeframe. It combines multiple analytical approaches into a single, clean overlay that helps traders spot potential turning points before they happen.


█ FEATURES

◆ DYNAMIC BAR COLORING
Bars are colored on a spectrum from red to purple based on the underlying exhaustion conditions across multiple lookback periods. This gives you an instant visual read on whether buying or selling pressure is dominant — without cluttering your chart with extra panels.

🔴 Red/Orange tones → Indicates overbought territory and a pullback is likely
🟢 Purple/Dark Blue tones → Indicates oversold territory and a bounce is likely


◆ ADAPTIVE VOLATILITY BANDS
Six bands automatically adjust to current market volatility, creating dynamic support and resistance zones. Price reaching the outer bands often signals overextension and potential mean reversion opportunities.

• Upper bands (red) → Potential resistance / overbought zones
• Lower bands (green) → Potential support / oversold zones


◆ TREND-AWARE MOVING AVERAGE
A moving average that changes color based on trend strength and direction:

🟢 Green → Strong bullish trend
🔴 Red → Strong bearish trend
⚫ Black → Consolidation / low momentum


◆ EXHAUSTION SIGNALS (TP Labels)
"TP" labels appear when price action suggests a trend may be losing steam. These are designed to alert you to potential take-profit zones or areas where a reversal could begin.

🟢 Green TP below bar → Bullish exhaustion count reached
🔴 Red TP above bar → Bearish exhaustion count reached


◆ MULTI-INDICATOR DIVERGENCE DETECTION
The indicator scans for divergences across numerous oscillators simultaneously. When multiple indicators agree that price and momentum are diverging, a numbered label appears showing the divergence strength.

🔵 Teal labels (below bar) → Regular bullish divergence
🔴 Red labels (above bar) → Regular bearish divergence
🟢 Green labels (below bar) → Hidden bullish divergence
🟠 Orange labels (above bar) → Hidden bearish divergence

The number displayed (2-8+) represents how many indicators are confirming the divergence — higher numbers suggest stronger signals.


◆ MEAN REVERSION SIGNALS (X Markers)
The most selective signals on the indicator. These X markers only appear when multiple strict conditions align, suggesting an extreme move that may be due for a snapback.

🟢 Green X below bar → Potential bullish reversal zone
🔴 Red X above bar → Potential bearish reversal zone


█ HOW TO USE

1. TREND IDENTIFICATION — Use bar colors and the adaptive MA to quickly assess the current trend direction and strength.

2. KEY LEVELS — Watch for price interaction with the volatility bands, especially the outer bands which often act as reversal zones.

3. EXHAUSTION WARNINGS — When TP labels appear after an extended move, consider tightening stops or taking partial profits.

4. DIVERGENCE CONFIRMATION — Higher divergence counts (4+) provide stronger evidence of a potential reversal. Use these in confluence with other signals.

5. HIGH-CONVICTION REVERSALS — The X markers represent the highest-conviction mean reversion setups. These are rare but powerful when they appear at key levels.


█ SETTINGS

The indicator is highly customizable:

• Adjust the MA type and smoothing periods for bar coloring
• Modify volatility band multipliers to suit different assets
• Toggle individual divergence indicators on/off
• Set minimum divergence count threshold
• Customize all colors to match your chart theme


█ NOTES

• Works on all markets: Crypto, Forex, Stocks, Futures, Indices
• Works on all timeframes — adjust settings for your preferred trading style
• Best used in confluence with price action and key support/resistance levels
• No indicator is perfect — always use proper risk management


█ CREDITS

Developed by CryptoScripts