Reversal Confirmation

9 thg 12, 2025

Reversal Confirmation (RC)
This indicator identifies potential price reversals using a simple but effective two-candle pattern. It detects when a trend exhausts and confirms the reversal when the next candle eclipses the close of the reversal candle.
How It Works
The indicator uses a two-step process to confirm reversals:

Reversal Candle (R) - The first candle that closes in the opposite direction after a sustained trend. This signals potential exhaustion of the current move.
Confirmation Candle (C) - The candle that eclipses (closes beyond) the close of the reversal candle. This confirms the reversal is underway.

For a bullish reversal, the confirmation candle must close above the close of the reversal candle. For a bearish reversal, the confirmation candle must close below the close of the reversal candle.
Key Features

Requires a significant prior trend before looking for reversals, filtering out choppy sideways markets
Uses ATR to measure move significance, adapting to current volatility
Clean two-candle pattern that's easy to understand and trade
Visual dashed line showing the reversal candle close level that must be eclipsed
Built-in alerts for all signal types

Settings

Trend Lookback - Number of candles to analyze for prior trend detection (default: 7)
Trend Strength - Percentage of lookback candles required in trend direction (default: 0.7 = 70%)
Minimum Move (ATR multiple) - How large the prior move must be before signaling (default: 2.0)
Show Bullish/Bearish - Toggle each signal type on or off
Mark Reversal Candles - Toggle visibility of the reversal candle markers

Visual Signals

"R" with small circle - Marks the reversal candle where the pattern begins
"C" with triangle - Marks the confirmation candle (your entry signal)
Dashed line - Shows the close level of the reversal candle that must be eclipsed

Alerts
Three alert options are available:

Bullish Confirmation
Bearish Confirmation
Any Confirmation

How To Set Up Alerts

Add the indicator to your chart
Right-click on the chart and select "Add Alert" (or press Alt+A)
In the Condition dropdown, select "Reversal Confirmation"
Choose your preferred alert type
Set notification preferences (popup, email, sound, webhook)
Click "Create"

Tips For Best Results

Signals appearing at key support/resistance levels tend to be more reliable
Combine with VWAP, moving averages, or prior day high/low for confluence
Use higher timeframe trend direction as a filter
Increase Minimum Move ATR in volatile conditions to reduce false signals
Adjust Trend Lookback based on your timeframe (higher values for longer timeframes)

The Logic Behind It
After a sustained move in one direction, the first candle to close in the opposite direction signals potential exhaustion. However, one candle alone isn't enough. When the next candle eclipses the close of that reversal candle, it confirms that buyers (or sellers) have truly taken control and the reversal is underway.
Note: This indicator is for informational purposes only and should not be used as the sole basis for trading decisions. Always use proper risk management and consider combining with other forms of analysis.

12 thg 12, 2025

Phát hành các Ghi chú

Reversal Confirmation with EMA Filter

This indicator identifies potential trend reversals by detecting when price action shifts direction after a sustained move, then confirms the reversal with EMA alignment.

HOW IT WORKS

The indicator uses a two-step process:

1. Reversal Candle (R) — Marks the first candle that closes in the opposite direction after a defined trend. The prior trend must meet two criteria: a minimum percentage of candles moving in the same direction (trend strength) and a minimum price displacement measured in ATR multiples.

2. Confirmation Candle (C) — Signals when the next candle eclipses the reversal candle's close AND the fast EMA (3) is properly aligned with the slow EMA (5). Bullish confirmations require the 3 EMA above the 5 EMA. Bearish confirmations require the 3 EMA below the 5 EMA.

The EMA filter helps avoid false signals by ensuring short-term momentum supports the reversal direction.

SETTINGS

Trend Lookback — Number of candles to analyze for prior trend (default: 7)
Trend Strength — Percentage of lookback candles required in trend direction (default: 70%)
Minimum Move (ATR multiple) — Price must move at least this many ATRs before a reversal qualifies (default: 2.0)
Fast/Slow EMA — Lengths for the EMA filter (default: 3 and 5)

USAGE

Look for "C" markers as potential entry signals in the direction of the reversal. The "R" markers show where the reversal candle formed, giving context for the setup. The dashed horizontal line marks the reversal candle's close level — the price that must be eclipsed for confirmation.

Works on any timeframe. Adjust the ATR multiple and trend lookback based on your instrument's volatility and your trading style.

16 thg 12, 2025

Phát hành các Ghi chú

Reversal Confirmation with EMA Filter

This indicator identifies potential trend reversals by detecting when price action shifts direction after a sustained move, then confirms the reversal with EMA alignment. White candles highlight EMA crossovers for quick visual reference.

HOW IT WORKS

The indicator uses a two-step process:

1. Reversal Candle (R) — Marks the first candle that closes in the opposite direction after a defined trend. The prior trend must meet two criteria: a minimum percentage of candles moving in the same direction (trend strength) and a minimum price displacement measured in ATR multiples.

2. Confirmation Candle (C) — Signals when the next candle eclipses the reversal candle's close AND the fast EMA (3) is properly aligned with the slow EMA (5). Bullish confirmations require the 3 EMA above the 5 EMA. Bearish confirmations require the 3 EMA below the 5 EMA.

3. White Candles — Any candle where the 3 EMA crosses above or below the 5 EMA turns white, making momentum shifts easy to spot at a glance.

The EMA filter helps avoid false signals by ensuring short-term momentum supports the reversal direction.

SETTINGS

Trend Lookback — Number of candles to analyze for prior trend (default: 7)
Trend Strength — Percentage of lookback candles required in trend direction (default: 70%)
Minimum Move (ATR multiple) — Price must move at least this many ATRs before a reversal qualifies (default: 2.0)
Fast/Slow EMA — Lengths for the EMA filter (default: 3 and 5)

USAGE

Look for "C" markers as potential entry signals in the direction of the reversal. The "R" markers show where the reversal candle formed, giving context for the setup. The dashed horizontal line marks the reversal candle's close level — the price that must be eclipsed for confirmation. White candles alert you to EMA crossovers, which often precede or coincide with momentum changes.

Works on any timeframe. Adjust the ATR multiple and trend lookback based on your instrument's volatility and your trading style.