A Daily Crypto Trend Indicator Based on Higher Highs and Higher Lows

Summary

This document develops a daily trend indicator for crypto markets using the sequence of candle highs and lows. It classifies a bullish trend when both rise across consecutive days and a bearish trend when both fall. The process uses only completed daily candles to avoid acting on incomplete current-day data, and requires three days of confirmation before recording a trend. It tracks trend duration and estimates returns from the trend’s starting open to its ending close.

The author reports historical results for BTC, ETH, and BNB over a period beginning in 2020 and ending in 2025, including recent trend-cycle examples and summary averages. These examples illustrate varying outcomes, including a nominal bullish ETH period with a slightly negative return. The results are descriptive rather than evidence of a tradable edge: the document does not provide a complete evaluation of fees, slippage, position rules, or out-of-sample performance. It also acknowledges delayed signals, confusing behavior in sideways markets, and the limits of using price structure alone without volume or other context.

Key ideas

• A bullish sequence requires daily highs and lows to rise together, while a bearish sequence requires both to fall.
• The method analyzes completed daily candles and requires three consecutive days for confirmation.
• Trend returns are measured from the starting candle’s open to the ending candle’s close.
• The document reports historical examples for BTC, ETH, and BNB, but does not establish performance after trading costs.
• The indicator can lag and may give confusing signals in sideways markets.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.