A Twist Trend Indicator Combining STE with a Three-Bar Trailing Stop

Summary

The document presents a custom trend indicator that combines STE with a three-bar trailing stop associated with Larry Williams. Its stated aim is to anticipate directional changes and make larger trends easier to follow than with the author's earlier trailing-stop approach. The supplied procedure looks for inside bars while building a multi-bar range, then uses breaks beyond the prior range to switch a reference level between the range low and high. STE is applied to that reference to produce the Twist value.

The author describes using a period of 15, looking for Twist above 38 in the trailing-stop direction, tracking positions on a five-minute timeframe, and adding to positions on pullbacks. These are presented as personal trading rules and an anecdotal report of better entries on an hourly timeframe. The document provides no backtest, market-specific performance evidence, risk controls, or detailed handling of ambiguous signals. The stated setup should therefore be treated as an indicator idea rather than a demonstrated strategy.

Key ideas

• The indicator combines STE with a three-bar trailing-stop concept to identify trend direction.
• It builds a range while accounting for inside bars and changes its reference level after a range break.
• The author describes using a period of 15 and a threshold above 38 in the trailing-stop direction.
• The proposed workflow tracks positions on a five-minute timeframe and adds on pullbacks.
• The claimed improvement is anecdotal, with no backtest evidence or risk-control details provided.

Tags

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