ALMA Trend Confirmation with Risk-Based Target Projections

Summary

This indicator identifies directional trend changes using an Arnaud Legoux moving average (ALMA), price deviation bands, and an ATR-normalized slope. A bullish state begins when the slope exceeds a positive threshold and price closes above the upper confirmation band; the bearish condition mirrors this below the lower band. The trend state persists until the opposite setup appears. Ribbon shading and candle colors express trend direction and a conviction score derived from normalized slope and price distance from ALMA.

At each trend flip, the indicator plots an entry reference, a stop based on recent swing structure subject to minimum and maximum ATR distances, and a series of profit levels expressed as multiples of that risk. It visually marks target approaches and hits and retains a limited history of positions. These are charting aids and trend signals, not trade executions or proof of profitability. The supplied code excerpt is incomplete and gives no backtest, instrument-specific evaluation, or evidence that the plotted targets predict outcomes.

Key ideas

• Trend direction changes when ALMA slope and price relative to deviation bands confirm the same direction.
• ATR normalization helps compare slope strength and calculate stop distances across changing volatility.
• The ribbon and candle coloring visually represent trend direction and a conviction measure.
• Stops use recent swing structure while enforcing configurable ATR distance bounds.
• Profit levels are plotted as multiples of risk, but the indicator provides no evidence of predictive performance.

Tags

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