ATR-Filtered Order Block Retests with Confirmation Breakouts
Summary
This strategy identifies potential bullish and bearish order blocks from a candle three bars earlier. It requires the candidate candle to have a minimum body relative to ATR and subsequent price movement to exceed an ATR-based impulse threshold. The candle’s high and low define a zone that remains active for a configurable period, unless price invalidates it by closing beyond the relevant boundary.
A return to an unused zone arms one pending setup. The script waits until after the touch bar, then places a stop entry beyond the zone by a configurable confirmation distance. Setups expire after a limited number of bars, and each zone can be used once. Trades exit through fixed point-based take-profit and stop-loss orders. The document gives default script inputs and a separate tested configuration, but provides no performance statistics or independent validation. Results may differ with market, timeframe, commissions, slippage, and order-fill assumptions; the author recommends realistic backtesting before live use.
Key ideas
- Order block candidates are filtered by candle body size and subsequent impulse relative to ATR.
- A retest arms a directional setup, with entry requiring a later break beyond a configurable confirmation level.
- Zones and pending setups expire, and a zone is marked used after its trade is opened.
- Trades use fixed point-based take-profit and stop-loss levels, whose suitability depends on the instrument and its price scale.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.