Combining Swing Structure, Fibonacci Zones, and Engulfing Signals
Summary
This overlay indicator combines ATR-filtered pivot detection with market-structure labels, Fibonacci retracements, engulfing candles, and a weighted confluence score. Confirmed swing highs and lows are classified as higher highs, higher lows, lower highs, or lower lows. A close beyond a recent swing level is marked as a continuation break (BOS) or a character change (CHoCH), depending on the existing trend. After a break, Fibonacci levels are anchored to the active swing range, with the edge in the direction of the move able to trail until a pivot confirms.
The indicator scores proximity to Fibonacci and swing levels, emphasizing the 0.500 and 0.618 retracements. It filters engulfing patterns by premium or discount context and uses structural bias and confluence to produce buy or sell signals; CHoCH can also trigger a signal. A cooldown aims to reduce clustered signals, and boolean outputs support alerts. The document describes implementation settings and logic, but provides no performance tests. Pivot confirmation depends on future bars in the lookback window, and the proposed signals should not be taken as evidence of predictive value.
Key ideas
- ATR filtering removes pivots whose swing size is below a configurable threshold.
- Swing sequences classify structure, while breaks become BOS or CHoCH according to trend context.
- Fibonacci retracements and extensions are anchored to the active swing range after a structural break.
- Confluence scores combine proximity to swing levels and Fibonacci levels, with greater weight on selected retracements.
- Engulfing patterns are conditioned on structural context, and signals may also follow a CHoCH.
- The document describes indicator mechanics but supplies no evidence of trading performance.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.