Consecutive Candle Signals Filtered by Stochastic Levels

Summary

This indicator looks for sequences of candles with configurable minimum body sizes and applies a stochastic filter to the first candle. The description associates consecutive High candles with a stochastic reading at or below the oversold level, and consecutive Low candles with a reading at or above the overbought level. The next candle must also meet its body-size condition, but does not need to satisfy the stochastic filter. When the described conditions are met, the indicator can alert and draw an arrow; options cover candle counts, arrow styles, notifications, and stochastic settings.

The document frames arrow interpretation around two styles: trend trading, which anticipates continuation, and range trading, which anticipates reversal. This makes the same setup open to different interpretations. No market, timeframe, validation results, or risk rules are provided, and the text does not establish that either interpretation is profitable.

Key ideas

• The indicator screens candle sequences using adjustable minimum body sizes.
• A stochastic threshold is applied to the first candle in the sequence.
• The following candle must meet its body-size condition but is not filtered by stochastic.
• Alerts and chart arrows can be configured, including for trend or range interpretations.
• The document provides no backtest results or risk-management rules.

Tags

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