Dekidaka-Ashi: Scaling Candle Bodies with Relative Volume
Summary
Dekidaka-Ashi overlays a modified candle outline on a standard price chart to show volume alongside open, high, low, and close. It scales the distance between the candle’s open and close by a smoothed volume ratio: current smoothed volume divided by the sum of current and prior smoothed volume. The resulting amount extends the candle body above and below its open-close range. A body-size input adjusts the extension, while volume smoothing changes how visibly the bodies vary.
The indicator also provides upper and lower levels that can be averaged into bands, and optional signals based on price crossing those levels and candle direction. The author describes the signals as simple breakout rules and notes that volatile moves may rarely trigger them, with more signals occurring during quieter periods. No performance study is provided, and the author expresses uncertainty about signal accuracy. The volume-scaled display and derived bands are visualization tools; their usefulness as trading rules requires independent testing.
Key ideas
- The indicator scales candle-body extensions using a ratio of current smoothed volume to current plus prior smoothed volume.
- A body-size control changes the extension amplitude, and volume smoothing changes the appearance of the display.
- Moving averages of the upper and lower levels can be used to construct bands.
- Optional signals combine crossings of the levels with candle direction, but their accuracy is unvalidated.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.