DeMark Setup Signals from Consecutive Price Comparisons

Summary

This indicator adapts a DeMark Setup concept to flag possible minor price reversals. For a configurable length, it compares each source-price value with the value the same number of bars earlier. It classifies the setup as bullish when all comparisons show declines, bearish when all show rises, and neutral otherwise; changes in that classification produce buy or sell signals. The example defaults to a length of four and can use different price sources and resolutions.

The document describes the indicator as producing more frequent reversal signals than a related reversal-points script, while acknowledging that some signals fail. It supplies charting and strategy-entry logic, but no measured results or performance statistics. The repainting and bar-color options affect how source data is selected, so users should understand those settings when evaluating historical signals. The indicator is presented as one component of a larger DeMark Sequential approach, not a complete, validated trading system.

Key ideas

• The indicator compares source prices with values a configurable number of bars earlier.
• A run of declines or rises across the comparison window sets a bullish or bearish setup state.
• Signals occur when the setup state crosses from neutral into bullish or bearish territory.
• The length, price source, resolution, repainting, and bar-color behavior are configurable.
• The document gives no measured performance evidence and notes that some reversal signals fail.

Tags

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