Fibonacci ATR Bands for Trend Context and Sweep Signals

Summary

The indicator places three volatility-scaled bands above and below a smoothed moving average. Band distances use ATR multiplied by Fibonacci-related factors, with the center average providing trend context. The article describes the zones between the middle and outer bands as areas of stretched price and outlines pivot-based sweep signals: a move beyond an outer band followed by a reversal across the prior bar’s extreme can mark a possible stop run. It also explains how the center-line slope is used to project band levels forward.

Suggested settings cover the moving-average period, band width, ratios, ATR smoothing, and projection length. The article recommends adding filters such as volume, candle patterns, or market structure because choppy markets can produce false signals. It provides indicator code and configuration guidance, but no backtest, market-specific results, or evidence that the sweep markers identify profitable reversals. Forward projections are based on a recent average-line slope and should be treated as illustrative levels rather than reliable forecasts.

Key ideas

• The indicator centers volatility-scaled bands on a smoothed moving average.
• ATR multiples set the distances to three Fibonacci-related band levels.
• Pivot moves beyond an outer band followed by a reversal are marked as potential sweep signals.
• A recent moving-average slope projects the bands forward as possible reference levels.
• The article warns of whipsaws and provides no performance testing for the signals.

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