Finding Local Highs and Lows by Comparing Neighboring Candles

Summary

The document describes a simple way to mark local price extremes. For each candle, it compares that candle’s high with the highs of candles on its left and right; it applies the same neighbor comparison to the low. An arrow is plotted when the candle meets the stated comparison rule, identifying a potential turning point in the price series.

This is a basic technical analysis concept rather than a complete trading strategy. The document gives no lookback settings, performance evidence, or instructions for using the plotted points in entries, exits, or risk controls. Its wording also does not fully specify whether the candidate must exceed both neighboring highs or only one, so the precise detection rule would need clarification before implementation. A local extreme can help describe past price action, but the document does not establish that it predicts future movement.

Key ideas

• Local highs are identified by comparing a candle’s high with highs on either side.
• Local lows are identified using the corresponding comparison of lows.
• The indicator plots arrows to mark candles that meet its local-extreme rule.
• The document provides no tested trading rules or performance evidence.

Tags

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