Fractal Breakouts Filtered by Recent Swing Highs and Lows

Summary

This script identifies local highs and lows using a configurable fractal window; its default setting marks a five-bar pattern. It stores the three most recent detected highs and lows, computes their respective averages, and uses the newest fractal level as a breakout reference. A long signal occurs when price crosses above the latest fractal high while also being above the average of the stored highs. A short signal applies the inverse conditions to the latest low and the average lows.

The document supplies rules and chart annotations, but no backtest, market, timeframe, transaction-cost assumptions, or evidence of returns. Fractal points require bars on both sides of the candidate, so signals are only knowable after the pattern has formed; the text does not discuss timing or execution implications. The script also provides alerts and plots the average levels, but includes no explicit stop, target, position-sizing rule, or separate risk control. Results would need to be tested with realistic execution assumptions before drawing conclusions.

Key ideas

• The script detects local turning points over a configurable fractal window.
• It retains three recent highs and lows and averages each group as a trend filter.
• Longs require a close crossing above the latest fractal high and above the high average.
• Shorts require a close crossing below the latest fractal low and below the low average.
• The document provides no backtest evidence or explicit position and risk management rules.

Tags

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