Guppy's Count Back Line for Volatility-Based Trend Levels

Summary

The Count Back Line (CBL), attributed to Daryl Guppy, is presented as a volatility-based indicator with upper and lower levels that can mark potential trend boundaries. The supplied implementation searches backward from a new high for two successively lower lows to update the lower line; after a new low, it searches for two higher highs to update the upper line. A close through either active level resets that side. The plotted segments are intended to show these levels only while they remain active.

The code sets a finite lookback limit and uses reset values to hide inactive segments. The author describes the implementation as a first attempt and cautions that it may be incorrect; an optimization note also indicates the repeated search could be improved. The document offers no market examples, validation, or trading rules for entries and exits. Treat the code as an illustrative interpretation of CBL and verify its behavior against a trusted definition before using it in a strategy.

Key ideas

• The indicator tracks an upper and lower Count Back Line as candidate trend boundaries.
• A new high triggers a backward search for two lower lows to update the lower level.
• A new low triggers a backward search for two higher highs to update the upper level.
• A close beyond an active level resets it, and reset values are hidden from the plot.
• The author warns that the code may be incorrect and supplies no performance evidence.

Tags

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