Island Reversal Indicator Inputs and Range Thresholds

Summary

This brief indicator note introduces Island Reversal, abbreviated IR, and lists its inputs as close, high, low, a lookback length, and a percentage parameter. Its pseudocode calculates prior-period high and low boundaries, then derives two price levels inside the current high-low range using the percentage parameter. These calculations appear intended to support an island-reversal indicator, a chart pattern associated with abrupt price gaps and potential reversals.

The note does not explain the complete signal conditions, how the calculated levels identify an island pattern, or how a trader should enter or exit. It points to a separate document for the indicator's meaning, but that explanation is not included here. There are no examples, parameter guidance, backtests, or evidence about predictive performance, so the formulas alone are insufficient to evaluate the indicator as a trading rule.

Key ideas

• The IR indicator takes close, high, low, lookback length, and percentage inputs.
• Its pseudocode computes prior-period high and low reference levels.
• It also defines two percentage-based levels within the current high-low range.
• The note does not specify full signal rules or provide performance evidence.

Tags

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