Local-Extreme Reversal Signals from Candlestick Closures

Summary

This indicator describes a reversal system that searches a chosen number of completed candles for a local high or low. A sell setup occurs when a candle marks the interval’s high and then closes bearish; a buy setup occurs when a candle marks the low and closes bullish. The suggested action is to enter at the opening of the following candle. The author says the approach works best on the H6 timeframe.

The interval parameter controls how many bars are examined, and an optional setting sends an email when a signal appears. The document provides a conceptual description and an example reference, but no test results, win rate, or risk-management rules. It does not explain how to handle overlapping extrema, gaps at the next open, or false reversals. Signals therefore describe a pattern for further evaluation rather than evidence of a profitable strategy.

Key ideas

• The indicator scans a configurable number of completed candles for a local high or low.
• A bearish close at a local high generates a sell signal for the next candle’s open.
• A bullish close at a local low generates a buy signal for the next candle’s open.
• The author identifies H6 as the system’s preferred timeframe.
• No performance results or trade-risk rules are provided.

Tags

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