Market Structure Signals with Dual Pivots and an ATR Value Zone
Summary
This indicator describes market structure using two symmetric pivot windows: a faster internal scale and a slower external scale. It tracks recent pivot highs and lows, compares successive swings, and maintains a bullish or bearish state. A close through a pivot against the prior state is labeled a Change of Character, while a break in the existing direction is a Break of Structure. Failed breaks that close back inside the pivot level are marked as rejection signals.
An ATR-scaled zone around an external-period moving average appears while the structure state remains consistently bullish or bearish. The article suggests using the state as a directional filter, pivots as invalidation levels, and the zone as a pullback reference. It explains that centered pivots are confirmed only after the specified bars have passed, creating lag. These are indicator interpretations and proposed applications, not demonstrated trading results; the text supplies no performance statistics or validation across markets. Parameter choices affect swing sensitivity and the placement of the zone.
Key ideas
- The indicator tracks internal and external swing pivots using symmetric windows.
- Its state distinguishes ordinary directional breaks from stronger states supported by higher-high/higher-low or lower-high/lower-low sequences.
- A break against the previous state is marked as a possible reversal, while a break with it indicates continuation.
- Failed breaks are flagged when price crosses a pivot intrabar but closes back across it.
- An ATR-scaled zone is drawn only while the structure state remains consistently directional.
- Centered pivots confirm after a delay, and the document provides no performance evidence for its suggested uses.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.