SuperTrend Direction Changes from ATR Bands

Summary

This SuperTrend indicator builds trailing upper and lower bands around a selected price source using ATR and a multiplier. The default configuration uses a 10-period ATR and a multiplier of 3, with the source set to the midpoint of each bar’s high and low. The bands are adjusted using prior values and closes, then the trend state switches when price crosses the relevant prior band. A change from down to up marks a buy signal; a change from up to down marks a sell signal. Optional settings control the ATR calculation method, signal labels, and chart highlighting.

The document includes published settings for a BTC/USDT Binance futures chart using four-hour bars with 15-minute base data over roughly a year. It gives no performance statistics, so those settings are context rather than evidence of profitability. The code enters long or short positions when direction changes but does not specify stop-loss, take-profit, or position-sizing rules. As a lagging, volatility-based trend indicator, it may switch late or produce repeated reversals in choppy markets; the multiplier and ATR method affect its behavior.

Key ideas

• SuperTrend constructs volatility bands from ATR around a configurable price source.
• The bands trail using previous band values and closing prices.
• A close crossing the prior band changes the trend state and generates a directional signal.
• The indicator offers alternative ATR calculations and optional chart labels and highlighting.
• The example enters on direction changes but provides no explicit position sizing or protective exits.

Tags

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