Toby Crabel Narrow Range Patterns for Volatility Breakouts

Summary

This document describes an indicator for identifying narrow range bars (NR) and optionally wide range bars (WR). Narrow ranges mark periods whose high-to-low span is the smallest among comparable windows over a prior lookback. The indicator supports fixed two-, three-, four-, and eight-day patterns, as well as a custom sample length and comparison period. Users can choose whether to show each pattern type and whether to exclude the current bar from the search.

The description explains the pattern definitions and input settings, but it provides no entry or exit rules, performance evidence, or guidance for trading signals. A narrow range can be used to flag contraction that a trader may examine for a later breakout, but the document does not specify that strategy or establish that the pattern predicts direction or profitable moves. Results also depend on the selected window, comparison period, and whether the active bar is included.

Key ideas

• The indicator identifies narrow high-to-low ranges over selected sample lengths.
• It offers fixed two-, three-, four-, and eight-day pattern definitions, plus custom settings.
• The comparison lookback is twenty days for the two- and three-day patterns and forty days for the four- and eight-day patterns.
• Wide range and narrow range labels can be displayed separately.
• The document defines an indicator, not a complete trading strategy or a tested source of returns.

Tags

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