Trend Arrows: Support and Resistance Dots for Reversal Signals
Summary
Trend Arrows plots a moving support or resistance level as dots on a price chart. It uses an average price over a selected amount of data to calculate its values. During a downward trend it displays resistance dots; during an upward trend it displays support dots. The described trade signal occurs when price approaches the relevant level and fails to break through it on the current bar, suggesting a sell at resistance or a buy at support.
A subsequent dot is described as confirmation: it may indicate that the existing trend continues or that a change is developing. The document gives no parameter values, performance results, or detailed rules for choosing the averaging window, entering, or managing risk. It presents the indicator concept rather than evidence of profitability, so the signals would need independent testing across instruments and market conditions.
Key ideas
- The indicator plots support during upward trends and resistance during downward trends.
- A price test that fails to break the plotted level is treated as a possible trade signal.
- A following dot is used to confirm trend continuation or suggest a potential change.
- The document provides no performance evidence or detailed risk rules.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.