Using an ATR-Defined Pullback to Mark a Prior High for Breakouts

Summary

This indicator seeks a possible continuation setup after a strong upward move. It first calculates a reference price by combining daily, weekly, and monthly pivot values with several moving averages. A close more than two ATR above that reference starts the sequence; price must then extend another three ATR without returning to the reference. When price later pulls back to the reference, the indicator plots the highest high from the prior 33 days as a potential breakout level.

The level is cleared if price breaks above it or if the conditions for a fresh upward run occur again. The author describes the line as usable for either a pullback trade or a breakout trade, but gives no backtest, trade examples, or performance results. The post presents an experimental community indicator assembled through trial and error, so the formulas and behavior should be checked before use. It also does not define entries, exits, position sizing, or the precise instrument and timeframe assumptions.

Key ideas

• The reference price combines daily, weekly, and monthly pivots with moving averages.
• An initial rise of two ATR followed by a further three ATR without a return defines strong upward momentum.
• A return to the reference price triggers a line at the highest high of the preceding 33 days.
• The line is removed after a breakout above that high or when a fresh upward run is detected.
• The document proposes possible pullback and breakout uses but supplies no performance testing.

Tags

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