Using ATR, ATR Trends, Price Action, and OBV for Candle Signals

Summary

This indicator displays the prior candle range alongside a 10-period Average True Range (ATR) and a 20-period exponential average of ATR. It changes the text color when ATR rises above its smoothed average, presenting that condition as a possible sign of stronger movement or volatility when the candle range also exceeds ATR. These displays are informational rather than a tested volatility forecast.

For directional arrows, it compares a normalized measure of bullish versus bearish price movement over 20 bars with its 20-period exponential average. A green upward arrow appears when that trend measure is above its average and On-Balance Volume (OBV) is above both its 10- and 20-period averages; the reverse conditions produce a red downward arrow. The document provides indicator logic but no performance evidence, exit rules, or risk controls, so the signals should not be read as validated trading recommendations.

Key ideas

• The display combines the previous candle range with ATR and a smoothed ATR reference.
• ATR above its exponential average is highlighted as a possible increase in volatility.
• Directional arrows require both a price trend comparison and confirmation from OBV averages.
• The indicator offers entry-style cues but provides no backtest, exits, or risk management.

Tags

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