Forex Master Pattern Contraction Finder by nnam

2022년 9월 8일

This script is for use with the FOREX Master Pattern to assist the user with drawing in True Value areas.

The script uses a combination of LOWER HIGHS and HIGHER LOWS to pinpoint areas of potential contraction and marks them with an X.
Using these X symbols as visual guidance, the user can easily locate areas of contraction or "tightening" of the price as it comes out of the expansion phase.

In addition, the daily highs and lows create a visible red or green box (depending on price in relation to the previous days close). These boxes also assist the user in determining the average price for the day and whether or not the price is contracting. A WIDE box is indicative of an expansion phase or widening in price swings and a "skinny" box is indicative of a tightening in price swings [also known as crabbing].

A combination of both plotted X contraction signals and a tightening box are highly indicative of a contraction phase. These contraction phases appear early in the beginning stage of the FOREX MASTER PATTERN giving the user ample time to plan trades and spot breakouts from the contraction into expansion.



The Image above shows a prime example of a potential contraction in price on the ETH/USDT 1 hour chart.

A series of highs and lows shows an expansion. The indicator settings allow the user to turn ON a visual text label showing each higher high, lower high, higher low and lower low in any combination.

Lower High and Higher low is ON by default and is represented by BOTH an X and the initials LH above bar and HL below bar for easier identification of the actual bar that triggered the signal.

In the absence of an X signal or initials LH + HL the contraction is not confirmed. As you can see in the screenshot below, the boxes alone are not indicative of a contraction and can be false positives. It is important to wait for both.



INPUTS AND SETTINGS

To make the indicator more user friendly, I have added several on off buttons for certain attributes. Many are OFF by default for a clean look when first starting the indicator. Below is a list of settings and what they are.

Contraction Settings
- Show potential contractions on chart?
on by default - shows the Lower Highs and Lower Lows with an X sumbol

Moving Average Settings
Exponential Moving Average Length
default is 50EMA but can be changed
- Show Moving Average on chart?
off by default and must be checked to add the ema

RSI Settings
- Show RSI Overbought and Oversold?
off by default
Users can turn this on and use in conjunction with higher high and lower high to spot potential reversals

RSI Source - default is CLOSE
RSI Length - default is 6
RSI Overbought Level - default is 85
RSI Oversold Level - default is 15

Chart Type Settings
- Use Renko Style Pivots?
Allows Renko to be used (open/close for high/low)
off by default

LOWER HIGHS AND LOWER LOWS (VIEW BULLISH TRENDS)
Show higher highs?
Show Higher Lows?

These can be turned on or off depending on your preference for trend spotting.
https://www.tradingview.com/x/lPV1slyt/

LOWER HIGHS AND LOWER LOWS (VIEW BEARISH TRENDS)
Show Lower Highs?
Show Lower Lows?
These can be turned on or off depending on your preference for trend spotting.


BUY AND SELL SIGNALS SETTINGS
(these are experimental)

- Show Potential BUY signals on chart?
- Show Potential SELL signals on chart?


These 'experimental signals' combine overbought RSI with Higher Highs and Oversold RSI with Lower Lows to signal a potential turn in price.
During major corrections you may get several BUY signals in a row as the price plummets and during FOMO bull runs, you may get several SELL signals in a row.
To help minimize this, you can turn ON the Renko option listed above and change the RSI to a higher number.
The signals work best using Heikin Ashi and on 1 hour time frames.

In order for a trigger to occur, the script ensures there are several RSI overbought and oversold signals in a row.
RSI and Higher High, Lower Low options do not have to be turned on to get the signals.

BOX Settings
You can change the border width and color of the boxes.
You may also JOIN the boxes if you want to.

I really hope you enjoy this indicator and I hope it brings you good luck in your trading.

Don't forget to follow so you are notified when I upload any new indicators.

nnamdert

2022년 9월 14일

릴리즈 노트

Minor script cleanup (changed the SELL label from SELL to LONG TP) and (changed the BUY label from BUY to Short TP) as these terms are more accurate.

2022년 11월 28일

릴리즈 노트

Added max_lines_count and adjustable input for up to 500 lines with default set to 2

Added show Pivots Input

Changed Show RSI Input to default = TRUE

Changed buy and sell signals to take profit signals

Added Equal Highs/Lows indicator settings

Adjusted the offset for the Higher Lows and Lower Highs as they were off by a little.