A trading filter that identifies when not to take long or short trades based on daily chart action, helping traders suppress potentially risky trade entries.
Explore complementary indicator rolesHow it works
The indicator analyzes the overlap between consecutive daily candles to determine potential trade suppression signals. It calculates the percentage of the previous candle that does not overlap with the current candle, focusing on identifying zones where trades might be unwise.
By default, the system reviews the last three days of price action and applies a smoothing mechanism to generate more reliable signals. When the new candle's low is significantly above the previous candle's low, it suggests avoiding short trades. Conversely, when the new candle's high is substantially below the previous candle's high, it indicates avoiding long trades.
Why it may be useful
This signal provides traders with an additional risk management tool that helps prevent entering trades during potentially unfavorable market conditions. By highlighting potential high-risk trading scenarios, it allows traders to be more selective and disciplined in their approach to market entry.
The indicator acts as a complementary filter to existing trading strategies, offering an extra layer of protection against impulsive or poorly timed trades. It encourages traders to wait for more confirmatory signals and helps reduce the likelihood of entering positions during volatile or uncertain market periods.
When to explore it
The signal works best for intraday traders who have an existing trading strategy and want an additional filter to improve trade selection. It is particularly useful in markets with moderate volatility where precise entry points can significantly impact trade performance.
Traders should consider this indicator most effective when combined with other technical analysis tools and when used across multiple timeframes. It is especially valuable for traders who want to reduce unnecessary trade entries and focus on higher-probability market opportunities.
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What we’ve verified
Access, alerts and repainting behaviour have not been independently verified for this indicator. Check the creator’s current publication and settings.
General descriptions and classifications are recovered research. Verified details above identify the specific checks we have completed. Check the creator’s current publication for later changes.
