Three drives bottom setup event
Third touch of the 100-bar low after two rallies: a setup marker, not a confirmed turn.
Looks for the classic three-drives bottom: the close touches the recent low, rallies off it, touches it again, rallies once more, then touches it a third time. The low is the lowest close of the last 100 bars, and a touch means the close sits within eps of it. The marker lands on that third touch without waiting for price to turn up, and the state machine never leaves its final state, so it marks at most once per run.
How to read it
- Markers sit on the candles where the third touch happens, drawn on the price pane.
- A touch means the close is within 0.3% of the lowest close of the last 100 bars.
- Between touches the close must climb at least 0.4% off that low, or reach near the 100-bar high.
- The marker does not confirm a turn: watch whether price holds above the low after it.
What it outputs
- Bottom setup (third touch)
- Marks the bar where the close touches the recent low for the third time after two rallies. It flags the setup, not a reversal.
When it fires
When the close comes within eps of the 100-bar low for the third time, after two rallies off it. It reads as sellers testing the same low three times; it does not show buyers taking over. It fires at most once per run.
Settings
- eps
- How close the close must come to the 100-bar low, as a fraction of price, to count as a touch. Raising it (0.01 = 1%) makes touches easier, so the setup completes more often. Near 0 it needs an almost exact touch; below 0 it never fires.
- pullback
- How far the close must rise above the low between touches. Raising it demands a bigger bounce, but also widens the near-100-bar-high escape, so it is not a clean stricter gate. At 0 any bar counts, so the setup advances almost at once.
Pitfalls
- At defaults it marked once in about a month of SPY one-minute bars, and it never re-arms: later drives in the same run are not marked.
- The low and high come from closes over 100 bars (donchian_trends), not intraday lows and highs, despite that function's docstring.
- A falling market keeps making new lows, so each touch qualifies while price keeps falling; the marker does not check for a turn.