Trendline values
Where the lower and upper trendlines are on this bar, each joining the last two swing lows or highs.
It finds swing lows and highs: a low counts once price has risen by the swing size from it, a high once price has fallen that far. The lower line joins the last two swing lows and the upper line the last two swing highs, extended to the current bar. Both are in price, drawn over the candles.
How to read it
- The lower line rising means each swing low is higher than the one before; the upper line falling means lower highs.
- Close sitting between the lines is the usual state: on six months of SPY minute bars it was between them on 80% of bars.
- A close below the lower line is a break of the rising lows; a close above the upper line usually starts a new swing high.
What it outputs
- Lower line
- The line through the last two swing lows, read at this bar, in price.
- Upper line
- The line through the last two swing highs, read at this bar, in price.
Settings
- Swing size
- How far price must turn, as a fraction (0.005 is 0.5%), before a low or high counts as a swing. Raising it keeps only bigger swings, so lines last longer and start later; lowering it redraws them more often on smaller wiggles.
Pitfalls
- Each line is redrawn when a new swing confirms, so it jumps on that bar; the values before a jump came from the old line.
- Nothing draws until four swings have formed: at 0.5% on SPY one-minute bars that took about 4,200 bars, some 11 sessions.