This indicator acts as a filter for determining recent breakouts and consolidations in price.
The first way to use the indicator is with a short lookback period. It then will paint yellow most of the time, with red marking a sharp recent breakdown in price and green marking a sharp breakout in price. This can be used to follow the breakout, or to fade it.
The second way to use the indicator is a long lookback period. This will change the output to be colored most of the time, with small sections of yellow. The yellow indicators areas where price has not made a large move in a while, or periods of consolidation. This can then be used to plan reversal trades, or follows any new trend.
The blue line is a Average True Range Percent Rank, when this value is high, it means that breakouts are less likely to trigger, since price has been moving rapidly recently, and a relative breakout would have to be a large move. When the line is low, breakouts will trigger more easily, since price has been moving relatively slowly
sir may i know what is the best setting in 1 minute chart?
TK42DAN
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@makaveli12, I'm not the author, but I would say that it could depend on your market and even your trading style/goals. Best bet would be to do a thorough back test on the 1-minute and find the settings that line up with the ideal trades (ideal for you). Regardless of what anyone suggests, backtesting for yourself is the only real way of having confidence in a strategy. Good luck!