PROTECTED SOURCE SCRIPT
Veryfid Stacks
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VERYFID STACKS - PARALLEL CHANNEL DETECTION SYSTEM
TECHNICAL INDICATOR DOCUMENTATION
------------------------------------------------------------------------------------
Table of Contents:
1. Chart Mechanics Background
2. Parallel Channel Theory
3. Veryfid Stacks Components
3.1. Bottom Pivot Channel Detection
3.2. Top Pivot Channel Detection
3.3. Channel Validation System
3.4. Stacking Algorithm
3.5. Dynamic Extension Logic
3.6. Visual Enhancement Features
4. References & Further Reading
------------------------------------------------------------------------------------
1. CHART MECHANICS BACKGROUND
------------------------------------------------------------------------------------
Creator: veryfid, a trading methodology developer specializing in geometric market
analysis and electrical engineering principles applied to financial markets.
Origins: Developed from the foundational principle that "every chart is just parallel
lines within parallel lines," Chart Mechanics represents a systematic approach to
identifying market structure through geometric relationships.
Theoretical Foundation: Based on the concept that price action behaves according to
parallel circuit principles, where market movements follow predictable geometric
patterns that can be identified and exploited through proper channel analysis.
Traditional Market Structure: Most traders focus on support and resistance levels
without understanding the underlying parallel relationships that govern price
movement. Chart Mechanics addresses this gap by providing a systematic method for
identifying these parallel systems.
Difference from Conventional Analysis: Unlike traditional trend line analysis that
relies on subjective line drawing, Chart Mechanics uses objective pivot point
connections to automaticaly identify parallel channel systems with mathematical
precision.
------------------------------------------------------------------------------------
2. PARALLEL CHANNEL THEORY
------------------------------------------------------------------------------------
Mathematical Foundation: Channels are constructed using validated pivot points that
create parallel lines with consistent geometric relationships. The theory suggests
that markets naturally move within these parallel systems, which can halve or double
in width based on market conditions.
Channel Behavior: Price tends to respect parallel boundaries, creating predictable
support and resistance zones. When channels break, they often lead to the formation
of new parallel systems at different angles or widths.
Validation Requirements: Channels must demonstrate multiple connection points to be
considered valid. This reduces false signals and ensures that only statistically
significant patterns are identified for trading purposes.
Stacking Principle: Multiple parallel channels can exist simultaneously at different
levels, creating a comprehensive framework for understanding price targets and
potential reversal zones.
Technical Implementation: The system uses dual lookback periods to identify pivot
points and applies geometric calculations to create parallel lines with proper slope
and spacing relationships.
------------------------------------------------------------------------------------
3. VERYFID STACKS COMPONENTS
------------------------------------------------------------------------------------
3.1. BOTTOM PIVOT CHANNEL DETECTION
------------------------------------------------------------------------------------
Description: Automated identification of upward-trending parallel channels using
bottom pivot connections to establish channel boundaries.
Calculation: Analyzes pivot lows using configurable lookback periods (default 10, 50)
to identify potential channel formation points. The system connects validated bottom
pivots to create ascending parallel lines that define upward trending channels.
Implementation Advantage: By focusing on bottom pivot connections, the bottom pivot channel
detection provides more accurate identification of support levels and upward
trending boundaries compared to traditional trend line methods.
Validation Logic: Requires positive slope calculations and minimum bar differance
between pivot points to ensure channel validity. Multiple connection points strengthen
channel reliability.
Interpretation:
- Upper boundary serves as dynamic resistance
- Lower boundary provides dynamic support
- Channel median indicates neutral price zone
- Multiple touches increase channel strength
Trading Application: Use bottom pivot channels to identify potential buying opportunities
near support boundaries and profit-taking zones near resistance levels.
------------------------------------------------------------------------------------
3.2. TOP PIVOT CHANNEL DETECTION
------------------------------------------------------------------------------------
Description: Systematic identification of downward-trending parallel channels using
top pivot connections to establish channel frameworks.
Calculation: Utilizes pivot highs with independent lookback periods to identify
top pivot channel formation. The algorithm connects validated top pivots to
create parallel lines that define downward trending price movements.
Technical Origin: Based on the principle that downward trending markets create predictable
parallel support and resistance patterns that can be identified through top
pivot analysis.
Validation Requirements: Channels must demonstrate negative slope and meet minimum
width calculations to qualify as valid top pivot patterns. Force mode override
ensures both bottom pivot and top pivot channels display when conditions are met.
Interpretation:
- Lower boundary acts as dynamic support in downtrends
- Upper boundary provides dynamic resistance
- Median line indicates equilibrium pricing
- Channel touches confirm pattern strength
Trading Application: Top pivot channels help identify potential short-selling
opportunities near resistance boundaries and covering zones near support levels.
------------------------------------------------------------------------------------
3.3. CHANNEL VALIDATION SYSTEM
------------------------------------------------------------------------------------
Description: Mathematical verification process that ensures only statistically
significant channel patterns are displayed to traders.
Calculation: Uses connection point theory to validate channel formations. Requires
multiple pivot touches on both channel boundaries before confirming pattern validity.
The system also verifies proper slope relationships and channel width consistency.
Research Base: Draws from geometric analysis principles and statistical validation
methods to reduce false signals and improve trading accuracy.
Implementation Features:
- Minimum connection point requirements
- Slope validation for trend direction
- Width calculations for proportional spacing
- Real-time status monitoring (ACTIVE/WAITING states)
Interpretation:
- ACTIVE status indicates validated channel with multiple touches
- WAITING status shows potential channel formation requiring additional confirmation
- Connection point dots highlight validation touches
- Status table provides real-time channel health monitoring
Trading Application: Only trade channels with ACTIVE status to ensure statistical
significance and reduce false breakout risks.
------------------------------------------------------------------------------------
3.4. STACKING ALGORITHM
------------------------------------------------------------------------------------
Description: Advanced feature that creates additional parallel channels above and
below primary channels, providing extended price targets and support/resistance levels.
Calculation: Uses proportional width-based spacing to create double and triple
channel layers. New channels are positioned using calculated channel width as the
spacing measurement, maintaining geometric relationships.
Mathematical Implementation: Stacked channels maintain parallel relationships with
the primary channel while extending price analysis to broader support and resistance
zones. Directional control allows stacking upward or downward from primary lines.
Technical Advantage: Provides traders with multiple price targets and extended
analysis zones, improving position managment and profit-taking strategies.
Interpretation:
- Double channels create secondary support/resistance levels
- Triple channels provide extended price targets
- Stacked levels often act as significant reversal zones
- Width-based spacing ensures proportional relationships
Trading Application: Use stacked channels for scaling into positions, setting
multiple profit targets, and identifying potential reversal zones beyond primary
channel boundaries.
------------------------------------------------------------------------------------
3.5. DYNAMIC EXTENSION LOGIC
------------------------------------------------------------------------------------
Description: Real-time line extension system that projects channel boundaries into
future price action for forward-looking analysis.
Calculation: Extends validated channels from earliest pivot points to future bars
using geometric slope calculations. The system updates all lines on every bar to
maintain accurate projections.
Technical Foundation: Based on the principle that validated parallel channels tend
to continue their geometric relationships until definitively broken by price action.
Implementation Features:
- Automatic line extension from historical pivots
- Real-time updates on every bar
- Future projection for forward analysis
- Geometric slope preservation
Interpretation:
- Extended lines provide future support/resistance levels
- Projections help identify potential price targets
- Real-time updates ensure accuracy
- Slope consistency maintains channel integrity
Trading Application: Use extended channel lines to plan future trades, set price
targets, and anticipate potential support/resistance encounters.
------------------------------------------------------------------------------------
3.6. VISUAL ENHANCEMENT FEATURES
------------------------------------------------------------------------------------
Description: Comprehensive visual customization system designed to improve chart
readability and enhance pattern recognition capabilities.
Calculation: Implements customizable colors, transparency levels, and line styles
to create clear visual distinction between different channel components and states.
Design Features:
- Customizable channel line colors and transparency
- Median dashed lines for center identification
- Pivot point validation markers
- Real-time status table display
- Line extension controls
Interpretation:
- Color coding distinguishes bottom pivot vs top pivot channels
- Transparency levels prevent chart clutter
- Dashed median lines highlight channel centers
- Pivot markers confirm validation points
- Status table provides quick channel health overview
Trading Application: Visual enhancements improve pattern recognition speed and
reduce analysis errors, particularly during fast-moving market conditions.
------------------------------------------------------------------------------------
4. REFERENCES & FURTHER READING
------------------------------------------------------------------------------------
1. veryfid. "Chart Mechanics Theory: Parallel Lines Within Parallel Lines."
TradingView Educational Series.
2. Murphy, J. J. (1999). "Technical Analysis of the Financial Markets."
New York Institute of Finance.
3. Andrews, A. (1964). "Action and Reaction in Technical Analysis."
Original Andrews Pitchfork Research.
4. Bulkowski, T. N. (2005). "Encyclopedia of Chart Patterns."
2nd Edition, Wiley Trading.
5. Schwager, J. D. (1996). "Technical Analysis." Wiley Finance.
------------------------------------------------------------------------------------
END OF DOCUMENTATION
------------------------------------------------------------------------------------
VERYFID STACKS - PARALLEL CHANNEL DETECTION SYSTEM
TECHNICAL INDICATOR DOCUMENTATION
------------------------------------------------------------------------------------
Table of Contents:
1. Chart Mechanics Background
2. Parallel Channel Theory
3. Veryfid Stacks Components
3.1. Bottom Pivot Channel Detection
3.2. Top Pivot Channel Detection
3.3. Channel Validation System
3.4. Stacking Algorithm
3.5. Dynamic Extension Logic
3.6. Visual Enhancement Features
4. References & Further Reading
------------------------------------------------------------------------------------
1. CHART MECHANICS BACKGROUND
------------------------------------------------------------------------------------
Creator: veryfid, a trading methodology developer specializing in geometric market
analysis and electrical engineering principles applied to financial markets.
Origins: Developed from the foundational principle that "every chart is just parallel
lines within parallel lines," Chart Mechanics represents a systematic approach to
identifying market structure through geometric relationships.
Theoretical Foundation: Based on the concept that price action behaves according to
parallel circuit principles, where market movements follow predictable geometric
patterns that can be identified and exploited through proper channel analysis.
Traditional Market Structure: Most traders focus on support and resistance levels
without understanding the underlying parallel relationships that govern price
movement. Chart Mechanics addresses this gap by providing a systematic method for
identifying these parallel systems.
Difference from Conventional Analysis: Unlike traditional trend line analysis that
relies on subjective line drawing, Chart Mechanics uses objective pivot point
connections to automaticaly identify parallel channel systems with mathematical
precision.
------------------------------------------------------------------------------------
2. PARALLEL CHANNEL THEORY
------------------------------------------------------------------------------------
Mathematical Foundation: Channels are constructed using validated pivot points that
create parallel lines with consistent geometric relationships. The theory suggests
that markets naturally move within these parallel systems, which can halve or double
in width based on market conditions.
Channel Behavior: Price tends to respect parallel boundaries, creating predictable
support and resistance zones. When channels break, they often lead to the formation
of new parallel systems at different angles or widths.
Validation Requirements: Channels must demonstrate multiple connection points to be
considered valid. This reduces false signals and ensures that only statistically
significant patterns are identified for trading purposes.
Stacking Principle: Multiple parallel channels can exist simultaneously at different
levels, creating a comprehensive framework for understanding price targets and
potential reversal zones.
Technical Implementation: The system uses dual lookback periods to identify pivot
points and applies geometric calculations to create parallel lines with proper slope
and spacing relationships.
------------------------------------------------------------------------------------
3. VERYFID STACKS COMPONENTS
------------------------------------------------------------------------------------
3.1. BOTTOM PIVOT CHANNEL DETECTION
------------------------------------------------------------------------------------
Description: Automated identification of upward-trending parallel channels using
bottom pivot connections to establish channel boundaries.
Calculation: Analyzes pivot lows using configurable lookback periods (default 10, 50)
to identify potential channel formation points. The system connects validated bottom
pivots to create ascending parallel lines that define upward trending channels.
Implementation Advantage: By focusing on bottom pivot connections, the bottom pivot channel
detection provides more accurate identification of support levels and upward
trending boundaries compared to traditional trend line methods.
Validation Logic: Requires positive slope calculations and minimum bar differance
between pivot points to ensure channel validity. Multiple connection points strengthen
channel reliability.
Interpretation:
- Upper boundary serves as dynamic resistance
- Lower boundary provides dynamic support
- Channel median indicates neutral price zone
- Multiple touches increase channel strength
Trading Application: Use bottom pivot channels to identify potential buying opportunities
near support boundaries and profit-taking zones near resistance levels.
------------------------------------------------------------------------------------
3.2. TOP PIVOT CHANNEL DETECTION
------------------------------------------------------------------------------------
Description: Systematic identification of downward-trending parallel channels using
top pivot connections to establish channel frameworks.
Calculation: Utilizes pivot highs with independent lookback periods to identify
top pivot channel formation. The algorithm connects validated top pivots to
create parallel lines that define downward trending price movements.
Technical Origin: Based on the principle that downward trending markets create predictable
parallel support and resistance patterns that can be identified through top
pivot analysis.
Validation Requirements: Channels must demonstrate negative slope and meet minimum
width calculations to qualify as valid top pivot patterns. Force mode override
ensures both bottom pivot and top pivot channels display when conditions are met.
Interpretation:
- Lower boundary acts as dynamic support in downtrends
- Upper boundary provides dynamic resistance
- Median line indicates equilibrium pricing
- Channel touches confirm pattern strength
Trading Application: Top pivot channels help identify potential short-selling
opportunities near resistance boundaries and covering zones near support levels.
------------------------------------------------------------------------------------
3.3. CHANNEL VALIDATION SYSTEM
------------------------------------------------------------------------------------
Description: Mathematical verification process that ensures only statistically
significant channel patterns are displayed to traders.
Calculation: Uses connection point theory to validate channel formations. Requires
multiple pivot touches on both channel boundaries before confirming pattern validity.
The system also verifies proper slope relationships and channel width consistency.
Research Base: Draws from geometric analysis principles and statistical validation
methods to reduce false signals and improve trading accuracy.
Implementation Features:
- Minimum connection point requirements
- Slope validation for trend direction
- Width calculations for proportional spacing
- Real-time status monitoring (ACTIVE/WAITING states)
Interpretation:
- ACTIVE status indicates validated channel with multiple touches
- WAITING status shows potential channel formation requiring additional confirmation
- Connection point dots highlight validation touches
- Status table provides real-time channel health monitoring
Trading Application: Only trade channels with ACTIVE status to ensure statistical
significance and reduce false breakout risks.
------------------------------------------------------------------------------------
3.4. STACKING ALGORITHM
------------------------------------------------------------------------------------
Description: Advanced feature that creates additional parallel channels above and
below primary channels, providing extended price targets and support/resistance levels.
Calculation: Uses proportional width-based spacing to create double and triple
channel layers. New channels are positioned using calculated channel width as the
spacing measurement, maintaining geometric relationships.
Mathematical Implementation: Stacked channels maintain parallel relationships with
the primary channel while extending price analysis to broader support and resistance
zones. Directional control allows stacking upward or downward from primary lines.
Technical Advantage: Provides traders with multiple price targets and extended
analysis zones, improving position managment and profit-taking strategies.
Interpretation:
- Double channels create secondary support/resistance levels
- Triple channels provide extended price targets
- Stacked levels often act as significant reversal zones
- Width-based spacing ensures proportional relationships
Trading Application: Use stacked channels for scaling into positions, setting
multiple profit targets, and identifying potential reversal zones beyond primary
channel boundaries.
------------------------------------------------------------------------------------
3.5. DYNAMIC EXTENSION LOGIC
------------------------------------------------------------------------------------
Description: Real-time line extension system that projects channel boundaries into
future price action for forward-looking analysis.
Calculation: Extends validated channels from earliest pivot points to future bars
using geometric slope calculations. The system updates all lines on every bar to
maintain accurate projections.
Technical Foundation: Based on the principle that validated parallel channels tend
to continue their geometric relationships until definitively broken by price action.
Implementation Features:
- Automatic line extension from historical pivots
- Real-time updates on every bar
- Future projection for forward analysis
- Geometric slope preservation
Interpretation:
- Extended lines provide future support/resistance levels
- Projections help identify potential price targets
- Real-time updates ensure accuracy
- Slope consistency maintains channel integrity
Trading Application: Use extended channel lines to plan future trades, set price
targets, and anticipate potential support/resistance encounters.
------------------------------------------------------------------------------------
3.6. VISUAL ENHANCEMENT FEATURES
------------------------------------------------------------------------------------
Description: Comprehensive visual customization system designed to improve chart
readability and enhance pattern recognition capabilities.
Calculation: Implements customizable colors, transparency levels, and line styles
to create clear visual distinction between different channel components and states.
Design Features:
- Customizable channel line colors and transparency
- Median dashed lines for center identification
- Pivot point validation markers
- Real-time status table display
- Line extension controls
Interpretation:
- Color coding distinguishes bottom pivot vs top pivot channels
- Transparency levels prevent chart clutter
- Dashed median lines highlight channel centers
- Pivot markers confirm validation points
- Status table provides quick channel health overview
Trading Application: Visual enhancements improve pattern recognition speed and
reduce analysis errors, particularly during fast-moving market conditions.
------------------------------------------------------------------------------------
4. REFERENCES & FURTHER READING
------------------------------------------------------------------------------------
1. veryfid. "Chart Mechanics Theory: Parallel Lines Within Parallel Lines."
TradingView Educational Series.
2. Murphy, J. J. (1999). "Technical Analysis of the Financial Markets."
New York Institute of Finance.
3. Andrews, A. (1964). "Action and Reaction in Technical Analysis."
Original Andrews Pitchfork Research.
4. Bulkowski, T. N. (2005). "Encyclopedia of Chart Patterns."
2nd Edition, Wiley Trading.
5. Schwager, J. D. (1996). "Technical Analysis." Wiley Finance.
------------------------------------------------------------------------------------
END OF DOCUMENTATION
------------------------------------------------------------------------------------
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discord.gg/JEvMhzdsWw
Our Free discord link for the Maverick Trading Suite
Our Free discord link for the Maverick Trading Suite
Declinazione di responsabilità
Le informazioni ed i contenuti pubblicati non costituiscono in alcun modo una sollecitazione ad investire o ad operare nei mercati finanziari. Non sono inoltre fornite o supportate da TradingView. Maggiori dettagli nelle Condizioni d'uso.
Script protetto
Questo script è pubblicato come codice protetto. Tuttavia, è possibile utilizzarlo liberamente e senza alcuna limitazione – per saperne di più clicca qui.
discord.gg/JEvMhzdsWw
Our Free discord link for the Maverick Trading Suite
Our Free discord link for the Maverick Trading Suite
Declinazione di responsabilità
Le informazioni ed i contenuti pubblicati non costituiscono in alcun modo una sollecitazione ad investire o ad operare nei mercati finanziari. Non sono inoltre fornite o supportate da TradingView. Maggiori dettagli nelle Condizioni d'uso.