Risk-Reward Labels Minimal with Offset

6 giorni fa

Indicator Explanation
The indicator “Risk-Reward Labels Minimal with Offset” is designed to assist traders in managing risk and potential rewards. It displays the Stop-Loss (SL) and Take-Profit (TP) levels for both long and short positions based on identified support and resistance levels.
Key Features:
1. Risk-Reward Ratio: Traders can adjust the risk-reward ratio to define the relationship between potential losses and potential gains (e.g., 1:1 or 1:2).
2. Risk Distance: The distance (in pips) is set to determine where to place the SL and TP levels.
3. Labels with Offset: SL and TP labels can be shifted by an offset (bars), allowing for better visualization.
4. Support and Resistance Levels: The indicator dynamically calculates support and resistance. When a support or resistance level is broken, the corresponding labels are deleted.
5. Display in Range Markets: If the market is ranging or lacks a clear trend, both long and short labels are displayed. This allows traders to identify potential entry opportunities in both directions, even when the market is not clearly trending.
6. Deletion Logic: If the price falls below support or rises above resistance, the relevant SL and TP labels are removed. However, in a Range situation, the possibility of seeing both long and short labels remains, increasing flexibility and helping to avoid false signals.

5 giorni fa

Note di rilascio

Risk-Reward Labels Minimal with Offset" is a Pine Script designed to help traders visually mark risk-reward ratios on their charts. This script is particularly useful for traders who want to set clear stop-loss and take-profit targets based on support and resistance levels.

What Does the Script Do?
It automatically identifies support and resistance levels based on the lowest and highest candles within a customizable period (default: 4 candles), regardless of the timeframe used (e.g., 1 minute or 1 day).
Based on a defined risk distance (e.g., in pips) and a risk-reward ratio, the script calculates the corresponding stop-loss and take-profit levels.
It visually draws easily recognizable labels directly on the chart, displayed separately for long and short positions.
If a support or resistance level is broken, the corresponding labels are automatically removed to maintain the clarity of the chart.
How Does the Script Work?
Support and Resistance:
The script analyzes the most recent candles and identifies the lowest or highest candle within a defined interval as a potential support or resistance level.

SL and TP Calculation:
Once a support or resistance level is identified, the script calculates:

Stop-Loss: As support minus distance (for long) or resistance plus distance (for short).
Take-Profit: As support plus distance * risk-reward ratio (for long) or resistance minus distance * risk-reward ratio (for short).
Label Customization:
Labels are drawn at an adjustable distance from the candles. Their color, size, and transparency can be customized according to user preferences.

Dynamic Adjustment:
As support or resistance levels change, old labels are automatically removed, and new ones are created.

How to Use the Script?
Configure Settings:

Input a risk-reward ratio (e.g., 2.0 for a 1:2 target).
Choose a risk distance in pips, which serves as the basis for the calculations.
Customize the transparency, size, and colors of the labels.
Start Analysis:

Once the script is applied to the chart, support and resistance levels are automatically identified (default: 4 candles, adjustable to match your trading strategy).
Corresponding SL/TP labels will appear on the chart. You can specify the number of candles after which the SL/TP levels should be calculated based on your trading approach (e.g., SMA 20 means 20 candles).
Monitor:

The labels dynamically adapt to market movements. Broken levels are automatically removed, reducing the need for manual adjustments.
Concepts Behind the Calculations
The script is based on price action and support/resistance, two of the most fundamental principles in trading.
By calculating a fixed risk-reward ratio, it ensures trades are evaluated consistently and systematically.
Automation saves time and minimizes the risk of errors that can occur when manually setting SL and TP levels.