Reversal Knockout v1.1

\ Reversal Knockout v1.1 — User Manual \

Reversal Knockout is a technical indicator designed to detect potential price turning points using a dual approach: a reversal logic with bar coloring and a combined sequence of setups, countdowns, and exhaustion patterns.

\What does this indicator do?\

\Colors candles\ based on the relationship between two smoothed moving averages (T3).
\Identifies overextension conditions\ based on a sequence of 9 consecutive closes aligned with price direction.
\Confirms exhaustion\ if, after that setup, 13 follow-through conditions (countdown) are met.
\Highlights special signals called “Knockouts”\, which represent strong potential reversal scenarios.

\Candle Coloring\

Candles are automatically colored to make trend and potential reversal points visually easier to interpret:

🔵 Bull Trend: User-defined color (default light blue)
🔴 Bear Trend: User-defined color (default light red)
🟡 Bullish Reversal: When price crosses below the slower average (default yellow)
🟡 Bearish Reversal: When price crosses above the slower average (default yellow)

This logic is based on the relationship between two T3 moving averages (one fast, one slow), calculated with a customizable smoothing factor.

\Setup and Countdown Logic\

Setups (9):

A bullish setup forms if the price closes below the close from 4 bars earlier for 9 consecutive candles.
A bearish setup forms if the price closes above the close from 4 bars earlier for 9 consecutive candles.
When the ninth close is completed, a green “9” (buy) or purple “9” (sell) is displayed.

Countdowns (13):

After a setup, a follow-through phase begins.
If 13 additional conditions are met (price < low\[2] for buys or > high\[2] for sells), a purple “13” is shown, signaling potential exhaustion.

\Knockout: Explosive Reversal Potential\

The indicator also identifies special reversal patterns called \Knockout\.
These signals appear when, in addition to a “9”, the price shows technical excess behavior near key support or resistance zones:

Knockout ▲ (buy): Appears below the candle when a buy signal is detected with specific downside pressure conditions.
Knockout ▼ (sell): Appears above the candle when a sell signal is detected with upside pressure conditions.

These signals stand out as high-probability reversal opportunities.

\Usage Recommendations\

The indicator is designed to work on any timeframe, but it is recommended to use it alongside market structure and volume analysis.
“Knockout” signals may be used as high-probability trend change alerts, especially after a “13”.
Can be combined with momentum indicators and moving averages for greater effectiveness.