OPEN-SOURCE SCRIPT
ATR Impact Candles
ATR Impact Candles: Simplify Your Trading with Pure Price Action
You don’t need dozens of cluttered indicators to catch what really matters. With ATR Impact Candles, you get a powerful, single-tool solution that cuts through the noise by focusing on what truly drives the market: price action and volatility. This indicator highlights only those candlesticks that pack a punch—showing you when the market’s range is exceptionally strong relative to its recent behavior. Whether you’re a scalper or a swing trader, ATR Impact Candles empowers you to time your entries and exits with confidence, letting you trade based on real market momentum.
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Indicator Overview
The indicator is designed for TradingView and is implemented in Pine Script (version 5). Its primary purpose is to highlight specific candles that meet a defined volatility condition based on the Average True Range (ATR). Instead of modifying every candle’s appearance, the indicator only changes the color of those “signal” candles that exceed a user-defined multiple of the ATR. The rest of the candles remain in their traditional black and white appearance—preserving the classic candlestick chart look.
⸻
Key Features
1. ATR-Based Signal Identification:
• ATR Calculation:
The indicator calculates the ATR using a configurable lookback period (default is 14 periods). The ATR is a common volatility measure that reflects the average range of price movement.
• Threshold Condition:
A candle is flagged as a signal if its range (high minus low) meets or exceeds a specified multiple (the “ATR Factor”) of the ATR. By default, this factor is set to 2, meaning any candle whose range is at least twice the ATR is considered significant.
2. Dynamic Candle Coloring:
• Signal Candles:
• When a candle meets the ATR threshold condition:
• Up Candles: are colored green.
• Down Candles: are colored red.
• Non-Signal Candles:
• Candles that do not meet the threshold condition retain their classic appearance:
• Up candles are white.
• Down candles are black.
3. User Configurability:
• ATR Period:
Traders can adjust the ATR period to tailor the volatility measure to different markets or timeframes.
• ATR Factor:
The multiple of the ATR that defines a signal candle is also configurable, giving flexibility to experiment with different thresholds for what constitutes “significant” price movement.
• Overlay Display:
The indicator runs in overlay mode on the chart, meaning it directly affects the appearance of the candlestick bars without interfering with other chart elements.
4. Additional Visual Aid:
• Threshold Line Plot:
The script optionally plots a line representing the ATR multiplied by the chosen factor. This line serves as a visual benchmark on the chart, allowing traders to see at what level the ATR threshold lies relative to the price action.
⸻
How It Works
1. ATR Calculation:
The indicator first calculates the Average True Range (ATR) for the defined period. This value is updated for each new candle.
2. Range Comparison:
For each candle, the indicator calculates the range (high - low) and compares it to the threshold, which is the ATR multiplied by the user-defined factor.
3. Conditional Coloring:
• If the Candle’s Range ≥ (ATR * Factor):
• The candle is marked as a “signal candle.”
• Its color is set to green if it is an up candle (close is greater than or equal to open) or red if it is a down candle.
• Otherwise:
• The candle retains its classic look, with up candles in white and down candles in black.
4. Chart Display:
By applying these rules to every candle, the indicator visually emphasizes those moments when the market shows unusually large price movements relative to its recent average volatility. This helps traders quickly spot potential breakouts or reversals.
⸻
Practical Applications
• Volatility Breakouts:
Identify candles that may signal the start of a breakout or strong reversal.
• Risk Management:
Adjust stop-loss levels or position sizes when unusually volatile candles are detected.
• Signal Confirmation:
Combine with other technical indicators or chart patterns to reinforce entry or exit decisions.
⸻
ATR Impact Candles is your essential, no-nonsense tool for filtering out market noise and focusing solely on significant price action. Simplify your trading decisions and harness the power of volatility with one clear, effective indicator.
You don’t need dozens of cluttered indicators to catch what really matters. With ATR Impact Candles, you get a powerful, single-tool solution that cuts through the noise by focusing on what truly drives the market: price action and volatility. This indicator highlights only those candlesticks that pack a punch—showing you when the market’s range is exceptionally strong relative to its recent behavior. Whether you’re a scalper or a swing trader, ATR Impact Candles empowers you to time your entries and exits with confidence, letting you trade based on real market momentum.
⸻
Indicator Overview
The indicator is designed for TradingView and is implemented in Pine Script (version 5). Its primary purpose is to highlight specific candles that meet a defined volatility condition based on the Average True Range (ATR). Instead of modifying every candle’s appearance, the indicator only changes the color of those “signal” candles that exceed a user-defined multiple of the ATR. The rest of the candles remain in their traditional black and white appearance—preserving the classic candlestick chart look.
⸻
Key Features
1. ATR-Based Signal Identification:
• ATR Calculation:
The indicator calculates the ATR using a configurable lookback period (default is 14 periods). The ATR is a common volatility measure that reflects the average range of price movement.
• Threshold Condition:
A candle is flagged as a signal if its range (high minus low) meets or exceeds a specified multiple (the “ATR Factor”) of the ATR. By default, this factor is set to 2, meaning any candle whose range is at least twice the ATR is considered significant.
2. Dynamic Candle Coloring:
• Signal Candles:
• When a candle meets the ATR threshold condition:
• Up Candles: are colored green.
• Down Candles: are colored red.
• Non-Signal Candles:
• Candles that do not meet the threshold condition retain their classic appearance:
• Up candles are white.
• Down candles are black.
3. User Configurability:
• ATR Period:
Traders can adjust the ATR period to tailor the volatility measure to different markets or timeframes.
• ATR Factor:
The multiple of the ATR that defines a signal candle is also configurable, giving flexibility to experiment with different thresholds for what constitutes “significant” price movement.
• Overlay Display:
The indicator runs in overlay mode on the chart, meaning it directly affects the appearance of the candlestick bars without interfering with other chart elements.
4. Additional Visual Aid:
• Threshold Line Plot:
The script optionally plots a line representing the ATR multiplied by the chosen factor. This line serves as a visual benchmark on the chart, allowing traders to see at what level the ATR threshold lies relative to the price action.
⸻
How It Works
1. ATR Calculation:
The indicator first calculates the Average True Range (ATR) for the defined period. This value is updated for each new candle.
2. Range Comparison:
For each candle, the indicator calculates the range (high - low) and compares it to the threshold, which is the ATR multiplied by the user-defined factor.
3. Conditional Coloring:
• If the Candle’s Range ≥ (ATR * Factor):
• The candle is marked as a “signal candle.”
• Its color is set to green if it is an up candle (close is greater than or equal to open) or red if it is a down candle.
• Otherwise:
• The candle retains its classic look, with up candles in white and down candles in black.
4. Chart Display:
By applying these rules to every candle, the indicator visually emphasizes those moments when the market shows unusually large price movements relative to its recent average volatility. This helps traders quickly spot potential breakouts or reversals.
⸻
Practical Applications
• Volatility Breakouts:
Identify candles that may signal the start of a breakout or strong reversal.
• Risk Management:
Adjust stop-loss levels or position sizes when unusually volatile candles are detected.
• Signal Confirmation:
Combine with other technical indicators or chart patterns to reinforce entry or exit decisions.
⸻
ATR Impact Candles is your essential, no-nonsense tool for filtering out market noise and focusing solely on significant price action. Simplify your trading decisions and harness the power of volatility with one clear, effective indicator.
Script open-source
In pieno spirito TradingView, il creatore di questo script lo ha reso open-source, in modo che i trader possano esaminarlo e verificarne la funzionalità. Complimenti all'autore! Sebbene sia possibile utilizzarlo gratuitamente, ricorda che la ripubblicazione del codice è soggetta al nostro Regolamento.
Per un accesso rapido a un grafico, aggiungi questo script ai tuoi preferiti: per saperne di più clicca qui.
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 open-source
In pieno spirito TradingView, il creatore di questo script lo ha reso open-source, in modo che i trader possano esaminarlo e verificarne la funzionalità. Complimenti all'autore! Sebbene sia possibile utilizzarlo gratuitamente, ricorda che la ripubblicazione del codice è soggetta al nostro Regolamento.
Per un accesso rapido a un grafico, aggiungi questo script ai tuoi preferiti: per saperne di più clicca qui.
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.