There is a for long positions and one for short positions. The (long) hangs three ATR values below the 22-period high. This means it rises and falls as the period high and the ATR value changes. The for short positions is placed three ATR values above the 22-period low. The spreadsheet examples show sample calculations for both.
According to the theory, traders should exit long positions at either the highest high since entry minus 3 ATRs .
Similarly traders should exit short positions at either the lowest low since entry plus 3 ATRs .
Developed by Charles Beau and featured in Alexander Elder's books, the sets a trailing stop-loss based on the (ATR). The indicator is designed to keep traders in a trend and prevent an early exit as long as the trend extends. Typically, the will be above prices during a downtrend and below prices during an uptrend.
The author, Chuck LeBeau explains: It lets "... profits run in the direction of a trend while still offering some protection against any reversal in trend."
The exit stop is placed at a multiple of average true ranges from the highest high or highest close since the entry of the trade.
will rise instantly whenever new highs are reached. As the highs get higher the stop moves up but it never moves downward.
The is mostly used to set a trailing stop-loss during a trend. Trends sometimes extend further than we anticipate and the can help traders ride the trend a little longer. Even though it is mostly used for stop-losses, the can also be used as a trend tool. A break above the (long) signals strength, while a break below the (short) signals weakness. Once a new trend begins, chartists can then use the corresponding to help define this trend.
Developer: Charles Beau
Author: KıvanÇ @fr3762 on twitter (tweets are only in TURKISH)
Here's the link to a complete list of all my indicators:
Tradingview'a uyarlayan:KıvanÇ @fr3762 twitter
Şimdiye kadar paylaştığım indikatörlerin tam listesi için: https://tr.tradingview.com/u/KIVANCfr376...
YOUTUBE kanalım: Türkçe İndikatör Anlatımları: https://youtube.com/c/KIVANCfr3762