ABC Pullback Pattern

The ABC Pullback Pattern is a NinjaTrader 8 trading indicator designed to identify high-probability pullback entries following a Donchian Channel breakout. It detects setups where price retraces after a new swing high or low, forming an alternating body color pattern (ABC) that reflects weakening counter-pressure.

To qualify, the pullback must occur within a specific number of bars, maintain controlled structure (body/bar ratio, breakout range, and trend bar limits), and offer a favorable risk-reward ratio, validated with ATR and tick-based distance filters. The trader can choose between Market execution or BarBreakout mode, where a breakout of the setup confirms the trade within a defined validity window.

This indicator is ideal for momentum traders looking to time trend continuation entries with strong confluence and low structural risk.

Key Features

• Donchian Channel Breakout Detection: Anchors signals to fresh highs or lows.
• Alternating Body Color Filter: Validates pullbacks based on color alternation patterns.
• Pullback Structure Filters: Controls pullback quality via min/max bars, bar behavior, and shape.
• Distance Filters: Ensures entry is neither too close nor too far from breakout using ATR and ticks.
• Risk-Reward Validation: Filters setups based on minimum and maximum R:R using structure-based stops.
• Execution Mode: Trade on pattern formation (Market) or delayed confirmation (BarBreakout).
• Signal Validity: Supports multi-bar confirmation for slow markets.

Tips for Implementation

• Strategic Alignment: Use in trending markets. Confirm with moving averages or higher timeframe bias.
• Pullback Quality: Tighten MaxTrendBarsInPullback and MinBodyToBarRatio for sharper entries.
• Volatility Control: Adjust ATRPeriod and distance filters to normalize across instruments.
• Execution Logic: Use BarBreakout in slow markets, Market in fast-moving setups.
• Backtesting: Tune parameters across market conditions for robustness and consistency.

• DC Period
  Type: int
  Description: Defines the period for the Donchian Channel used to detect breakout structure.
  Default Value: 5
  Valid Values: 1 to any positive integer
• Min Pullback Bars
  Type: int
  Description: Minimum number of bars required to form a valid pullback after the Donchian breakout.
  Default Value: 1
• Max Pullback Bars
  Type: int
  Description: Maximum number of bars allowed to form the pullback. Filters out wide or sluggish retracements.
  Default Value: 5
• Max Trend Bars In Pullback
  Type: int
  Description: Maximum number of pullback bars that move in the direction of the original breakout.
  Default Value: 2
• Max Breaks Prev Bar
  Type: int
  Description: Maximum number of pullback bars allowed to break the previous bar’s high (long) or low (short).
  Default Value: 1
• Min Body To Bar Ratio
  Type: double
  Description: Minimum average ratio of body size to total bar range in the pullback.
  Default Value: 0.1

• Min Distance Ticks
  Type: int
  Description: Minimum distance (in ticks) from the setup to the Donchian breakout level.
  Default Value: 1
• Max Distance Ticks
  Type: int
  Description: Maximum distance (in ticks) allowed between the setup and the breakout level.
  Default Value: 1000
• Min Distance ATR
  Type: double
  Description: Minimum allowed distance between the setup and the breakout level, measured in ATR multiples.
  Default Value: 0.0
• Max Distance ATR
  Type: double
  Description: Maximum allowed distance between the setup and the breakout level, measured in ATR multiples.
  Default Value: 5.0
• ATR Period
  Type: int
  Description: Period used for ATR calculation to normalize distance filters and risk-reward evaluation.
  Default Value: 14
• Min RR Ratio
  Type: double
  Description: Minimum risk-reward ratio required from setup to target, assuming a stop just below/above the setup zone.
  Default Value: 0.8
• Max RR Ratio
  Type: double
  Description: Maximum allowed risk-reward ratio, avoiding setups with impractically distant targets.
  Default Value: 5.0

• Confirmation Candle
  Type: bool
  Description: If enabled, a setup is only confirmed when followed by another candle of the same body color.
  Default Value: true
• Setup Type
  Type: enum (Market, BarBreakout)
  Description: Defines how the trade is confirmed—immediate on pattern completion (Market) or on breakout of setup level (BarBreakout).
  Default Value: BarBreakout
• Setup Validity Bars
  Type: int
  Description: For BarBreakout setups, defines how many bars the setup remains valid before expiring.
  Default Value: 3
• Plot Offset (Ticks)
  Type: int
  Description: Vertical offset for the triangle plot markers in ticks. Helps avoid overlap with candles.
  Default Value: 5

• IndicatorSignalUp
  Type: Plot
  Style: Triangle Up
  Color: Green
  Description: Plots a green triangle below the bar when a valid bullish signal is confirmed.
• SignalUpUpperLevel
  Type: Plot
  Style: Hash
  Color: Green
  Description: Displays the bullish entry level for a valid long setup.
• SignalUpLowerLevel
  Type: Plot
  Style: Hash
  Color: Green
  Description: Displays the stop level for the long setup.
• BreakoutHighLevel
  Type: Plot
  Style: Hash
  Color: DeepSkyBlue
  Description: Plots the Donchian breakout high used as the bullish target level.
• IndicatorSignalDown
  Type: Plot
  Style: Triangle Down
  Color: Red
  Description: Plots a red triangle above the bar when a valid bearish signal is confirmed.
• SignalDownUpperLevel
  Type: Plot
  Style: Hash
  Color: Red
  Description: Displays the stop level for the short setup.
• SignalDownLowerLevel
  Type: Plot
  Style: Hash
  Color: Red
  Description: Displays the bearish entry level for a valid short setup.
• BreakoutLowLevel
  Type: Plot
  Style: Hash
  Color: DeepSkyBlue
  Description: Plots the Donchian breakout low used as the bearish target level.