Reversal Repeated Pattern

Reversal Repeated Pattern

Description

The Reversal Repeated Pattern indicator for NinjaTrader 8 identifies and signals potential market reversals based on the detection of repeated bar patterns. It skips the first identified pattern and only acts on the subsequent, repeated pattern. This approach helps traders capture signals that may indicate stronger trend reversals by confirming initial conditions with a follow-up pattern. The indicator tracks consecutive price movements and fair value gap (FVG) conditions, signaling when all parameters align. It also incorporates risk-reward analysis to ensure the signals meet minimum criteria before being plotted on the chart.

Key Features

  • Repeated Pattern Recognition: Detects sequences of consecutive bars that meet predefined criteria, triggering a signal only when a repeated pattern is observed.
  • Fair Value Gap Analysis: Integrates FVG detection to enhance pattern validation, ensuring price action supports potential reversal points.
  • Configurable Validity and Conditions: Offers customization of parameters such as the number of consecutive bars (Consecutive), FVG count, signal validity period (ValidityBars), and the option to allow signals beyond extreme prices.
  • Risk-Reward Assessment: Evaluates the potential risk-reward ratio (Min R) before confirming and plotting a signal.
  • Visual Signal Plots: Marks potential long and short reversal signals on the chart with blue triangles and corresponding hash marks for upper and lower levels.

Tips for Implementation

  • Parameter Adjustment: Modify the Consecutive and FVG parameters to tailor the pattern recognition to different trading styles and market conditions. A higher number may filter out weaker patterns.
  • Risk Management: Use the Min R parameter to set a minimum risk-reward threshold for trade validation, aligning with your strategy's risk tolerance.
  • Confirmation Strategy: Integrate this indicator with other trend-following or momentum tools to confirm signals before acting on them.
  • Backtesting: Perform thorough backtesting and optimization to ensure the indicator's parameters are suitable for your chosen asset and timeframe.

Parameters

Consecutive:

  • Type: int
  • Description: Number of consecutive bars required to form a valid pattern.
  • Default Value: 3
  • Valid Values: Any positive integer

FVG:

  • Type: int
  • Description: Minimum number of fair value gaps required to validate the pattern.
  • Default Value: 2
  • Valid Values: Any positive integer

Validity Bars:

  • Type: int
  • Description: The number of bars within which a signal remains valid after being triggered.
  • Default Value: 20
  • Valid Values: Any positive integer

Allow Beyond Extreme:

  • Type: bool
  • Description: Allows the signal to remain valid even if the current price surpasses the extreme price level of the identified pattern.
  • Default Value: true
  • Options: true (Yes), false (No)

Min R:

  • Type: double
  • Description: The minimum acceptable risk-reward ratio for a trade to be considered valid.
  • Default Value: 0.5
  • Valid Values: Any positive double

Plot Offset (Ticks):

  • Type: int
  • Description: The distance (in ticks) between the plotted signal and the bar's high or low, used to improve visual clarity on the chart.
  • Default Value: 5
  • Valid Values: Any positive integer

Plots

ndicatorSignalUp:

  • Type: Plot
  • Style: Triangle Up
  • Color: DeepSkyBlue
  • Description: Indicates a potential long reversal signal.

SignalUpUpperLevel:

  • Type: Plot
  • Style: Hash
  • Color: DeepSkyBlue
  • Description: Marks the upper level associated with a potential long reversal signal.

IndicatorSignalDown:

  • Type: Plot
  • Style: Triangle Down
  • Color: DeepSkyBlue
  • Description: Indicates a potential short reversal signal.

SignalDownLowerLevel:

  • Type: Plot
  • Style: Hash
  • Color: DeepSkyBlue
  • Description: Marks the lower level associated with a potential short reversal signal.