Stockbee Momentum Burst

The Stockbee Momentum Burst indicator is a bar-coloring tool designed to highlight high-momentum price action through specific percentage-based and dollar-based breakout and breakdown conditions. It provides traders with immediate visual confirmation when an asset exhibits explosive move characteristics combined with volume expansion.

Usage

The indicator colors the chart bars based on the fulfillment of several "Momentum Burst" criteria. Traders can use these color changes to identify potential entry points during trend continuation or early-stage breakouts.

Bullish Scenarios

• 4% Breakout: Highlighted when the price increases by at least 4% from the previous day with volume exceeding the previous session.
• Dollar Breakout: Triggered when the price moves at least $0.90 above the open with specific volume and range requirements.
• Base Bullish Requirements: For a bar to be colored bullish, it must also close higher than the open/previous close, be within the top 30% of its daily range, and follow a day with a relatively tight range (<= 2%).

Bearish Scenarios

• 4% Breakdown: Highlighted when the price decreases by at least 4% from the previous day on expanding volume.
• Dollar Breakdown: Triggered when the price drops at least $0.90 below the open.
• Base Bearish Requirements: Bars must close lower than the open/previous close, be within the bottom 30% of their range, and maintain specific minimum volume thresholds over the last three days.

Details

The script implements logic based on the "Stockbee" methodology, focusing on momentum bursts—days where price and volume expand significantly simultaneously.

Beyond simple price action, the script includes a Momentum Filter based on the relationship between the 7-period and 65-period Simple Moving Averages (SMA). The "TI 65" logic filters signals to ensure they align with the broader trend; for example, bullish signals may only appear when the 7 SMA is at least 5% above the 65 SMA.

Additionally, the indicator includes a Reversal logic that identifies exhaustion points using RSI and specific candle geometry (like long wicks at 5-day lows), plotted as triangles above or below the bars.

Settings

Momentum Burst

• 4% Breakout/Breakdown: Toggles the visibility and color of signals based on percentage moves.
• Dollar Breakout/Breakdown: Toggles the visibility and color of signals based on absolute dollar moves.
• Neutral Color: Defines the color for bars that do not meet the momentum criteria.

Momentum Filter

• TI 65 > 1.05 / < 0.95: Filters the bar coloring to only show bullish or bearish bursts when the trend strength (SMA 7/65 ratio) meets the threshold.
• Linked: When enabled, this overrides other filters to strictly align bullish colors with uptrends and bearish colors with downtrends.

Reversal

• Bullish/Bearish: Toggles the triangle labels for reversal patterns.
• Remove P/V: Removes the strict price and volume requirements for reversal labels, allowing for more frequent signals.
• Label Size: Adjusts the size of the reversal triangles on the chart.

FAQ

How do I use the Momentum Filter?

The Momentum Filter is used to reduce "noise." By enabling the TI 65 filters, you ensure that the highlighted momentum bursts are occurring within an established trend, which can increase the probability of successful continuation.

What are the "Base Requirements" in the script?

These are hardcoded filters that look for "clean" price action, such as closing near the daily high for bullish moves or ensuring the move follows a period of consolidation.

How can I access this tool?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.