Range Based Signals and Alerts

The Range Based Signals and Alerts indicator provides a rule-based signaling system designed to identify mean-reversion opportunities when price action extends beyond multi-timeframe high and low boundaries.

Usage

The tool is primarily designed for lower timeframes (such as the 5-minute chart) to capture intraday reversals. It generates signals based on the interaction between price, daily (or higher timeframe) ranges, and a customizable moving average.

• Long Signals: Occur when the price is below the higher timeframe low and closes back above the selected Moving Average. If enabled, the MTF MACD must also show a bullish trend.
• Short Signals: Occur when the price is above the higher timeframe high and closes back below the selected Moving Average. If enabled, the MTF MACD must also show a bearish trend.

A built-in conditional checker filters out repeated signals within a short window (7 bars) to ensure the chart remains clean and actionable.

Details

The script combines three core technical components to validate entries:

1. Multi-Timeframe (MTF) Ranges: It identifies significant support and resistance levels by fetching the High and Low from a higher timeframe (defaulting to Daily).
2. Trend Confirmation (MACD): An MTF MACD filter ensures that signals align with the broader market momentum. This helps traders avoid "catching a falling knife" during strong trending moves.
3. Mean Reversion (MA): The Moving Average acts as a dynamic trigger. A signal is only confirmed when price returns from an overextended state (outside the range) and crosses the MA, signifying a potential shift in short-term momentum.

Settings

High-Low MTF

• High-Low MTF: Defines the timeframe used to calculate the range boundaries (High/Low). It is recommended to use a timeframe higher than the current chart.

MA

• MA Type: Select between various moving average types (RMA, SMA, EMA, VWMA, WMA, HMA, LSMA).
• MA Source: The price data used for MA calculation (default is Close).
• MA Length: The lookback period for the moving average.

MTF Macd

• Enable MACD Trend: Toggles the MACD trend filter on or off.
• MACD TF: The timeframe used for the MACD trend calculation.
• MACD Source: The price source for MACD.
• MACD Fast/Slow/Signal: Standard parameters for the MACD oscillator.
• MACD Smoothing Type: The type of moving average used within the MACD calculation.

FAQ

How do I interpret the Range Based Signals and Alerts?

Signals appear when the price deviates outside the specified higher timeframe range and subsequently recovers toward the moving average, provided the broader trend (MACD) aligns with the move.

What timeframes work best for this tool?

While it can be used on various intervals, it is optimized for 5-minute charts using a Daily high-low range to find intraday mean-reversion points.

How can I access this indicator?

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