I ran across a video online talking about engulfing candles and proper conditions for entry based on the "right" engulfing candle. The problem with other indicators is that most engulfing candle situations are not good entry points and so the trader is left with sorting through all of these signals to find a low percentage of engulfing patterns that actually warrant trade consideration. This idea could also be applied to other price action candles like the pin bar

Take a look at his simplistic idea:

His arguments are undeniable and the parameters he suggests is what sets everything apart. Here is what we need to measure at every bar (independent of Time Frame).

The downward reversal example:

1. Every bar has an open, close, high, and low. The engulfing candle must first be valid by having a higher high and a lower low. The close must also be lower than the open of the previous candle.

2. Each candle has another parameter that I'm interested in: How many previous candles in a row have a smaller low to high range than the engulfing candle. I.E. The range in the engulfing candle itself has a spread range of 10 pips. How many candles into history are there until we find another candle that has a spread of 10 pips or higher?

3. In the downward reversal situation we want to ask how many bars back until we find a higher high than the engulfing candle itself.

So essentially here are the programmable parameters:

1) Minimum left space - Minimum number of candles to left that do not exceed the engulfing high or low for signal consideration.

2) Minimum candle size sequence - Minimum number of candles in sequence before engulfing candle that do not exceed the range or spread of the engulfing candle

3) Minimum candle spread - High minus Low must be greater than this value to be considered a signal.

Keep in mind any of these requirements could be removed by simply setting the value to zero in the parameter list.

If someone could please make these modifications to this indicator I would be very appreciative

I don't have an MQL4 version of the indicator, perhaps it can be found somewhere else out there. I got this indicator on FF originally. I liked this version because it has push notifications which is definitely something I use all the time.

Thanks!!

Take a look at his simplistic idea:

Inserted Video

His arguments are undeniable and the parameters he suggests is what sets everything apart. Here is what we need to measure at every bar (independent of Time Frame).

The downward reversal example:

1. Every bar has an open, close, high, and low. The engulfing candle must first be valid by having a higher high and a lower low. The close must also be lower than the open of the previous candle.

2. Each candle has another parameter that I'm interested in: How many previous candles in a row have a smaller low to high range than the engulfing candle. I.E. The range in the engulfing candle itself has a spread range of 10 pips. How many candles into history are there until we find another candle that has a spread of 10 pips or higher?

3. In the downward reversal situation we want to ask how many bars back until we find a higher high than the engulfing candle itself.

So essentially here are the programmable parameters:

1) Minimum left space - Minimum number of candles to left that do not exceed the engulfing high or low for signal consideration.

2) Minimum candle size sequence - Minimum number of candles in sequence before engulfing candle that do not exceed the range or spread of the engulfing candle

3) Minimum candle spread - High minus Low must be greater than this value to be considered a signal.

Keep in mind any of these requirements could be removed by simply setting the value to zero in the parameter list.

If someone could please make these modifications to this indicator I would be very appreciative

I don't have an MQL4 version of the indicator, perhaps it can be found somewhere else out there. I got this indicator on FF originally. I liked this version because it has push notifications which is definitely something I use all the time.

Thanks!!

Attached File

Engulfing Bar Alert v1.2_FGB.ex4 13 KB | 849 downloads