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This signal was created by Eric Lefort, the famous French author and trader. It enables to take a position when quotes cross a bearish- or horizontal line upwards. This signal is exclusively bullish.
|Category||: Trend reversal and trend resumption|
|Components||: Trend line|
|Time frame(s)||: All|
|Usable for buy signals||: Yes|
|Usable for short sell signals||: No|
This signal seeks to trace black downward- or horizontal trend lines between two peaks on quotes, following precise and configurable criteria. When a trend line is validated, a green line is traced over a certain number of periods.
The parameters are set by default to offer as many trend lines as possible. It is recommended to show the signals on a chart and then to play with the parameters below in order to learn how to select the type of trend line:
|StartTime||: Start of the period of activation of the signal (ex.: 900 for 9 a.m.)|
|EndTime||: End of the period of activation of the signal (ex.: 1845 for 18.45 p.m.)|
|MessageBox||: 1 = send a message when a signal appears|
|PlaySound||: 1 = play a sound when a signal appears|
|SendEmail||: 1 = send an email when a signal appears|
|Smooth||: Number of bars needed to form a peak|
|Mini||: Minimum number of bars between two peaks|
|Maxi||: Maximum number of bars between two peaks|
|Prolong||: Number of bars to form a green line|
|MaxHighInclination||: Maximum inclination of the line|
|MinHighInclination||: Minimum inclination of the line|
|EntryStrategy||: 0 = no entry, 1 = entry if break-out on close, 2 = entry at the close of the candle if the break-out takesplace during the candle|
|DifferEntry||: Entry delayed by this amount of bars|
A buy signal is triggered if the price closes above the green line after an upward cross. A signal is identifiable by the presence of a vertical grey band.
In this example, five trend lines are drawn on the chart. Only the first three trend lines produce buying signals.
We notice that this type of signal allows entering at the foot of a bullish trend reversal (signal #1) and during a bullish progression (signals #2 and #3).
It is also effective to limit losing entries during downward trends (signal#4 et #5).