The Supertrend indicator combines ATR and price to produce trailing support or resistance. When the Supertrend line flips from above to below price or vice versa, it suggests a potential trend change. This strategy trades those flips.
On each candle an ATR-based calculation updates the Supertrend level. A switch from above price to below triggers a long entry, while a move from below to above creates a short. The code sample omits explicit stops, so exits are discretionary or managed by a separate risk module.
The indicator can react quickly to volatility, so traders often combine it with additional filters to reduce whipsaws.
Entry Criteria: Supertrend switches sides relative to price.
Long/Short: Both.
Exit Criteria: Manual or external stop.
Stops: Not defined.
Default Values:
Period = 10
Multiplier = 3.0
CandleType = 15 minute
[*]Filters:
Category: Trend following
Direction: Both
Indicators: Supertrend
Stops: Optional
Complexity: Basic
Timeframe: Intraday
Seasonality: No
Neural networks: No
Divergence: No
Risk level: Medium