BoQ

What kind of traders/investors are we?

We are trend followers, always on the lookout for the next big move in the market. Our scripts are meticulously crafted for higher timeframes (daily, weekly, monthly) aiming to capture the large market trends.

What does this script do?

Breakout and pullback signals are pivotal for identifying and entering into long-term trends. However, not all signal bars are created equal. The BoQ script is your lens to differentiate between a strong signal and a weak one. When a breakout above our specific Donchian setting occurs, the BoQ steps in to qualify the strength of this breakout, guiding investors and traders on whether to take the signal or not. The beauty of the tool is that the logic can be reversed. Weak breakout signals can be identified as strong pullback signals, allowing early pullback entries into a trend at critical levels of support/resistance.

How is the BoQ produced?

The BoQ is produced by evaluating the closing price in relation to the signal candle's high or low.

• For a bullish breakout signal, if the close is nestled within the top range of the bar, the BoQ histogram displays a green bar for that day, signifying a robust breakout candle.
  
• Conversely, for a bearish breakout signal, a close in the bottom range of the bar will result in a red bar on the BoQ histogram, indicating a strong bearish breakout.
  
• Any candle that closes between the bottom and top range is represented by a grey bar on the histogram, marking it as a weak breakout.
  
• A grey histogram bar doubles up as a pullback signal to identify reversals and the end of trends
  
• A grey histogram bar identifies inside bars, which can be used to identify aggressive pullback entries at major levels of support/resistance.
  
• A red histogram bar can be used to identify conservative pullback entries at major resistance levels.
  
• A green histogram bar can be used to identify conservative pullback entries at major support levels.
  

What is the best timeframe to use the script?

The BoQ is designed for the daily timeframe where breakout and pullback signals demonstrate their reliability. Traders and investors can align themselves with entries into the long-term trend, sidestepping the noise of shorter timeframes.

What makes this script unique?

The BoQ has multiple uses. The script stands out by offering investors a quick and intuitive way to gauge the strength of breakout and pullback bars. Traders and investors no longer need to squint at data windows or closely inspect charts.

• With the BoQ's colour-coded histogram bars conveniently displayed as a subchart, determining a breakout or pullback bar's strength becomes straightforward.
  
• By filtering out weak breakouts, the BoQ ensures investors and traders can filter out and enter high-probability breakout signals.
  
• Weak breakout signals highlight strong pullback signals, allowing traders/investors to apply the right strategy for the right market structure.
  

The BoQ can be used to identify the trend's momentum as:

• A repeated green BoQ histogram confirms a strong bull trend in play.
  
• A repeated red BoQ histogram confirms a strong bearish trend in play.
  

The BoQ can also be applied to bars at the peaks of trends to identify:

• Potential reversal points when the BoQ switches from red/green to grey.
  
• Pullbacks/market reversals when the opposite colour repeatedly appears. For example, green to grey to red means a bull-to-bear reversal and vice versa.
  

The BoQ can also be applied to the range of a bar compared to the previous bar to identify:

• Inside bars at support/resistance levels.
  
• Pullback entry points at critical support/resistance levels.