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Bearish Wick Reversal

█ STRATEGY OVERVIEW
The "Bearish Wick Reversal Strategy" identifies potential bullish reversals following significant bearish price rejection (long lower wicks). This counter-trend approach enters long positions when bearish candles show exaggerated downside wicks relative to closing prices, then exits on bullish confirmation signals. Includes optional EMA trend filtering for improved reliability.

█ What is a Bearish Wick?
A price rejection pattern where:
  • Bearish candle (close < open) forms with extended lower wick
  • Wick represents failed selloff: Low drops significantly below close
  • Measured as: (Low - Close)/Close × 100 (Negative percentage indicates downward extension)


█ SIGNAL GENERATION
1. LONG ENTRY CONDITION
  • Bearish candle forms with close < open
  • Lower wick exceeds user-defined threshold (Default: -1% of close price)
  • The signal occurs within the specified time window
  • If enabled, the close price must also be above the 200-period EMA (Exponential Moving Average)


2. EXIT CONDITION
  • A Sell Signal is generated when the current closing price exceeds the highest high of the previous seven bars (`close > _highest[1]`). This indicates that the price has shown strength, potentially confirming the reversal and prompting the strategy to exit the position.


█ PERFORMANCE OVERVIEW
  • Ideal Market: Volatile instruments with frequent price rejections
  • Key Risk: False signals in sustained bearish trends
  • Optimization Tip: Test various thresholds
  • Filter Impact: EMA reduces trades but improves win rate and reduces drawdown

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