Description:
The Chande Kroll Stop is a technical indicator designed to help traders manage their risk by identifying optimal stop loss levels for long and short positions. Developed by Tushar Chande and Stanley Kroll, this indicator utilizes the Average True Range (ATR) to account for an asset’s volatility, ensuring that stop levels are placed at appropriate distances from current price levels.
Input Parameters:
- Length: Number of periods used in the calculation.
- Stop Length: Number of periods used in the calculation for a stop level.
- Multiplier: Used to control the sensitivity of the stop levels
- Offset: The offset value is used to access the data of any candle or indicator concerning the current candle, to access the current candle data it will use the offset value of "0", to access previous candle data "-1" offset value will be used, access data of previous to previous "-2" will be used.
Use Cases:
- Identifying Buy and Sell Signals: A buy signal is generated when the price crosses above both the long and short stop lines, suggesting a potential bullish trend. Conversely, a sell signal is generated when the price falls below both stop lines, indicating a possible bearish trend.
- Detecting Trend Reversals: When the long stop line (green) crosses above the short stop line (red), it may signify the beginning of an uptrend. On the other hand, if the short stop line crosses below the long stop line, it could indicate the start of a downtrend.
This feature can be used in:
- Market Scanner
- Strategy Tester
- Dynamic Alerts
- Multi-Factor Alerts
- Smart Checklist
Do you want to learn more? Check out our Learning Center Article.
May 17, 2024