ATR IMPULSE RETENTION Trading Guide

ATR Impulse Retention measures how much displacement remains after a large candle impulse. Each observation uses the instrument's ATR before that impulse, so a move is assessed relative to its own recent volatility. The indicator summarizes completed observations separately for upward and downward impulses.

What does the indicator show?

• Green solid line: average displacement retained after upward impulses, in ATR.
• Red solid line: average displacement retained after downward impulses, in ATR. A positive red value means that downward progress was retained.
• Matching dashed lines: average initial sizes of the same observed impulses, in ATR.
• Reference lines: zero, one and two ATR. The vertical scale adjusts to actual values.

Both solid lines use the same sign convention: positive means progress remains in the original impulse direction; zero means a full return to its opening price; negative means reversal beyond its opening price. Retention can exceed the initial size when price continues in the impulse direction.

Example: an upward candle body moves 2 ATR. Five candles later, price is 1.2 ATR above its opening price. That observation contributes 1.2 ATR to retention and 2 ATR to initial size. If price instead finishes 0.5 ATR below the opening price, retention is -0.5 ATR.

How is it calculated?

An impulse qualifies when abs(close[j] - open[j]) / ATR[j-1] reaches the configured minimum. ATR uses Wilder smoothing and is fixed before the impulse. A large wick alone does not qualify; volume is not used.

After H subsequent closed candles, upward retention is (close[j+H] - open[j]) / ATR[j-1]; downward retention is (open[j] - close[j+H]) / ATR[j-1]. A later volatility increase cannot rescale this observation.

The observation is published on candle j+H+1. With H=5, the result appears on j+6 after j+5 has closed. It is never moved back to the original impulse candle. Observations published within the configured rolling window are averaged separately by direction, then smoothed.

Key Settings

• ATR Period (14): length of the pre-impulse volatility estimate.
• Minimum Impulse Body (ATR) (1.5): minimum qualifying candle-body size. A higher value selects larger impulses.
• Observe After (Closed Bars) (5): number of completed candles after an impulse before measuring retention.
• Observation Window (Bars) (100): how long published observations remain in the average. This counts chart bars, not a fixed number of impulses.
• Line Smoothing (EMA) (3): smoothing of retained and initial-size lines. Set 1 to display unsmoothed averages.
• Show Initial Impulse Sizes (enabled): displays the dashed comparison lines.

Values are real ATR units and are not bounded to 0-100. Fixed Y is optional; its suggested range is -2 to 5 ATR. Automatic scaling can display values outside that range.

How to use Strategy Parameters (Condition Source)

All condition sources are numeric values. The oscillator does not emit entry signals or manage stop losses.

Retained movement

• upRetained / Up Retained (ATR): smoothed mean retention of upward impulses.
• downRetained / Down Retained (ATR): smoothed mean retention of downward impulses.

Strategy Example: upRetained > 1 and upSamples >= 3 selects windows where upward impulses retained more than one ATR on average and at least three completed upward observations are available. This is a descriptive filter, not an entry trigger.

Initial sizes and observation counts

• upInitial and downInitial: smoothed mean initial sizes of the corresponding observation groups.
• upSamples and downSamples: numbers of completed observations currently included in each rolling group.

Strategy Example: upRetained > upInitial compares retained movement with the initial upward impulse size. It indicates that the smoothed cohort average extended beyond its original size. Observation counts help distinguish a broad sample from a single recent event.

Unsmoothed averages and directional comparison

• upMean and downMean: retained-movement averages before EMA smoothing.
• balance / Up Minus Down (ATR): upRetained - downRetained, available only when both groups have observations.

Strategy Example: balance > 0 with upSamples >= 3 and downSamples >= 3 selects windows where retained upward displacement exceeds retained downward displacement. The groups can have different initial sizes and sample counts.

Reading missing values

A direction without observations in the rolling window has a blank line, not zero. Zero specifically means full retracement. Insufficient history or zero ATR also produces blank measurements. Observations crossing invalid candle data are rejected; new impulses require a recovered valid ATR history.

The current forming candle does not change published values. The indicator describes outcomes of past impulses; overlapping observations are not independent trades or a probability of future profit.