TREND FAILURE CONFIRMATION Guia de trading
The Trend Failure Confirmation (TFC) indicator is a diagnostic trend-failure oscillator designed to detect the moment when a mature trend stops extending, loses internal efficiency, and starts breaking with actual confirmation. Instead of reacting to a simple line cross, TFC combines trend slope, ATR-normalized extension, candle weakness, and efficiency-ratio decay to measure whether continuation is failing or still healthy.
What does the indicator show?
- TFC Score: The main oscillator line in the range of approximately -100 to 100. Positive values indicate bullish failure pressure against a prior downtrend, while negative values indicate bearish failure pressure against a prior uptrend.
- Signal Line: A smoothed EMA of the TFC score that helps filter raw swings and identify cleaner transitions in failure momentum.
- Confirmation Thresholds: Static upper and lower guide levels that mark the zone where a trend failure is considered fully confirmed rather than merely weakening.
- Bull / Bear Strength Metrics: Internal strategy-ready values measuring how strong a bullish or bearish failure setup is at the current bar.
- Early Exhaustion vs Confirmed Failure: Separate outputs that distinguish between a fading trend and a structurally confirmed failure, which is useful for staged execution logic.
Key Settings
- Trend EMA Length: Controls the main trend baseline used to judge whether price is stretched or starting to fail back through trend.
- ATR Length: Defines the volatility normalization used for extension and break measurements, allowing the indicator to remain adaptive across different instruments.
- Efficiency Length / Smoothing: Regulates how the model evaluates the deterioration of directional efficiency inside the current trend.
- Slope Lookback: Determines how far back the script compares the EMA slope to assess trend acceleration or loss of momentum.
- Extension ATR: Sets how far price must stretch away from the trend baseline before a mature-trend failure setup becomes valid.
- Exhaustion / Confirmation Thresholds: Defines the boundary between an early warning state and a true confirmed trend-failure event.
How to use Strategy Parameters (Condition Source)
Inside the Strategy Builder, TFC is most useful as a confirmation layer for reversal systems, failed continuation setups, or structure-break logic. It is not a blind buy/sell engine by itself; instead, it quantifies whether a trend is genuinely degrading or already failing.
1. Core Oscillator Values
tfc— The main Trend Failure Confirmation score. Positive readings favor bullish failure scenarios; negative readings favor bearish failure scenarios.signal— Smoothed tracking line for crossover or momentum-filter logic.bullStrength/bearStrength— Raw strength values for each failure direction, useful when building threshold-based entry filters.
Strategy Example: A reversal model may require bearStrength >= 70 before allowing any short trigger from a separate structure-break signal.
2. Early Warning Signals
bullExhaust— Fires when a bearish trend starts losing quality and extension, but a full upside failure is not yet confirmed.bearExhaust— Fires when a bullish trend starts fading internally, warning that continuation may be weakening.
These outputs are useful for reducing aggressive trend-following entries late in a move.
3. Confirmed Failure Signals
bullConfirm— Triggers when downward continuation fails and price shows enough evidence of a bullish trend-failure reversal.bearConfirm— Triggers when upward continuation fails and price shows enough evidence of a bearish trend-failure reversal.
Strategy Example: Use bullConfirm = true only when price is also reclaiming a local structure level or closing back above a trend baseline from another indicator.
4. Best Use Case
TFC works best as a decision filter: it helps answer whether the market is merely pulling back or whether the previous trend is truly failing. It pairs especially well with market-structure indicators, divergence tools, or high-timeframe bias filters.