Tennis Ball Action

15 בדצמ׳ 2023

Inspired by Mark Minervini's sell rules in "Think and Trade Like a Champion".

• Used to determine if a stock is behaving well after a breakout
  
• Used to determine when it might by prudent to reduce a position or sell
  
• Used as a visual aid, but based purely off price and volume action
  

Here's a breakdown of what each condition checks for:

1. Up Close Counter: Checks for a sequence of upward closes. If there are 12 or more up closes in the last 15 days, it flags up_days as true.
   
2. Upper 50% Range Condition: Determines if 9 or more out of the last 15 closes are in the upper 50% of the price range.
   
3. Bullish Engulfing: Identifies a bullish engulfing candlestick pattern where the close is higher than the previous high and the open is lower than the previous low.
   
4. Stock Up 3% or More: Flags when the stock is up 3% or more on the day.
   
5. Inside Day Condition: Checks if the current day's high is lower than the previous day's high and the current day's low is higher than the previous day's low.
   
6. Close Below 50-day SMA: Indicates a negative confirmation when the stock closes below the 50-day Simple Moving Average (SMA).
   
7. Weak Close Condition: Similar to the Upper 50% Range Condition, but looking for lower closes.
   
8. Close Below 20-day SMA: Another negative confirmation when the stock closes below the 20-day SMA.
   
9. Three Lower Lows: Identifies a pattern where the current close is lower than the previous two closes.
   
10. Down on Above Average Volume: Flags when the stock closes lower than the previous day's close and the volume is higher than the 20-day SMA of volume.
    

The script then tallies up the confirmations and violations based on these conditions and plots them on a histogram. Confirmations are represented in green, violations in red.

This indicator evaluates both bullish and bearish signals based on various technical conditions to assist traders in decision-making. The confirmations suggest potential bullish movements, while violations indicate potential bearish movements in the stock.