Signalgo CHoCH

Signalgo CHoCH: Informative Technical Overview
Signalgo CHoCH is a multi-factor indicator designed for TradingView to detect “Change of Character” (CHoCH) shifts in market structure, signaling significant trend reversals and managing trades with risk control. This documentation details how it operates, its customizable parameters, signal methodology, what makes it different from traditional tools, and typical strategy applications.

How Signalgo CHoCH Works
1. Market Structure Detection
Swing High & Low Identification: The indicator uses an adaptive swing length to isolate important pivot highs and lows in price action. These pivots signal points where the market reversed direction or paused, forming the “swing structure” core to this strategy.

Body Strength Validation: Not every pivot break is meaningful. Signalgo CHoCH assesses price bar “body strength”—quantifying if the current candle’s body is disproportionately large compared to a recent average—to filter out weak or indecisive moves, retaining only those breaks likely to indicate genuine momentum.

2. Change of Character (CHoCH) Signal Logic
Bullish CHoCH: Triggered when price closes above the last significant swing low (the most recent support) with a strong candle body, indicating a transition from bearish to bullish market structure.

Bearish CHoCH: Triggered when price closes below the last significant swing high (key resistance) with a strong bearish candle, denoting a shift from bullish to bearish structure.

One-Time Event Recognition: Each break is tracked so that signals are issued only once per directional change, reducing repeated or redundant entries.

3. Higher Timeframe Confirmation
Multi-Timeframe Consistency: The indicator requires the CHoCH signal (on the current trading timeframe) to be confirmed by the market structure status of a selected higher timeframe. This adds an extra layer of validation, ensuring the signal aligns with broader trends.

Inputs
SwingLen: The number of bars used to define swing pivots.

bodyStrength & bodyLookback: Control sensitivity for body size validation, filtering which candle breaks are considered strong enough for signaling.

htfTf: Selects the higher timeframe for multi-timeframe checking.

show_tpsl: Toggle to show/hide automated Take Profit (TP) and Stop Loss (SL) levels on the chart.

ATR, TP/SL/RR/Trailing Settings: Determines how risk and reward are managed, using ATR for stop placement and multi-level profit targets with optional trailing stop activation after TP1.

Entry & Exit Strategy
Entry Logic

Long Entry: When a bullish CHoCH is detected, optionally confirmed by the higher timeframe, it marks a buy opportunity at the close of the breakout candle.

Short Entry: When a bearish CHoCH forms, also with optional higher timeframe confirmation, it identifies a sell entry at the close of the confirmation candle.

Exit & Trade Management

Stop Loss (SL): Automatically placed at a set ATR distance from entry, dynamically adapting to volatility.

Take Profits (TP1, TP2, TP3): Multiple reward targets are calculated and marked for systematic scaling out or profit-taking, based on a defined risk multiple.

Trailing Stop: Once the first profit target is hit, SL moves to breakeven, and a trailing stop engages, incrementally securing further gains if the trend continues.

State Tracking: All TP, SL, and trailing events are labeled on the chart for easy post-trade analysis.

Body Strength and Trend Filtering: Breakouts are only considered if the candle’s body confirms significant momentum, not just a fleeting spike, improving signal quality.

Event-Driven, Not Rolling: Each bullish or bearish “character change” is signaled only at the true point of structural shift, with strict per-event marking, not continuous signal generation as with typical MA cross strategies.

Integrated Multi-Timeframe Logic: higher timeframe validation minimizes false positives from short-term volatility noise, a capability not found in most indicator-based tools.

Automated, Dynamic Trade Management: This indicator overlays a complete trade management suite (TPs, SL, trailing) that moves with market conditions, allowing for risk handling directly from each signal.

Trading Strategy Application
Trend Reversal & Continuation: Suitable for identifying both sudden reversals and structural continuations, adaptable for intraday, swing, or positional trading styles.

Noise Filtering: Multiple checks (body strength, momentum, multi-timeframe) focus signals on genuine trend changes, filtering out most “whipsaws” seen in pure MA systems.

Visual Feedback: All transitions, TPs, SLs, and trailing events are visually annotated, enhancing the educational and review process.