Major Bar Engulfing Strategy

Below is a concise overview and step-by-step guide on how to interpret and use the **Major Bar Engulfing Strategy** indicator.

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## 1. Description

The **Major Bar Engulfing Strategy** indicator is designed to identify key turning points (“Major Bars”) and potential trade continuation signals based on higher-timeframe (HTF) and lower-timeframe (LTF) engulfing logic. It helps you see when price has significantly shifted structure at a higher timeframe, and then pinpoints bullish or bearish “engulfing” candles that align with the current trend direction.

### Key Components

1. **Major Bar Detection (HTF)**
- The script tracks a *higher timeframe* high and low (labeled “Major Bar High” & “Major Bar Low” on your chart).
- When the HTF close breaks above the previous Major Bar High, it signals a *new bullish major bar*.
- When the HTF close breaks below the previous Major Bar Low, it signals a *new bearish major bar*.

2. **Trend Direction**
- If a new major bar forms by breaking above the old high, the trend is flagged as “bullish.” Breaking below the old low flags the trend as “bearish.”
- A large triangle (`▲` or `▼`) appears on the bar where the trend flips from bullish to bearish or vice versa.

3. **Bar Coloring**
- **Bullish Major Bar**: Fully bright green (`#00ff72`).
- **Bearish Major Bar**: Fully red.
- **Subsequent Bars After Bullish Major Bar**: Green (`#00ff72`) at 50% transparency.
- **Subsequent Bars After Bearish Major Bar**: Red at 50% transparency.
- This coloring remains until a new major bar changes the trend.

4. **Engulfing Candle Diamonds**
- **Higher Timeframe Engulfing** (HTF) – Green diamond above the candle if bullish engulfing; red diamond below if bearish engulfing.
- **Lower Timeframe Engulfing** (LTF) – Green diamond above the candle if bullish engulfing; red diamond below if bearish engulfing.
- These diamonds help you see when a candle at either timeframe engulfs the previous one in a trend-aligned direction.

5. **Pullback Logic**
- A simple pullback is detected if multiple consecutive bars move against the current trend on the HTF or LTF. Once pullback criteria are met, the next engulfing bar in trend direction is flagged as a signal.

6. **Advanced Retouch Logic** (Optional)
- When enabled, the script checks if the engulfing bar significantly exceeds the previous 2 bar highs/lows and if price “retouches” a certain zone before confirming a final entry signal. This logic is mostly “under the hood” but adds nuance to when final signals appear.

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## 2. How to Use

1. **Add the Indicator to Your Chart**
- In TradingView, open the **Indicators** menu and add the **Major Bar Engulfing Strategy** indicator to any symbol/timeframe chart.

2. **Select Appropriate Timeframes**
- Open the “Settings” of the indicator (gear icon), and specify the **Higher Timeframe** (e.g., 4H) and the **Lower Timeframe** (e.g., 1H).
- Ideally, your **chart timeframe** should be equal to or lower than the Higher Timeframe you set, so the higher-timeframe logic can unfold properly.

3. **Interpret the Major Bar Lines**
- You’ll see two lines on your chart (by default, bright green for “Major Bar High” and red for “Major Bar Low”). These lines represent the *current* HTF structure boundaries.

4. **Look for a Change in Major Bar**
- If the higher-timeframe close goes beyond the Major Bar High or Low, a **new major bar** is declared, and the **bar color** on your chart will fully switch to bright green (bullish) or full red (bearish).
- The indicator also draws a **triangle** (up for bullish, down for bearish) on the exact bar where the overall *trend flips* from up to down or down to up.

5. **Note the Candle Colors**
- The exact bar that changes the major bar to bullish → *fully bright green*.
- The exact bar that changes the major bar to bearish → *fully red*.
- Follow-up bars stay the same color but at 50% transparency, indicating the prevailing trend until a new major bar triggers.

6. **Engulfing Candle Diamonds**
- Diamonds *above* the bar = bullish engulf.
- Diamonds *below* the bar = bearish engulf.
- **HTF Engulf** uses separate conditions from **LTF Engulf** but both display as diamonds (different titles in the input/Style panel).
- When a pullback is detected and then an engulfing candle occurs in the trend direction, you may see these diamonds as potential re-entry or continuation signals.

7. **Advanced Retouch Logic (Optional)**
- If “Use Advanced Retouch Entry Logic?” is enabled in the settings, the script adds stricter engulfing and “retouch zone” checks. While these conditions are not visually distinct except for internal signals, it can influence when final signals are counted as valid. You might see the “Advanced Entry Signal” marker (●) appear on your chart’s lower region.

8. **Customize in the Style Tab**
- Adjust colors, shape sizes, line thickness, and visibility from the **Style** tab in the indicator’s settings. This includes the Major Bar High/Low lines, triangle flip icons, diamond engulf icons, and debug signal markers.

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## 3. Practical Tips

- **Timeframe Alignment**:
- If you set the higher timeframe too large compared to your chart, changes might be infrequent. Consider a ratio like 4:1 or 6:1 (e.g., HTF = 4H, chart timeframe = 1H).
- **Pullback & Engulf Settings**:
- Lower the `Pullback Bar Count Threshold` (e.g., from 3 to 2) or the `Minimum Body % for Engulfing` if you want more frequent detection of signals.
- **Multiple Confirmation**:
- Major Bar color changes, trend-flip triangles, and engulfing diamonds can all combine to give you a sense of structure shifts and potential continuation moves.
- **No Automated Orders**:
- This is an **indicator**, not a strategy; it will not place trades automatically. You can use it for discretionary guidance or integrate the logic into your own trading approach.

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## 4. Disclaimer

This indicator is for **educational** and **informational** purposes only. It does **not** guarantee profitability or success in trading. Always perform your own analysis and risk management. Use at your own discretion.

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**Enjoy monitoring higher-timeframe structure, trend flips, and engulfing setups with the Major Bar Engulfing Strategy indicator!**