What it is
The Supertrend indicator is a powerful trend-following tool designed to help traders identify the current market direction. It overlays directly on the price chart, providing clear visual cues for bullish or bearish trends.
How it works
It is calculated using the Average True Range (ATR) and a multiplier. The indicator tracks price volatility to determine support and resistance levels, which shift based on market fluctuations.
Trading signals
- Buy signal: When the indicator closes below the price and turns green.
- Sell signal: When the indicator closes above the price and turns red.
Basic settings
The most common settings include a period of 10 for the ATR and a multiplier of 3. These can be adjusted to suit different timeframes. This tool is for educational purposes only, not financial advice.
