Trendline v5.0

NinjaTrader 8 - NinjaScript - indicator (overlay)

How Trendline v5.0 approaches range-reversal setups

Trendline v5.0 is built around one question: is this market actually going somewhere right now, or is it just drifting? Rather than producing signals in every condition, its default engine deliberately stays quiet while a trend is running and only starts looking for entries once price has flattened out.

To make that judgement the indicator watches four things at once:

• A smoothed, range-based moving average that classifies the market as rising, falling or flat
• RSI - its level, and more importantly the bar on which it turns
• Where price sits inside the high-low range of the last 50 bars
• ATR(14), which sets how far the stop sits and how far the targets are spaced

Trendline v5.0 also ships three alternative engines for traders who prefer to trade with the trend: Mode 1 (pullback onto a stacked EMA set), Mode 2 (the bar three EMAs first stack in order) and Mode 3 (a fast/slow crossover calculated on RSI). Mode 4 is the default and is the mode this manual focuses on.

The result is a smaller number of more selective reversal signals on NinjaTrader 8, each one arriving with an Entry, a Stop Loss and up to three Take Profit levels already drawn on the chart, plus a live performance dashboard in the top-right corner.

Understanding the Sentiment Range MA

The Sentiment Range MA is the component that decides whether Trendline v5.0 is allowed to trade at all. It is a stepped average that holds its value while price stays inside an ATR-sized band and only re-centres when price pushes out of that band. Because it moves in steps rather than tracking every tick, its slope is a clean read on whether the market is genuinely trending or simply oscillating.

What it looks like on the chart:

• The Sentiment Range MA is never drawn as a line - it is expressed through candle colour, so the chart stays clean
• Rising average -> uptrend candles - falling average -> downtrend candles - flat average -> sideways candles
• The flat state is the one that matters: it marks stretches where price is rotating inside a range instead of advancing
• Candle colouring always comes from this Mode 4 average, even when you switch the indicator to Mode 1, 2 or 3 (turn it on with Use Bar Trend Color)

This is where a lot of traders go wrong. An oversold RSI reading feels like a buying opportunity in any market, so reversal signals get taken in the middle of a strong downtrend - where oversold simply means the trend is working. Trendline v5.0 removes that temptation by refusing to generate Mode 4 signals while the average is rising or falling.

How the Sentiment Range MA is defined

The pieces that build it, and what each one contributes:

• Wick-based candle range (high to low), smoothed over 5 bars - establishes the top and bottom edge the average reacts to
• Band width = average candle range over 200 bars x 8 - sets how far price must travel before the average is allowed to move
• Stepped anchor - the average re-centres on close only when the smoothed top or bottom breaks outside the current band, which is what removes the noise
• Double smoothing (a 27-period weighted average applied on top of a simple average) - produces the final, gently curving output
• Slope test against a small threshold - converts that output into the three states: rising, falling, or flat
• RSI(14), shifted by the Sensitivity setting - supplies the actual reversal trigger once the flat state is confirmed
• 50-bar high-low range - provides the top and bottom zones that a signal must occur in
• ATR(14) - used only for stop distance and target spacing, not for signal logic

When trading opportunities appear

In the default Mode 4, a BUY is printed only when all of the following are true on the same bar:

• The previous bar's RSI closed below 32
• That RSI reading was lower than the reading two bars ago - momentum was still falling
• The current RSI has turned back up above the previous bar's value
• Price is sitting in the bottom 30% of the last 50 bars' range
• The Sentiment Range MA is flat (sideways candles)
• At least 10 bars have passed since the last BUY

A SELL is the exact mirror: previous RSI above 68, higher than two bars ago, current RSI turning back down, price in the top 30% of the 50-bar range, flat Sentiment Range MA, and 10 bars since the last SELL.

On the chart the entry is marked by a green up arrow below the bar for a BUY and a red down arrow above the bar for a SELL. Read the arrow together with the RSI turn and the candle colour that produced it - that is the reason the signal fired.

Before a raw signal becomes a printed one it still has to clear the shared filters:

• Cooldown - a further 10-bar gap is enforced after every printed signal, in every mode
• Stability Mode (off by default) - blocks new re-entries while a trade is still being tracked, for cleaner execution
• Smart Signal Filter (off by default) - forces signals to alternate, so a BUY cannot follow a BUY
• Session filter (off by default) - when enabled, new signals are only allowed inside the bar-time window you set (default 07:00-18:00), so the tool can sit out quiet or unwanted hours
• Follow Trend (off by default) - permits BUY only above the 200 EMA with RSI(14) over 50, and SELL only below it with RSI under 50. Note that switching this on works against Mode 4's mean-reversion character
• Multi-timeframe filter - applied to Modes 1-3 only; Mode 4 skips it because the Sentiment Range MA already performs that job

The trade plan drawn on every signal

Every printed signal draws its own levels. Entry is the close of the signal bar. The stop sits ATR(14) x 2.8 away from entry (the SL Distance setting), and each target is a multiple of that risk: TP1 at 1R and enabled by default, TP2 at 2R and TP3 at 3R available but switched off. With TP2 or TP3 turned on, a breakeven stop activates once TP1 is reached. Any trade still open after 200 bars is closed out at the current price.

On the chart this shows up as horizontal lines projected forward from the signal bar:

• Entry line (solid, grey by default) - the close of the signal bar
• SL line (red) - the ATR-based stop
• TP1 / TP2 / TP3 lines (green) - only the enabled targets are drawn
• Each line turns dashed the moment its level is hit, so a glance tells you what has already been reached and what is still pending

The performance dashboard

New in v5.0, a compact dashboard sits in the top-right corner and refreshes on the latest bar. It reports:

• Bias - BULLISH / BEARISH / NEUTRAL, read from the Sentiment Range MA trend state
• Profit Factor - gross profit divided by gross loss across the tracked trades
• Win Rate - percentage of tracked trades that reached a target (breakeven counts as a half-win)
• Sensitivity - the current Sensitivity setting
• Trades - how many simulated trades fell inside the lookback

Statistics are computed only over the last Calculate Bars bars, so the numbers reflect recent behaviour rather than the whole chart history.

Inputs

Property names below match the indicator settings exactly.

Basic Settings

• Sensitivity (default 5): Shifts the RSI length and EMA lengths; lower is quieter, higher is more reactive
• Signal Strength (default 0): 0 uses the chart timeframe; higher values compute the Sentiment Range MA on a proportionally higher timeframe
• Strategy Mode (default Mode4): Mode1 / Mode2 / Mode3 (trend engines) or Mode4 (default range-reversal engine)
• Enable BB Cloud (default On): Draws the Bollinger cloud overlay (also hides the BB Upper/Lower lines when off)

Colors

• Bull Color (default Green): Colour of the BUY arrow
• Bear Color (default Red): Colour of the SELL arrow
• Use Bar Trend Color (default Off): Colours the price bars by the Sentiment Range MA trend state

Risk Management

• Stability Mode (default Off): Prevents rapid re-entries to keep execution clean
• Smart Signal Filter (default Off): Forces signals to alternate, blocking a repeat in the same direction

Trend Bias

• Follow Trend (default Off): Aligns signals with the 200-EMA / RSI trend (works against Mode 4's mean-reversion character)

Session

• Use Session Filter (default Off): Only allow new signals inside the trading window
• Session Time (default 0700-1800): The window used when the filter is on, format HHMM-HHMM (bar time); overnight windows are supported

Take Profit / Stop Loss

• Enable TP/SL/Entry (default On): Draw Entry, SL and TP lines and track simulated trades for the dashboard
• SL Distance (ATR x) (default 2.8): ATR multiplier used to size the stop loss
• Enable TP1 (default On): Enable the first target
• R:R Ratio TP1 (default 1.0): Risk/reward multiple for TP1
• Enable TP2 (default Off): Enable the second target; breakeven activates after TP1 when this is on
• R:R Ratio TP2 (default 2.0): Risk/reward multiple for TP2
• Enable TP3 (default Off): Enable the third target
• R:R Ratio TP3 (default 3.0): Risk/reward multiple for TP3
• Calculate Bars (default 2000): How many historical bars feed the dashboard statistics
• Show Dashboard (default On): Show the Bias / Profit Factor / Win Rate / Trades panel in the top-right corner
• Entry / SL / TP Line Color (default Grey / Red / Green): Colours of the drawn trade-plan lines

Is Trendline v5.0 right for you?

Trendline v5.0 suits you if you recognise yourself here:

• You trade ranges and reversals rather than chasing breakouts
• You work on intraday to swing timeframes - M15 through H4 is the natural home for the default settings
• You trade liquid instruments that spend real time going sideways: FX majors, gold, index CFDs, large-cap crypto
• You want a defined stop and target on every signal instead of deciding levels in the moment
• You would rather wait for a handful of well-located setups than act on every oversold reading

If you are a pure trend-follower who wants to be in every move, the default mode will feel too quiet - start with Mode 1 or Mode 2 instead.

Trendline v5.0 is deliberately built to say no more often than it says yes. Its value is in the setups it filters out, not the number of arrows it prints.

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Trading involves risk. Signals are analytical tools, not financial advice, and past behaviour does not predict future results.