OPEN-SOURCE SCRIPT
Equity Index Overnight Fakeout
This script highlights when price violates the highest high or lowest low within the user's selected lookback period, with the caveat that it occurs during the GLOBEX session. The script is designed to work exclusively with the trading hours for CME and CBOT Equity Index futures. I'm planning to make a more customizable version down the line.
My reasoning behind this very simple script is that the low liquidity and participation of the overnight session creates a tendency for moves at extremes to mean revert. Let me know what you think.
My reasoning behind this very simple script is that the low liquidity and participation of the overnight session creates a tendency for moves at extremes to mean revert. Let me know what you think.
Open-source script
In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in publication is governed by House rules. You can favorite it to use it on a chart.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.