Three Bar Reversal
"Three bar reversal" is used loosely across trading literature with no single agreed definition, which is how a lot of published versions end up vague about what actually has to happen. This one states its rule plainly. Labelling the newest bar i, the middle bar i+1, and the oldest bar i+2, a bullish reversal requires all three: the middle bar makes a lower low than the oldest bar (the decline is real, not a stall), the reversal bar's close clears the middle bar's high (a decisive move, not a graze), and that close also clears the oldest bar's open (price gives back the whole short move, not just part of it). Bearish is the exact mirror on highs. Because every condition references the reversal bar's close, the signal can only exist once that bar has actually finished - there is no partial or provisional state to repaint away from. Notes and limitations - The pattern needs three fully closed bars, so it never fires on the forming bar and never repaints. - This is a strict three-candle shape test only - it applies no volume, volatility or higher-timeframe trend filter, so it will also fire inside a ranging market where the "reversal" is really just noise. - The exact rule is intentionally stricter than many looser three-bar reversal definitions circulating elsewhere; expect fewer signals than a more permissive version, by design.
Indicator · MT5 · v1.0 · Free
About Three Bar Reversal
Three Bar Reversal is an indicator for MetaTrader 5. It draws buy and sell arrows on the chart and can alert you with a pop-up, sound, email or push message. It has 1 setting, such as Alerts. MQL source code included.
Files in the download: ThreeBarReversal.ex5, ThreeBarReversal.mq5, ThreeBarReversal.txt.
Settings
| Setting | Default | What it does |
|---|---|---|
| Alerts | true | Alert once per closed bar on a new reversal |
How to install
- Download the ZIP from your PolyMaria library and unzip it.
- In MetaTrader 5 open File → Open Data Folder, then go to MQL5 → Indicators.
- Copy the .mq5 file(s) there. Put any .mqh files in MQL5 → Include.
- Open the .mq5 file in MetaEditor and press Compile (F7) if MetaTrader does not show it.
- Drag the indicator from the Navigator onto a chart and adjust the settings.
Tags: Buy/Sell Arrows · Alerts · MT5 Indicator · MQL5 Source Code