Narrow Range + Inside Day, Short Only Strategy (by ChartArt)

22 oct 2016

This short only strategy determines when there is both a NR7 (narrow range 7, a trading day in which the range is narrower than any of the previous six days), plus a inside day (high of the current day is lower than the high of the previous day and the low of the current day is higher than the low of the previous day) both on the same trading day and enters a short trade when the close is lower than the open and the slope of the simple moving average is downwards, too.

The strategy closes the short trade next time the daily close is lower than the open in any of the next trading days. In addition the NR7ID can be colored (the color is red when the close is lower that day than the open, else the color is green) and the SMA can be drawn with a color based on the direction of the SMA slope. To fine-tune the strategy it is highly recommended to change the period length of the SMA, which determines if the measured SMA slope is downwards or not. In this version 1.1 I made a small change to long only version. By default only the bearish NR7ID days are colored.

Inspiration:
How to trade NR7 and Inside Day Pattern
paststat.com/blog/how-to-trade-nr7-and-inside-day-pattern-on-spy/

Code credit:
NR7 indicator script from Tradingview user Lazybear:
pastebin.com/JR0hLdwq

P.S. You can find the 'long only' version of this trading strategy here: