Price Rejection
Oscillator.
An oscillator that measures price conviction and volume to identify strong price rejections and potential reversals.
Trend continuation when price hits AMAB support zone and PRO no longer indicates over-extended - BTCUSD, 1D
Overview
The Problem
Price often wicks at key levels, but it's hard to tell if a wick is just noise or a genuine rejection with institutional backing. Traditional oscillators don't factor in the conviction of the close relative to the candle's range and volume.
The Solution
The Price Rejection Oscillator combines price conviction (body vs. total volatility) with normalized volume to measure the true strength of a move. It visualizes this intensity through a color-coded heat row, making it easy to spot exhaustion and reversals.
Who It's For
Reversal traders, day traders, and anyone looking to validate support/resistance bounces with volume and price action conviction.
Key Features
Volume-Blended Conviction: Combines candle body proportion with relative volume to measure true market participation.
Dynamic Intensity Limits: Uses ATR-based limits to adapt to current market volatility, preventing false signals in quiet markets.
Multi-Level Intensity Heatmap: Visualizes signal strength across 5 levels (from Entry to Critical) using intuitive color gradients.
Compact Row Display: Designed to be displayed as a single row, allowing multiple oscillators to be stacked without cluttering the chart.
Comprehensive Alerts: Get notified at different stages of rejection intensity, from early entries to critical reversals.
How It Works
Conviction Measurement
The indicator calculates 'conviction' by comparing the candle's body to its total volatility. A large body relative to the wick indicates high conviction.
Volume Normalization
Volume is normalized against the highest volume in the lookback period. The conviction score is then blended with this normalized volume, giving more weight to moves backed by high participation.
Adaptive Thresholds
Instead of fixed overbought/oversold levels, the oscillator calculates dynamic thresholds based on the Average True Range (ATR). The signal's intensity is determined by how many multiples of this threshold it crosses.
How To Use
Quickstart
- Add the Price Rejection Oscillator to your chart.
- Adjust the 'Lookback' period if you want faster or slower reactivity (default is 12).
- Stack it with other row-based indicators by adjusting the 'Show on Row' and 'Total Rows' settings.
- Look for deep color intensities (Level 3 or 4) as signs of strong rejection.
Interpretation
- Dark/Opaque Colors: Indicate strong conviction and high volume. These are prime areas to look for reversals or trend continuation.
- Light/Transparent Colors: Indicate weak conviction or low volume. The market is undecided.
- Color Flips: A change from Bullish (Green) to Bearish (Red) indicates a shift in momentum and potential trend change.
Visual Legend
| Element | Meaning | Interpretation | Common Mistake |
|---|---|---|---|
| Bullish Colors (Green) | Downward price rejection (buying pressure). The darker the green, the stronger the bullish conviction. | Look for long opportunities when deep green appears at support levels. | Buying just because it's green; always confirm with market structure. |
| Bearish Colors (Red) | Upward price rejection (selling pressure). The darker the red, the stronger the bearish conviction. | Look for short opportunities when deep red appears at resistance levels. | Shorting in a strong uptrend just because a light red signal appears. |
| Neutral Color (White/Gray) | Lack of clear conviction or volume. | Market is in equilibrium or chopping. Wait for a clearer signal. | Forcing trades in neutral zones. |
Settings Reference
Main
Style
Alert Types
Signal Changed
Triggered when the overall direction changes between bullish, bearish, or neutral.
Turned Bullish
Triggered when the indicator shifts from bearish/neutral to bullish.
Turned Bearish
Triggered when the indicator shifts from bullish/neutral to bearish.
Bearish Critical
Triggered when bearish conviction reaches the critical intensity threshold.
Bearish Urgent
Triggered when bearish conviction reaches the urgent intensity threshold.
Bearish Active
Triggered when bearish conviction reaches the active intensity threshold.
Bearish Entry
Triggered when bearish conviction reaches the entry intensity threshold.
Bullish Critical
Triggered when bullish conviction reaches the critical intensity threshold.
Bullish Urgent
Triggered when bullish conviction reaches the urgent intensity threshold.
Bullish Active
Triggered when bullish conviction reaches the active intensity threshold.
Bullish Entry
Triggered when bullish conviction reaches the entry intensity threshold.
Frequently Asked Questions
It is designed as a 'heatmap' row to save space. The intensity of the signal is conveyed through color opacity rather than the height of a line or histogram, allowing you to stack multiple indicators cleanly.
It determines the window for calculating the highest volume and the Average True Range (ATR). A lower number makes the indicator more sensitive to recent changes, while a higher number smooths it out for longer-term trends.
Yes, the Price Rejection Oscillator adapts to the volatility and volume of whatever timeframe it is applied to.
Related Indicators
Other indicators that complement Price Rejection Oscillator.
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