This script is designed to perform candlestick analysis:
- Data Retrieval: The script retrieves the opening, closing, high and low candlestick prices of the financial instrument on which it is running.
- Candlestick Categorisation: Classifies each candlestick as bullish, bearish or neutral according to the relationship between its open and close price.
- Amplitude Calculation: Calculates the amplitude of each candlestick (difference between high and low) and calculates the average amplitudes for bullish and bearish candlesticks.
- Highlight Candlestick Identification: Identifies the 5 most significant candlesticks (highest amplitude) for both bullish and bearish candlesticks.
- Report Generation: Creates a report that includes the number of bullish, bearish and neutral candlesticks, as well as the average amplitudes and most significant candlesticks.
- Chart Commentary: Displays the generated report as a commentary on the chart of the financial instrument, allowing the user to easily visualise the analysis performed.
In summary, the script helps traders to understand the distribution and amplitude of candles in a specific period, which can be useful for making informed trading decisions, such as the Take Profit or Stop Loss to be used depending on the timeframe or the specific symbol.
