Technical Studies Reference


Three Line Break Chart

A Three Line Break chart displays boxes using only the Last/Close prices of the underlying bars in the chart. Only the Last/Close prices are used. Not the High or Low. Although with the Input Data Input you can select another bar element instead, such as an Average Price.

If an underlying bar Last price exceeds the current bar box High price, a new Uptrend box is drawn. The opening price of the new box is the same as the previous box close price unless the Show Real Open Input is set to Yes.

If the Last price exceeds the current bar box Low price, a new Downtrend box is drawn. The opening price of the new box is the same as the previous box close price unless the Show Real Open Input is set to Yes.

Nothing happens if the Last price is within the current bar box High and Low price.

If there is a consecutive number of boxes in the same direction, Uptrend or Downtrend boxes, then the Last price must go below or go above the lowest price or highest price respectively, of the specified number of consecutive boxes for a new box to be drawn. The number of consecutive boxes is specified with the Consecutive Boxes to Break (n) Input. Otherwise, if the number of consecutive boxes is less than the specified number (Consecutive Boxes to Break (n) Input), the Last price only needs to go below or go above the lowest price or the highest price respectively, of only the current bar box to make a new box unless the Must Break Consecutive Boxes < n is set to Yes.

For example, if Consecutive Boxes to Break (n) is set to 3, and the last 3 boxes are all Downtrend boxes, then in order for a new Uptrend box to be drawn, the underlying bar Last trade price must be higher than all 3 Downtrend boxes.

The Three Line Break chart draws the final box as live data is received. The final live box could be either an up or down box, and is not determined until the box is complete. The final box is never removed, but the Open value of the box can change when the box is closed based on the Show Real Open Input.

This study can be applied to both Intraday and Historical daily charts. The period of the underlying bars can be any period. Although bars of a very short duration, such as under 10 seconds, would create the most accurate chart. You may want to use a longer time period per bar for different results.

Inputs

  • Input Data
  • Consecutive Boxes to Break (n): The number of consecutive boxes in the same direction that have to be exceeded to start a new box.
  • Must Break Consecutive Boxes < n: If this Input is set to Yes, then the Last price must exceed the High or Low of consecutive Uptrend or Downtrend boxes that are less than the number specified with Consecutive Boxes to Break (n). If this Input is set to No, then only the High or Low level of the prior box needs to be exceeded to start a new box.
  • Show Real Open: This Input affects how a box displayed. When this Input is set to No, a classic Line Break box is displayed, by setting the previous Close. In this case, the true Open value can still be accessed in the True Open Subgraph. When this Input is set to Yes, the open value of the Line Break box is set to the true open, which may distort the Line Break box, but allows the true Open value to be observed. In this case, the Line Break Open value can be accessed in the Line Break Open Subgraph.

Graph Draw Type

Any Graph Draw Type can be used. The typical Graph Draw Types are given below. To set the Graph Draw Type, open the Study Settings window for the Three Line Break Chart study. Go to the Subgraphs tab. Change the Graph Draw Type setting.

  • Candlestick: When this Graph Draw Type is used, the classic Line Break box is represented by the Candlestick body, and the Candlestick wicks will represent the High/Low data that falls outside the Line Break box.
  • Candlestick Body Only: When this Graph Draw Type is used, a classic Line Break box is drawn using the Open and Close values of the bar. The High and Low values are still present in High and Low Subgraphs, but are not displayed. The values can still be used in ACSIL and with the Stritch it studies. The values are also visible in the Window >> Chart Values Window.

*Last modified Friday, 21st April, 2017.