Engulfing.pine

// This source code is subject to the terms of the Mozilla Public License 2.0 at https://mozilla.org/MPL/2.0/
// © abdullah2202

//@version=5

indicator(title="Engulfing", shorttitle="Engulfing", overlay=true)

// Identify engulfing candles
bullishEC = close > open[1] and close[1] < open[1] and close[2] < open[2] and close[3] < open[3]
bearishEC = close < open[1] and close[1] > open[1] and close[2] > open[2] and close[3] > open[3]

// Get candle size - If engulfing candle is greater than 2x, dont do.
BullishCZ = ((close - open) / (open[1] - close[1])) < 3
BearishCZ = ((open - close) / (close[1] - open[1])) < 3

// Calculate Wicks
bullishWickUp = high - close
bullishWickDown = open - low
bullishBody = close - open
bearishWickUp = high - open
bearishWickDown = close - low
bearishBody = open - close

// Make sure wicks are smaller than body of candle
bullishWicks = (bullishWickUp < bullishBody) and (bullishWickDown < bullishBody) and (bullishWickUp > 0) and (bullishWickDown > 0)
bearishWicks = (bearishWickUp < bearishBody) and (bearishWickDown < bearishBody) and (bearishWickUp > 0) and (bearishWickDown > 0)


bullishSignal = BullishCZ and bullishEC and bullishWicks
bearishSignal = BearishCZ and bearishEC and bearishWicks

// Plot signals to chart
plotshape(bullishSignal, title="Long", location=location.belowbar, color=color.green, style=shape.triangleup, text="Long")
plotshape(bearishSignal, title="Short", location=location.abovebar, color=color.red, style=shape.triangledown, text="Short")

// Send out an alert if this candle meets our conditions
alertcondition(bearishSignal or bullishSignal, title="Engulfing Trade Alert!", message="Engulfing Signal for XXX")