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Supertrend Filter
Use ATR-based trailing bands to stay with breakouts until volatility says the regime flipped.
Strategy briefing
Understand what this strategy is actually betting on before you touch the parameter panel.
Use category and difficulty as context
Compare before optimizing
Map the strategy to a regime thesis
Read the math as a constraint system
Use parameters to test fragility, not creativity
Learning linkup
Open Learning Hub
Read the model brief like a skeptic
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Strategy families & selection
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Validation & skepticism
Pro Access
Supertrend Filter is part of the expanded Pro strategy library. The guide stays public, but running it in backtest, compare, paper tracking, and source-code view is a Pro capability. Pro currently unlocks 8 additional pre-built strategies.
The Intuition
Supertrend is an ATR-based trailing regime filter. It wraps price in a volatility-adjusted band and flips only when the close breaks through that band. The idea is simple: trend direction should only change when the move is large enough relative to recent range expansion.
Compared with moving-average crossovers, Supertrend adapts its distance from price using ATR. In quiet markets the band sits closer, so the system reacts faster. In turbulent markets the band widens, so the rule avoids treating every volatile swing as a regime break.
The appeal is operational discipline. Once a breakout is in force, the trailing band keeps the position alive until volatility-adjusted evidence says the move failed. That makes it closer to a stop-and-reverse framework than a pure entry signal.
The weakness is familiar to all trend systems: range-bound markets create repeated false breaks. Supertrend is also sensitive to the ATR period and multiplier. Tight settings make it responsive but noisy; wide settings reduce churn but leave more profit on the table during reversals.
The Math
Read this as a compact model summary: what the signal sees, what it ignores, and where fragility can creep in.
ATR(t) = WilderMean(TR, n)
HL2(t) = (High(t) + Low(t)) / 2
Upper(t) = HL2(t) + multiplier × ATR(t)
Lower(t) = HL2(t) - multiplier × ATR(t)
Supertrend = rolling stop-and-reverse band built from Upper/Lower
Signal(t) = +1 if Close(t) > Supertrend(t)
= -1 if Close(t) < Supertrend(t)
Parameters
| Parameter | Type | Default | Description |
|---|---|---|---|
| atr_period | int | 10 | ATR lookback window |
| multiplier | float | 3.0 | ATR multiple used for the trailing bands |
Source Code
Source access for this built-in strategy is included with Pro.
Further Reading
- Seban, O. (2009). Supertrend indicator notes.
- Wilder, J.W. (1978). New Concepts in Technical Trading Systems. Trend Research.
- Perry, J. (2012). Advanced Technical Analysis. Wiley.
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