Trend Line Methods (TLM) — Indie version

Trend Line Methods (TLM) is a professional trendline and channel construction indicator designed for traders who rely on structure, slope, and market geometry rather than lagging oscillators. The indicator provides two complementary analytical methods that help identify dominant trend direction, dynamic support/resistance, and price containment zones.

Reimplementation inspired by Trend Line Methods (TLM) TV indicator by @ata_sabanci

The focus of this version is algorithmic clarity, deterministic behavior, and practical trading use, rather than visual decoration.

How the Indicator Works

TLM operates entirely on price-derived reference points (pivots and segment extremes) and constructs trendlines using explicit geometric rules. No smoothing, averaging, or oscillators are involved.

The indicator offers two independent methods, which can be enabled separately or used together.

Method 1: Pivot Span Trendlines

Concept

Pivot Span trendlines connect the oldest and most recent confirmed pivots to form a structural trendline that represents the market’s current directional bias.

• Pivot highs define descending resistance
• Pivot lows define ascending support

Only confirmed pivots are used, which avoids unstable or forward-looking lines.

How pivots are detected

• A pivot high is confirmed after pivot_right bars
• A pivot low is confirmed after pivot_right bars
• This confirmation delay is intentional and unavoidable in pivot-based logic

Construction logic

1. The indicator stores the most recent pivot_count pivot points
2. The oldest and newest pivots are selected
3. A straight line is calculated using:
   --- slope = Δprice / Δbars
   --- intercept derived from bar index
4. The line is projected across the full lookback window, up to the current bar

Practical use

• Identify the dominant trend direction
• Trade pullbacks toward the pivot trendline
• Detect trend weakening when price fails to respect the line
• Combine with breakout logic when price decisively crosses the line

Notes for traders

• Pivot-based lines may visually update when a new pivot is confirmed
• This is expected behavior and not repainting in the deceptive sense

Method 2: 5-Point Regression Channel

Concept

The 5-Point Channel models price structure using five discrete market segments within a defined lookback window.

Each segment contributes:

• One highest high (upper boundary)
• One lowest low (lower boundary)

These points are then used to construct two independent regression lines:

• Upper regression (resistance)
• Lower regression (support)

Construction logic

1. The lookback range is divided into five sequential segments
2. For each segment:
   -- The extreme high and extreme low are extracted
3. Ordinary Least Squares (OLS) regression is applied separately to highs and lows
4. The resulting lines define a statistical price channel

Practical use

• Identify price containment zones
• Trade mean reversion inside the channel
• Detect trend acceleration when price hugs one boundary
• Spot channel breakdowns as early trend change signals

Why five points?

Five segments offer a balance between:

• Structural stability
• Responsiveness to regime change

This avoids the overfitting typical of full-bar regressions.

How to Use TLM in Trading

Typical workflows

• Trend-following: Use Pivot Span as directional bias, 5-Point Channel for entries
• Breakout trading: Watch for closes outside both pivot line and channel
• Range trading: Use channel boundaries as dynamic support/resistance

Timeframes

• Works on all timeframes
• Higher timeframes produce more stable geometry
• Lower timeframes benefit from reduced pivot counts

Parameter guidance

• Increase pivot_left / pivot_right for cleaner, slower trendlines
• Reduce them for faster, more reactive structures
• Adjust lookbacks based on market volatility