N Candle UM Formations

N Candle UM Formations is a context-based candle analysis indicator designed to highlight indecision and potential exhaustion zones within an existing trend.

Instead of generating buy or sell signals, this tool focuses on market structure and behavior, helping traders identify areas where momentum may be weakening and attention is required.

🔹 Core Concept

The indicator:

Combines N candles into a single synthetic candle to reduce noise

Detects indecision-type candle structures, such as:

Doji candles

Pin bars (long wicks)

Small-bodied candles

Evaluates these candles only within a trend context

This approach avoids pattern memorization and focuses on where a candle appears, not just how it looks.

🔹 Color Logic

🟣 Purple candles
Indicate indecision near a pullback low within an uptrend
→ Possible seller exhaustion or accumulation area

🟠 Orange candles
Indicate indecision near a pullback high within a downtrend
→ Possible buyer exhaustion or distribution area

🟢 / 🔴 Green & Red candles
Represent normal momentum candles with no special context

🔹 Trend & Context Filters

Trend direction is defined using EMA-based structure

Pullback zones are evaluated relative to recent highs/lows with volatility tolerance

All calculations are close-based and non-repainting

🔹 How to Use

This indicator is not a standalone trading system.

It is best used as:

A context filter

A market awareness tool

A confirmation layer alongside:

RSI / TSI / Fisher

Volume analysis

Price action or structure breaks

When a purple or orange candle appears, traders are encouraged to seek confirmation from other tools before making decisions.

🔹 Key Philosophy

Context first, confirmation second.

This indicator helps traders focus on high-attention zones, not automated entries.

⚠️ Disclaimer

This tool does not provide financial advice and should not be used alone for trade execution.