Yesterday's OHLC

This indicator is designed to provide traders with a visual representation of the previous day's key price levels on their charts. The script calculates and plots four critical price points: the open, high, low, and close from the previous trading day. Users can customize the resolution from which these values are pulled, with the default set to daily. Additionally, the script offers options to hide past prices, display tomorrow's projected values, and customize the colors of the plotted lines for better visibility. The script intelligently adjusts for extended trading sessions, ensuring that the displayed values remain accurate regardless of the current market conditions. By utilizing the request.security function, it fetches historical price data and plots the values using step line styles, making it easy for traders to identify significant price levels that may influence future price movements. This indicator serves as a valuable tool for traders looking to analyze market behavior based on historical data, enabling them to make informed trading decisions.

Trading Strategy Using This Indicator
Strategy Overview:
The "Yesterday's OHLC" indicator can be effectively integrated into a trading strategy focused on breakout and reversal patterns. By observing how the current price interacts with the previous day's key levels, traders can identify potential entry and exit points.

1. Breakout Strategy:

Entry Signal:
If the current price breaks above yesterday's high, it may indicate bullish momentum. Traders can enter a long position once the price closes above this level, confirming the breakout.
Conversely, if the price breaks below yesterday's low, it may signal bearish momentum. Traders can enter a short position upon a close below this level.

Stop Loss:
Set a stop loss just below yesterday's high for long positions or just above yesterday's low for short positions to manage risk.

Take Profit:
Target a risk-reward ratio of at least 1:2. Traders can use previous support and resistance levels or Fibonacci retracement levels to identify potential take profit areas.

2. Reversal Strategy:

Entry Signal:
If the price approaches yesterday's high or low but fails to break through, it may indicate a reversal. Traders can look for candlestick patterns (like pin bars or engulfing patterns) near these levels to signal a potential reversal.
For example, if the price tests yesterday's high and forms a bearish reversal pattern, traders can enter a short position.

Stop Loss:
Place a stop loss just above the high (for short positions) or below the low (for long positions) to protect against false breakouts.

Take Profit:
Similar to the breakout strategy, aim for a risk-reward ratio of at least 1:2, using previous price action levels to set targets.

3. Additional Considerations:

Volume Confirmation:
Look for increased trading volume during breakouts or reversals to confirm the strength of the move.

Market Context:
Always consider the broader market context, including economic news and events, which can impact price movements.

By incorporating the "Yesterday's OHLC" indicator into these strategies, traders can enhance their decision-making process, leveraging historical price levels to identify potential trading opportunities. This approach not only helps in managing risk but also allows traders to align their trades with market sentiment and price action.