All About SuperTrend Indicator – Free Tutorial 2021 Updated

With this article, you can learn everything you need to know about the SuperTrend Indicator (ST). You can also download for free all SuperTrend custom indicators for many trading platforms.

We will examine the SuperTrend Indicator ST with intraday and multiday strategies using many instruments such as US stocks, commodities, currencies in forex, and stock indices.

As you know, the ST is a technical analysis trend follower indicator; it was created to ride a long-term trend, but it is a very versatile indicator that can be used in many other ways.

You will find many versions of the ST that you can download for the major platforms, MetaTrader, TradeStation, MultiCharts, NinjaTrader and many others.

We will also examine the SuperTrend in combination with the most famous technical indicators. Also, we’ll discuss a lot of technical analysis indicators similar to ST.

There is no other website where you could find all this free material because we assure you it took so many hours of work.

Let’s start with the basics.

What is SuperTrend Indicator

The SuperTrend ST, created by Olivier Seban, is a technical analysis trend follower indicator. These technical analysis indicators signal the direction of the trend and highlight the continuation or changes of direction.

People are searching for SuperTrend Indicator Investopedia definition, but if you wonder what Super Trend indicator is, keep reading and discover many things.

First, this technical analysis indicator is a trend follower indicator, so it works well in a financial trending market.

The ST is a very intuitive financial indicator. Also, a novice trader can easily use it to create a trading system. ST gives you a clear trend direction signal, elementary to interpret. It’s also straightforward to develop a SuperTrend screener to analyze a list of stocks.

The indicator draws a line above or below the prices and changes color based on its direction.

  • Green color = SuperTrend buy signal = SuperTrend positive breakout
  • Red Color = SuperTrend sell signal = SuperTrend negative breakout
SuperTrend indicator free tutorial

The SuperTrend line accompanies prices during the trend; as long as the trend is bullish, the indicator will stay below the prices and green. As soon as prices fall and the trend reverses, the technical analysis indicator will draw its line above the prices and turn red.

Oliver Seban created the ST for trend follower strategies, and it is coded to identify a trend and take advantage of the price movement for as long as possible.

Continuous changes in trend and, therefore, in color, make this indicator challenging to use; in fact, a trend follower indicator cannot perform during a range of market and will generate many false signals.

This happens with many indicators similar to SuperTrend because every trend follower indicator is a lagging indicator in technical analysis. The only solution is to use a combination of indicators to find SuperTrend buy or sell signal for your trading system.

The calculation method is simple; the SuperTrend Formula analyzes the formation of max and min on the single bar and performs a series of calculations using the Average True Range ATR.

SuperTrend vs ATR

It’s the use of the Average True Range that makes this indicator interesting. Many traders ask themselves questions like SuperTrend vs. ATR, but it’s a wrong question because it contains the ATR; it’s like a SuperTrend ATR.

The Average True Range is the most used indicator to calculate the historical volatility of a financial instrument.

When volatility increases, the ATR values ​​will increase, and therefore, its line will rise. While volatility decreases, the ATR will also fall.

The Average True Range value does not give us any detailed information while using it within another indicator, such as the ST, it provides us with useful help.

Using the Average True Range has been specifically designed to reduce the problem of false signals. Using the volatility calculation, the SuperTrend line stays at a distance from prices, and therefore, the trend changes less frequently.

Changing the SuperTrend settings, you can change the way the technical analysis indicator behaves, and we’ll show you two examples:

If we set two different values ​​of the ATR multiplier equal to 1 and 3, the volatility will affect a lot in the ST set to 3 and less in the one assigned to 1.

It’s simple, by decreasing the importance of volatility in the calculation, the ST changes color frequently.

If you are familiar with the concept of trailing stops, you will better understand this concept. As with the trailing stop, when the line is too close to the price, it can be crossed and generate more frequent signals.

When you use a trailing stop very close to the price, you will get out of the trade quickly, which you want to avoid often, just like when you are using the Super Trend Indicator.

More about ST and volatility

Measuring volatility is very important for any trading system; many technical analysis indicators measure volatility.

ST indicator uses the Average True Range indicator to measure volatility and adapt to it, but what is volatility?

Volatility measures the amplitude of price movements, the more volatile the financial instrument, the more it will have large price fluctuations.

Markets with low liquidity and, therefore, low volumes are more volatile because they are not controlled by smart money.

The mature markets with many volumes and open interests are very slow to move and, therefore, less volatile.

This happens because institutional investors control prices better and do not allow out-of-the-ordinary fluctuations, except in exceptional cases.

When an instrument is very volatile, it breaks its average quickly, changes direction abruptly, and moves away from the average for long periods.

SuperTrend and moving average price action

This moving away from one’s average for long periods is precisely the directionality and the trend we seek when we use a Super Trend strategy.

Therefore, a volatile market will give rise to many rideable trends than a market held back by smart money.

Another reason volatility is essential when using the ST indicator is that we often use it to make trailing stops or set a stop-loss level.

In these two cases, which will be better analyzed in the following paragraphs, the volatility calculation is essential to set stop-loss and trailing stops correctly.

Indeed, when setting up a stop order using the ST, keeping a safe distance from the current price is essential.

By placing a stop order too close to a volatile instrument’s price, we will continually be kicked out of the trade and cannot ride the trend.

The stop loss and trailing stop set with the ST with SuperTrend default parameters should give the trader certainty as the ATR guarantees volatility calculation.

The volatility to which the ST refers is the historical one calculated with the ATR and not the implied one calculated through the option prices.

Olivier Seban: the SuperTrend inventor

A small biographical note on the inventor of the Super Trend
Olivier Seban is a French writer inventor of the SuperTrend Indicator, his most famous book is “Tout le monde mérite d‘ être riche “, translated into over 20 languages.

His book explains how to get rich even without starting capital through real estate and the financial markets.

Olivier Seban had many failures early in his career. He started many businesses, which turned out to be failures, but he never gave up and eventually got rich at 32.

olivier seban book

Olivier Seban, at 32, created a company that earned him from 0 to 100 million francs in 4 years. Having achieved this, Olivier sold his company and retired while continuing to run his business online.

If it interests you, learn more about Olivier Seban’s story by reading this post, where you can find more information about it.

How SuperTrend works

We can use the Super Trend in many ways; it can be used alone or together with other indicators or inserted into a Super Trend strategy as a trend filter.

It’s important to understand that ST is a trend follower indicator, so Olivier Seban created it for this strategy. No one would ever dream of using the SuperTrend in a mean-reverting system except as a simple trend filter.

We, therefore, have our indicator that changes color every time we detect a change in trend.

Let’s place it on a chart. First, if you have not already done so, download the indicator for your platform at the end of this article. 

You will also find a Super Trend Indicator PDF that is a guide to install it in your MetaTrader platform.

We made SuperTrend available to you for free for MetaTrader4, MultiCharts, TradeStation, and other trading platforms.

supertrend indicator classic visualization metatrader multicharts tradestation
Click to enlarge the image

The picture above shows the classic visualization method; as we have already said, the ST turns green when the trend is bullish and turns red when it is bearish.
Then prices rise, cross the Super Trend line, which turns and turns green. When prices go down, the indicator identifies a bearish trend and turns red again.

  • Green color = SuperTrend buy signal – SuperTrend positive breakout
  • Red Color = SuperTrend sell signal – SuperTrend negative breakout

Below I will show you two simple methods to use the SuperTrend. They are general indications because we will deepen the individual strategies later.

Super Trend Formula

Before analyzing the strategies to be implemented with the SuperTrend algorithm, let’s see how this indicator is calculated.

The ST has a straightforward and intuitive calculation formula; it will only be necessary to know the maximum and minimum prices and the value of the ATR.

As we explained to you, the indicator is displayed through a single line, but it is made up of two lines. The technical indicator is built in such a way as to show only one at a time.

Therefore, it is always necessary to perform two calculations regarding the upper line and the lower line to construct the technical indicator.
SuperTrend Formula:

  • SuperTrend Higher = (Max + Min) / 2 + Mult * ATR (n)
  • SuperTrend Lower = (Max + Min) / 2 – Mult * ATR (n)
  • Mult = multiplier – standard value = 3
  • N = Atr Period – standard value = 10


As you can see, the Super Trend formula is almost the same; the value of the ATR is subtracted or added depending on whether it is the upper or lower line.


Let’s analyze the various parts of the formula:

Max + Min / 2

With this calculation, we get the average price if, for example, we had a minimum = 10 and a maximum = 20, we would get (10 + 20) / 2 = 15, which will be the average price of the reference bar.

Once this value has been obtained, we will add or subtract the Average True Range multiplied by the multiplier value.

As you can see from the SuperTrend formula, the Average True Range calculation plays a fundamental role. The multiplier is the only input that changes the graphical configuration of the indicator.

As you can see, volatility plays a fundamental role in the construction of the SuperTrend algorithm. It is precisely this aspect that makes it interesting compared to other trend indicators.

From the simple examination of the SuperTrend formula, you can understand how much difference it can have using a multiplier equal to 1 compared to a multiplier equal to 3.

How to use the SuperTrend

When considering an indicator like the ST, we need to understand that we can use it in so many ways.

We shouldn’t fossilize about using this indicator to get SuperTrend buy and sell signals because it is much more.

In this chapter, we will look at five ways to use the ST and delve into each use in detail.

The first way to use the SuperTrend that we will describe in this chapter will be the simple stop and reverse strategy.

With this strategy, you follow the SuperTrend buy and sell signals with the most classic trend follower strategies.

We will explain all the limitations of this type of strategy, especially in current markets, and how to use it best on the right tools.

We will then see how to use the SuperTrend as a trailing stop for managing a trade.

This is a fascinating use for this indicator because it works best as a trailing stop while it plays the same role as an Average True Range.

Many use the Average True Range for the trailing stop, but the ST is more stable than a pure ATR, facilitating a trailing stop.

Another interesting use of the ST that we will see in this chapter is pure trend filter.

We well know that it is always good to check the direction of the trend before opening a trade; the ST is an excellent indicator to explain ​​the direction of the trend on a graphical level.

We should always insert the trend filter even in a time frame higher than the reference one.

It can be just as useful to insert into an automated trading system, even programming it as a multi-timeframe filter.

The trend filter is also creating a SuperTrend screener with which to monitor many instruments on a single screen.

Finally, the SuperTrend can be used to easily and quickly calculate stop loss and take profit.

The SuperTrend Easy method Stop & Reverse

Many trading systems based on this indicator have the simple rule of opening long when the ST turns green and opening a short when the ST turns red.

These trading systems are simple and rarely work; for example, an easy formula for a Super Trend strategy could be:

  • SuperTrend buy signal = SuperTrend positive breakout.
  • SuperTrend sell signal = SuperTrend negative breakout.

We can easily predict that a stop & reverse trend follower strategy will not give excellent results without filtering or corrections.

It’s not an indicator’s fault… a trend follower strategy only works when there is a market trend.

Therefore, the most straightforward and most immediate method to use the SuperTrend is to open a long or short position when a trend change occurs.

Thus, the basic strategy is a stop & reverse that is always on the market and has no other parameters, such as taking profit or stop loss.

We can certainly improve this strategy, but the concept we would like to keep in mind is that the ST is a pure trend follower indicator, so it has all the limitations of this family of indicators.

ST is always late on price movements and trend changes, so in low volatility markets, the single trade will rarely have a satisfactory average profit.

We are not saying that this strategy cannot work; we say that certain conditions must exist for it to work.

The most critical conditions for using a trend follower strategy are:

  1. The financial instrument, whether it is forex or stocks, must have often had long trends in the past. A visual backtest of the SuperTrend indicator will also suffice. The more signals the indicator generates, the less reliable the signals they will be.
  2. We must be able to stay in position for as long as possible. For example, if we have a SuperTrend buy signal and enter the market, we want to go into profit, but we also want to stay in this trade for as long as possible. Our stop loss will have to be smaller than the take profit. For example, the ratio should be at least 1: 2, so if we set a stoploss of 100, we should be able to get a take profit of at least 200, but also 300.
  3. Because of the two previous points, our average trade must be very high. We will also have many small losses and a few large gains. These are the characteristics of a trend follower system.

Warnings about trend follower strategies in current markets

Before examining the trading strategies that can be carried out with the ST, it is necessary to explain the trend follower indicators better.

SuperTrend, like any other trend follower indicator, lags the price movements. For this reason, they are also called “lagging indicators”.

In this introduction, I want to explain why these indicators lag the trend and why these strategies no longer work so well in current markets.

This part is essential because many trend follower strategies performed well a few years ago, but today these strategies have stopped working.

To use a trend follower strategy, it is necessary that a trend exists and that this trend continues for a long enough period to allow our trade to accumulate enough profit.

A trend follower strategy accumulates small losses waiting to identify the trade that will allow you to recover all losses and make a big profit.

So, a trend follower strategy based on SuperTrend will have an equity line very similar to any other trend follower strategy, for example, at a crossing of moving averages.

There are many indicators similar to Super Trend, and all these indicators would have roughly the same performance because the most important thing is the existence of the trend. If the trend does not exist, any indicator similar to SuperTrend will work.

There will be a series of signals that will not turn into small losses or small gains, and then there will be some few trades with large profits.

Suppose the ST continuously changes color and, therefore, from continuous trend change signals entering and exiting the trades. In that case, it will not be possible to remain in position for the time necessary to accumulate an adequate profit.

You consider that a trend follower strategy has a win rate of about 70% and an R:R of 1: 3 and higher; this means that every 10 operations have 7 losses equal to 1 and 3 wins equal to 3 for a total gain of 2.

The longer the trend lasts, the higher the risk/return ratio will be. If we enter a trade today with a stop loss of 10 and the financial instrument runs for weeks, making me take home 100, I will have a RR of 1:10.

The SuperTrend, compared to other trend follower indicators, has the advantage of the Average True Range, which allows you to stay longer in a trade because it filters the volatility.

However, this filter is not miraculous. The only way we can extend the trades’ life is to increase the SuperTrend multiplier to decrease the number of reversal signals and reduce the number of transactions.

Suppose by increasing the Super Trend multiplier; you can stay longer in a trade. In that case, by decreasing the number of operations too much, we will remain too long in the market and reduce the strategy’s profitability by increasing the statistical variance.

Until a few years ago, it was relatively easy to find instruments with long medium-long-term trends. It was, therefore, easy and low risk to apply this strategy with the ST.

Today the markets have lost this characteristic, and we do not know if things will change, but we must face the market with current information; we must never become attached to a strategy when conditions change.

There are still some tradable financial instruments with the ST; the only way to find them is through a visual examination looking for the tools that have fewer color changes.

You can also use a portfolio backtest, inserting lots of instruments with a simple stop & reverse strategy to identify a list of instruments that are still tradable.

Tips and advice for Trend Follower Strategy

As we have seen, trend follower systems work well when there is a long-term trend. The ST has the same strengths and weaknesses as any other lagging indicator.

We refer you to the previous chapter in which we analyze all the limits of a trend follower strategy in current markets.

Before using the SuperTrend in the most traditional ways, thus opening a trade every time the indicator changes color, it is necessary to consider some fundamental aspects.

Supertrend buy signal and supertrend sell signal strategy
Click to enlarge the image

The first aspect to consider is the timeframe to be used; the longer the timeframe, the greater its profitability.

A trend follower system, such as the ST, makes money to follow the trend for a long time. In intraday timeframes, you will hardly find trends that will allow you to get a decent profit when the trade is right.

Try it yourself. Choose any financial instrument and backtest all timeframes starting from the 5-minute one up to the monthly one.

You will see the profitability of the SuperTrend strategy go up as the timeframes go up. The most critical parameter to monitor is the average trade profit. This value must be large enough to pay off commission fees and slippage. When this value becomes too small, the strategy degrades, and the statistical variance rises.

So our first advice for using a trend follower SuperTrend strategy is to use timeframes longer than daily.

Our second tip concerns the choice of the instrument. Not all financial instruments react well to trend follower logic, and many times it depends on the liquidity of the market.

The more liquid the market is with high volumes, the less it will respond to trend follower logic with the ST indicator.

High liquidity and high volumes show that the financial instrument is also used and traded by smart money or institutional ones.

Many institutional traders’ presence leads to greater financial instrument stability, which will respond well to mean-reverting logic.

The most classic example is the US S & P500 stock index. Like many US stocks, this index moves very little in the intraday session, and it would be virtually impossible to trade it in the long term with the ST.

So our second advice is to look for illiquid financial instruments and develop good medium-long-term trends. For example, commodities or some small-cap stocks are great tools for trend follower strategies. Also, bitcoins are an excellent choice.

Our third piece of advice is about exposure. Using illiquid instruments develop strong trends and have a huge gap up and gap down, so beware of stop losses.

SuperTrend as a Trailing Stop

We want to show you how to use the SuperTrend Trailing Stop, in fact, many traders use it to manage their position.

We use the trailing stop during the life of a trade when we want to follow the price and collect as much profit as possible.

The tighter the trailing stop, the more likely the trailing stop will hit the price, and the position will be closed.

So let’s suppose we have an open position on Eurusd and are in profit of about 100 pips, we have set a take profit at 300 pips, but we don’t want to lose all the accumulated gain.

Let’s enter a stop order to close the trade equal to the value of the SuperTrend, and we will adjust this value to each candle change.

Supertrend indicator trailing stop
Click to enlarge the image

To improve the indicators’ reactivity, you should use it in a smaller time frame. For example, if we have to manage a daily timeframe trade, we will set the trailing stop with the SuperTrend on a time frame H1.

As we have said several times, the ST is an excellent tool for identifying the trend, but it is always late compared to the trend change.

There are certainly more effective trailing stops, but sometimes, it is possible to lower the time frame by giving the indicator greater speed regarding the change in the trend.

The less we want to give breath to the open trade, the more we will have to lower the time frame to close faster in case of price movements in the opposite direction to our position.

SuperTrend as a trend filter

The easiest way to use the SuperTrend is to indicate the trend in your timeframe or higher timeframes at a glance.

One of the most important trading rules is “trend is your friend” according to which you should never open positions contrary to the trend, so it’s a good idea to use a Super Trend filter.

Our rule is “High timeframe trend is your friend” because we don’t care about the trend in the timeframes below the daily.

If you have followed this rule, choosing each time in a discretionary way, the trend’s direction could create problems because sometimes you could force your analysis or confuse the trend.

Using this SuperTrend filter to check the trend direction is easy, immediate, and reliable. Just insert a rule of this type in your trading system: open new trades only toward the daily trend showed by the ST.

So if you are on a 15-minute chart and your system signals you a long entry, but the SuperTrend on the daily chart is red, you won’t have to open the position because the trend rule in the upper timeframe is more important than the signal on a chart 15 minutes.

As we will see later in this article, you can create a SuperTrend screener with many SuperTrend alerts that advise you when the trend is changing.

Using a SuperTrend screener is a good idea because you can monitor many financial instruments without opening the related charts.

You can create a live SuperTrend screener with many trading platforms; maybe you can find an online service.

Every time you’ll decide to open a trade with your trading system, you can check if the live screener confirms the trend; this technical analysis tool is handy.

Over time you will see that this way of working will decrease your number of operations and increase the profit factor, and it’s a good deal.

You can use the SuperTrend filter to check the trend in every market, US stocks, Forex, or Hindi Stocks.

SuperTrend Screener

To filter the trend of many instruments, you can create your live SuperTrend Screener to monitor the trend of many stocks or forex crosses.

Many trading platforms such as MultiCharts and TradeStation have already preset a screener in which you have to enter the ST and SuperTrend settings.

We can then add infinite financial instruments to the SuperTrend screener based on the data package available to you. In any case, it would be possible to monitor all the actions of the S&P500, Nasdaq and Russell2000.

On MetaTrader4 you can insert the SuperTrend Alert indicator and then open more charts; you can find a free indicator for MetaTrader4 at this LINK.

A Super Trend Screener can also have input signals whenever there is a change of trend and, therefore, color in the indicator.

We must set two conditions to trigger the Super Trend alert:

  • SuperTrend buy signal screener – Red becomes green.
  • SuperTrend sell signal screener – Green becomes red.

In addition to this simple SuperTrend alert, you can enter infinite conditions and indicators to filter the operation further.

Therefore, a trading screener is always the best solution to use an indicator on many instruments without having to open all the charts every time.

We should use an indicator such as the ST, which will produce few operations per year on multiple instruments daily to create a strategy with a more significant number of trades.

So we’re going to create a portfolio of stocks or ETFs or other financial instruments that work well with trend follower strategies like SuperTrend.

Once the portfolio has been selected, we will enter it in the ST Screener and decide the conditions to trigger our SuperTrend alert.

You will also have to decide how much capital to use for this ST wallet and how many trades you can open simultaneously.

Using a strategy with a financial instruments portfolio will help you reduce volatility and obtain results less subject to variance. It allows you to take less risk because smaller positions are opened.

The problem is that the markets are significantly correlated with each other, and therefore, this choice may not decrease risk and exposure, but paradoxically it could increase it.

On this aspect, we dedicate the next paragraph, which concerns the ST, but in general, all the indicators and trend follower strategies.

ST and market correlation

And here’s a problem… Modern markets are significantly correlated, and the old correlations don’t seem to work anymore.

Gone are the days when bonds went up, stocks went down. Central banks’ liquidity mass has drugged the commodities market, the forex market, and even bitcoins in recent years.

The SuperTrend alert signals a change in trend; as the markets are significantly correlated, we can find a trade signal on many instruments simultaneously.

We are not talking about a Super Trend alert triggered on a basket of shares from the same list, but about the absence of safe-haven assets in which savers position themselves during certain phases.

There are no longer many safe-haven assets; when the stock market collapses, most of the other assets collapse. It is now possible to see a haven asset like gold rise as the stock market surges and the bond market follows suit.

Therefore, it won’t be easy to create an uncorrelated portfolio composed of stocks. It will be very likely that the SuperTrend alert will trigger simultaneously for many instruments in the portfolio.

Therefore, it is essential to establish in advance the portion of capital to be used in the strategy included in the Live SuperTrend Screener and the maximum number of operations that can be open simultaneously.

It should be remembered that a trend follower strategy, to work well, requires long-term operations in which the profit is allowed to run and, therefore, commit the margin for a long time.

Therefore it is essential to establish the strategy well in advance to not find yourself with a multitude of operations all deriving from the SuperTrend and all correlated with each other with a hazardous exposure.

How to set StopLoss and TakeProfit

You have just opened a trade using the ST and would like to insert a stop loss and a take profit; what values ​​should you enter?

First, remember the considerations made in previous chapters regarding trend follower strategies.

We said that a trend follower strategy needs to take as much profit as possible from winning trades and to lose as little as possible from losing trades.

A SuperTrend strategy, like any other trend follower strategy, has a win rate of about 70%, and therefore, the ratio between stoploss and take profit must be at least 1:2 but possibly 1:3.

When the SuperTrend buy or sell signal is triggered, and we enter the position, we will do some calculations, and the starting point will be the ST value at the time of the trade opening.

The value of the SuperTrend will be our stoploss, and therefore, we can immediately place a stop order with that price. Starting from the stop loss amount, we will calculate the take profit, which will be 2 or 3 times larger than the stop loss.

At this point, we can let the operation run until the loss or profit is reached, or use a trailing stop or move the order to break even when a sure profit is reached.

The stoploss thus entered will have a safety margin calculated by the Average True Range and will therefore be a stoploss optimized for the instrument’s current volatility.

The Super Trend is based on historical volatility, which can be significantly different from the current one and this could reduce the safety margin of the stoploss thus calculated.

Real Market SuperTrend examples

Let’s analyze some real cases with our SuperTrend on a daily timeframe.
Let’s start with a mid-term analysis of the Apple stock.

Apple chart daily trend follower strategy with supertrend
Click to enlarge the image

Let’s see how in mid-September 2019, we had a SuperTrend buy signal that remained unchanged until the end of February 2020.

The trader could then have happily repurchased at the beginning of May 2020 and remained in the trade until October, just before the US elections.

If we think about it, it doesn’t seem that difficult …. Covid arrives, we exit the stock market, and then we come back when it starts to rise again, and we exit again before the American elections to avoid surprises.

It seems that in this, the indicator has moved following the news, but obviously, it is not; it is only the market that reacts to the news, and the indicator follows it.

If we analyze how much panic has been unleashed on the markets due to the Covid, seeing how we could manage the market with the SuperTrend makes us think.

So, why use anything else? The SuperTrend has led us out of one of the biggest crises of recent years profitably, and now, at the highs, we would be flat or even short again.

However, there are many things to consider before turning SuperTrend signals into shiny gold, even in this chart.

Look closely when you have opened and closed your trades; we have highlighted the SuperTrend buy and sell signals with red and green circles.

Supertrend indicator lagging for trend follower strategy on apple stock
Click to enlarge the image

As you can see, the indicator is always very late about the price movement; when the market moves with gaps, exiting and entering with the right timing is difficult.

The indicator on a chart gives the impression that the indicator moves reactively, but the exit and entry timing is undoubtedly lagging.

We don’t think a novice discretionary trader would have done better than the ST, but the following second aspect has to be considered.

Apple stock moved a lot during the reporting period, driven by news and high volatility, so using the SuperTrend was easy.

Let’s see what happened before the covid; let’s go from June 2017 to August 2018.

Supertrend false signals buy and sell signal
Click to enlarge the image

We can see a succession of false signals caused by a total absence of trends and, therefore a defeat for this type of indicator.

No one can know whether the future movements of a stock will be directional or not; it is understood that the SuperTrend can be great at one time and wrong at another.

Look at the Apple chart of the last six years; the ST would have earned very little if not in the previous period.

When they want to sell you an indicator or a trading system, never trust the examples shown to you; always investigate and go back in time.

SuperTrend settings and parameters

The classic SuperTrend settings are 3 10 and should be used without changes; exceptionally, the less experienced should always refrain from changing any technical indicator’s default settings.

However, if you intend to change SuperTrend length and factor, try to do it with logic and not by chance, but above all, try to understand what happens when you change the settings.

Changing Super Trend settings without knowing its meaning means completely distorting the indicator and obtaining unreliable trading indications.

The SuperTrend settings’ modification must be made when you want to adapt the SuperTrend to a specific market.

Markets with different volatility may need different SuperTrend settings to avoid as many false signals as possible.

Even when you go down or up in timeframes, you may need to change the SuperTrend settings.

The indicator has only two input settings, the period with traditional value 10 and the multiplier with value 3.

Moving too far from the standard multiplier setting, using 1 or 6, means completely altering the indicator.

While the period is not essential, changing the multiplier will profoundly change the behavior of the ST.

When you use a trend follower strategy or indicator, your first goal is to limit the false signals and increase the period’s value and the number of trades. Therefore, the number of false signals will decrease.

However, decreasing the signals too much will make the trading strategy unreliable. 

This concept is also valid if you were using the SuperTrend as a trend filter, by increasing the period, the trend changes will decrease. The filter will become more stable but less reactive to market dynamics.

At this link, you can find our tutorial on finding the best SuperTrend setting but remember that the settings are always related to the type of financial instrument to be analyzed.

good settings for indian market stocks
HOW TO FIND THE PERFECT SUPERTREND SETTINGS

The question most often found on forums is the best SuperTrend period and multiplier for intraday or the best SuperTrend settings for scalping.

Best SuperTrend Settings for scalping

There are no SuperTrend settings for scalping because the SuperTrend is not an excellent tool for scalping.

As we have said in previous chapters, the ST needs time to let profits run. Scalping a trend follower strategy is financial suicide.

Scalping is a very complicated activity because high commission costs are difficult to cover due to the high number of operations and the meager average trade.

Furthermore, it would be better to use the SuperTrend only in high timeframes, and therefore, from this point of view, scalping is not the ideal strategy.

Best SuperTrend Settings for intraday trading

For the same reason that it is not convenient to use the SuperTrend for scalping, it will not be suitable to use it for intraday trading.

So looking for the perfect SuperTrend period and multiplier for intraday is not the right thing to do.

Why is it so wrong to try to fit the SuperTrend on an intraday chart?
The first reason is the total absence of trends in intraday timeframes. Small intraday movements characterize today’s markets compared to the past. Therefore, a trend follower strategy will rarely work.

Furthermore, you will hardly find the best SuperTrend settings for intraday because the volatility constantly changes during an intraday session.

Very high volatility at the beginning of the day, absent volatility during the session, and then again higher volatility prevents the best use of the ST, which has an excellent volatility filter inside it, such as the Average True Range.

Given the continuous changes in intraday volatility, it would be necessary to adapt the ST to the time of day and enter the field of over-optimization.

SuperTrend Multi Time Frame

As we have just seen, using the SuperTrend filter to identify the trend is always a good idea.

It is better to analyze the trend from a timeframe at least greater than 4 hours because an intraday timeframe is too fast and will never provide an exact direction.

An intraday time frame is full of so-called background noise; it is widespread to see trend indicators in short time frames continuously.

This is certainly a problem because you will get tons of false signals, and you will never know what the real direction of the trend is.

Simultaneously, using a high time frame to get trading signals can be frustrating as there will be few occasions to view one SuperTrend buy or sell signal.

The best choice is to use a SuperTrend Multi Time Frame Indicator to view the trend in various periods.

It is also possible to change the SuperTrend settings to adapt the indicator to the higher timeframes’ different volatility. Still, if you do not know how to do it, it is always better to use the SuperTrend default parameters.

Here you can find a useful article: How to find the perfect SuperTrend settings.

If you want to create a trading system using the SuperTrend buy and sell signals, you will need to use the indicator in an intraday timeframe, ideally an hourly timeframe.

As with other indicators similar to SuperTrend, you will have many false signals, and therefore, you will need a trend filter and check the higher timeframes.

With a SuperTrend Multi Time Frame indicator, you will have both the entry signals in the hourly timeframe and the trend filter daily or weekly timeframe in a single indicator.

By using the trend filter, you will significantly reduce false signals from hourly or lower timeframes.

We created this indicator for TradeStation and MultiCharts; from this article on the SuperTrend MultiTimeFrame indicator, you can download the free indicators.

Supertrend multitimeframe indicator strong buy signal eurusd
Click to enlarge the image

When using a multi time frame technical analysis indicator, it is always best to view it as a histogram:

With our indicator, you can see the chosen timeframes’ trend direction in one chart, making everything much more straightforward.

SuperTrend combination

Remember, don’t use SuperTrend with Parabolic SAR in combination because they do the same thing; later, we will see another indicator similar to SuperTrend.

Like any other technical analysis indicator, the ST can be used alone or in combination.

We can use the SuperTrend with any price pattern or indicator to increase its accuracy; increasing the accuracy of the ST means finding the right compromise between a sufficient number of operations and a large average trade.

Before choosing the right indicator to use, we must remember that the SuperTrend is a trend follower indicator and should not be associated with another indicator of the same family.

Many traders often forget this simple rule, and in fact, we can find numerous strategies or graphical analyzes that use the SuperTrend in combination with MACD or Parabolic Sar.

As we will see shortly, it is not a good idea, while it could be an interesting one to use the ST with indicators that are programmed in different ways, such RSI or ADX.

As we have said several times, the ST used alone is not an excellent entry and exit signal indicator. Still, by inserting additional rules into the trading system, we could certainly improve it.

SuperTrend and Parabilic SAR

SuperTrend and Parabolic SAR are very similar, but the ST is drawn horizontally; this helps us in moments of price laterality, avoiding getting us out of position before time.

Remember, don’t use SuperTrend with Parabolic SAR in combination because they do the same thing; later, we will see another indicator similar to SuperTrend.
We also add that the ST works much better than the Parabolic SAR as it contains a volatility filter built with the AverageTrue Range.

Another thing to remember is that all trend-follower indicators have a common flaw: they warn about the change of trend AFTER the change has happened, not BEFORE.

They are all indicators that update the trend signal with an inevitable delay; they never leading the trend move.

Therefore, the SuperTrend is much more accurate, and it would make little sense to use it together with the Parabolic SAR, which will signal many more trend changes and, therefore, many more false signals.

SuperTrend with MACD real case

Some analysts use the SuperTrend with MACD to confirm the two indicators’ signals; we believe this choice is deeply wrong as both indicators belong to the trend follower family.

We will hardly have conflicting signals from the SuperTrend and MACD used on the same chart.

Combining other indicators with the ST is undoubtedly a great idea, but it is advisable to choose an indicator that is not too similar.

The MACD is constructed differently from the SuperTrend but is ultimately composed of moving averages.

Also, the MACD does not use the Average True Range to calculate volatility, so in our opinion, it is less useful than the ST.

MACD and SuperTrend have the same problems in identifying the trend: they are lagging and cannot predict a possible reversal. Using two similar indicators will lead to wrong conclusions, and the confirmation of both indicators could give even more strength to the wrong forecast.

Here you can find a great example of an analysis done on the nifty50 using SuperTrend with MACD. 

MACD and SuperTrend are both trend follower indicators; then, they are used to measure the momentum, the strength, and the direction of a trend.

This analysis is an epic fail, as it often happens following only the trend indicators; from May onwards, the index did nothing but rising despite the concordant signals of SuperTrend and MACD.

In these cases, it’s like asking a second opinion from the same doctor, what are you expecting?

SuperTrend with EMA

As we have said several times, a successful trend follower strategy lets profits run for as long as possible, so using an indicator that is too reactive will only decrease our average trade profit.

We can repeat the same concept valid for the Parabolic SAR for the ST combined with the moving averages.

In the case of the moving averages, however, we could think of using the SuperTrend as a long-term trend filter and of using the crossing of the moving averages to obtain the entry signals.

A SuperTrend with EAM strategy will therefore consist of an entry and exit signal deriving from the crossing of the moving averages with the possibility of opening positions in the direction of the trend indicated by the ST.

Moving averages are a trend follower indicator and therefore do not predict a change in trend. Still, in certain situations, the crossing of moving averages can generate interesting signals with a faster speed than the SuperTrend.

It is possible to use a moving average with a more extended period to indicate the direction of the trend in the same way and use it as a filter.

The use of the SuperTrend, however, would provide us with a complete strategy, with a trend filter, an indication of takeprofit and stoploss based on volatility, and possibly a handy trailing stop.

SuperTrend and RSI

It certainly makes more sense to use an oscillator in conjunction with the SuperTrend, rather than another trend follower indicator.

A great indicator to use with the SuperTrend is the relative strength index or RSI.
This indicator signals the overbought and oversold phases, trying to identify a market turning point unlike the SuperTrend, the RSI is considered a leading indicator, i.e., it should predict trend changes.

As we have seen, the ST is always late (lagging indicator) and will signal the change in trend when this has already occurred by some candles.

Even if the Relative Strength Index is considered a leading indicator, this does not mean that it can predict a change in trend.

Like any other technical indicator, it cannot predict the future but signals excessive selling or buying pressure.

We are well aware that historically the markets undergo retracements when the trend lasts for too long and, therefore, when overbought or oversold phases are created as identified by the RSI.

We will use the RSI indicator with its standard settings. Therefore 70 for the overbought zones and 30 for the oversold zones at 14 periods, to not have too many signals.

Remember that a SuperTrend-based system needs to let profits run, and therefore a premature exit from the trend would ruin the whole strategy.

It will be very likely that once you enter the trade, the trend will not continue for a long time, and there will not be enough space and strength to make the trend run.

A much more favorable situation is a SuperTrend buy signal when the RSI is in an oversold zone or with a value below 50.

RSI with SuperTrend modern market and trend follower strategies

The market often continues in its upward or downward race, ignoring the overbought and oversold areas.

This is what has happened more and more often in the stock market in recent years, where the entry timing of a system based on overbought and oversold has lost some of its historical effectiveness.

So if we use our indicator with the standard SuperTrend settings 3 and 10 and we have opened a trade following a buy signal from the SuperTrend, we can use the RSI to decide when to exit the trade.

We will use the RSI indicator with its standard settings. Therefore 70 for the overbought zones and 30 for the oversold zones at 14 periods, to not have too many signals.

Remember that a SuperTrend-based system needs to let profits run, and therefore, a premature exit from the trend would ruin the whole strategy.

We can also use the RSI to filter a possible entry, for example, a SuperTrend buy signal that occurs when the si is in an area close to the overbought; suppose 60, it will not be a grand entry and should be avoided.

It will be very likely that once you enter the trade, the trend will not continue for a long time, and there will not be enough space and strength to make the trend run.
A much more favorable situation is a SuperTrend buy signal when the RSI is in an oversold zone or with a value below 50.

It is easy to understand this concept. If the price fluctuates between an oversold and overbought zone, buying in the oversold zone should give us a better chance of running profits long enough to have an excellent average trade.

Not all financial instruments respond well to RSI; many continue their race for long periods, even in overbought or oversold areas.

Unfortunately, the financial instruments that respond well to the logic based on RSI and oscillators are precisely the tools that do not work well with trend follower strategies.

The most classic of the strategies based on RSI is the one on the major US stock market indices, which are mean-reverting markets, as we have said in the previous paragraphs.

SuperTrend for all trading platform

The SuperTrend is a widely used indicator, but despite this, many trading platforms have not yet included it in their collection and will therefore need to be imported.

The most available trading platforms, such as MetaTrader4 or MultiCharts, or TradeStation, do not have this default indicator within them, but you can download it for free from the links you will find in this chapter.

Some online technical analysis platforms contain this indicator, such as TradingView and we will provide you with the link.

SuperTrend TradeStation and Multicharts

Multicharts and tradestation are the professional platforms most used by private traders worldwide, but they do not contain SuperTrends by default.

We have specified private traders because even small investment funds do not use this type of platform.

For a private trader, they are potent tools that allow you to do many things and customize anything.

Using the SuperTrend, it is possible to create screeners to monitor more instruments. It is also possible to create an automatic trading system by inserting all the rules we want.

We have written numerous articles on the STregarding tradestation and multicharts, and below, we provide all the links:

In this article, you can download the SuperTrend for MultiCharts and TradeStation for free.

Furthermore, in this article, we created the multi-timeframe SuperTrend, in its histogram version to use it without the indicator on the price chart; you can also download this indicator for free from our website on this page.

SuperTrend ninjatrader 8

We don’t use the ninjatrader8 platform much; we prefer the programming language’s simplicity in easylanguage.

However, it is an exciting platform, and you can find many indicators not present for other trading platforms.

We do not have our version of the SuperTrend for ninjatrader8, but at this link, you can download the indicator for free.

Amibroker

If you are looking for the SuperTrend for AmiBroker you can download it for free at this link.

We don’t use amibroker at the moment.

SuperTrend TradingView

If you do not want to install a trading platform on your PC and are only interested in carrying out graphical analyzes with the SuperTrend, you could use the TradingView.com online service.

Through TradingView, you can use the SuperTrend and many other indicators for free with an infinite number of financial instruments and immediately.

This type of solution is often used by people who use their bank to trade in the market with ETFs or investment funds and therefore do not need a trading platform connected to a broker.

Using TradingView you will find many versions of the ST, and you will also find screeners, alerts, and trading systems.

Like TradingView, other online services can indicate the SuperTrend entry signals without installing trading platforms on the pc.

A site that deserves to be mentioned is BarChart, at this address, you can find a screener based on the SuperTrend Barchart.

SuperTrend for ThinkOrSwim

ThinkorSwim is a great trading platform, especially for those who trade with options. It has tons of tools and tons of volatility studies.

If you are interested in learning more about volumes, implied volatility, and more, this platform could be beneficial.

There is also a SuperTrend for ThinkorSwim; here is the link to download the indicator.

SuperTrend MetaTrader 4

To download the SuperTrend for the metatrader4, go to the end of this tutorial. You will find the bundle for all platforms and download it for free.

Before downloading the mt4 SuperTrend or an ea mq4 SuperTrend, we would like to warn you about some aspects.

Metatrader 4 is generally used for trading forex; if you are thinking of using SuperTrend for forex, you need to be very careful.

For some years now, the forex market is no longer responding well, and trend follower logic and volatility have dropped significantly.

It isn’t easy to find efficient SuperTrend buy and sell signals in forex and major currencies.

You can always find interesting trends in the commodity market that can still be traded with the metatrader4 through CFD.

However, before using an mt4 ea SuperTrend in forex, visually check how the financial instrument has performed in the past.

If the ST continually changes color, forget it, and if anything, use it only as a trend filter.

SuperTrend Formula and Code Multi software

SuperTrend Excel 

Excel can become an excellent platform for technical analysis, and we often use it to do in-depth data reviews.

On this site, you will find many tutorials dedicated to excel, on how to import data, and on how to create indicators:

On this link, you can find a SuperTrend for excel that should work in realtime; we haven’t tried it; let us know what you think, leave a comment on our Facebook page.

SuperTrend Python

It is becoming fashionable to do financial analysis using python; there are many courses on this topic.

Python is a powerful and versatile programming language; we will be doing tutorials on the subject in the future.

It is certainly not recommended for a novice trader to use. There are many advanced trading platforms, and there is no need to learn a complicated programming language to do graphical analysis.

If you are looking for the code to use the SuperTrend with python, you can find it at this address.