A mini coil is a low risk setup that can be used within a longer term pattern. The coiling action represents a tightening of volatility and is most effective when price is no more than 10-15% above a prior base.
The mini coil was created by Matt Caruso, @CarusoInsights, a professional investor and top performer in the 2020 US Investing Championship, finishing with a 346% return.
Mini Coil Setup ▪ Given an initial bar, at a minimum, two bars follow that don't exceed the high or low of the initial bar. ▪ The entry is when there is a break above the high of the initial bar. ▪ A common stop is the low of the last bar before the breakout.
Unique Features ▪ Real Range When the initial bar open is a gap up greater than the previous bar close, when using the real range, the start of the mini coil is the close of the bar prior to the gap up. See the examples below for more information.
▪ Thresholds During the formation of a mini coil, price may deviate slightly above or below the high or low of the initial bar. It can be helpful to set a threshold which allows for small percentage moves, above or below, yet still consider the price to be within the high/low range of the initial bar.
▪ Breakout Price To help track the potential breakout price, there is an option to show the high of the initial bar.
Mini Coil Examples
DDOG - Real Range
AAPL - Historical Mini Coils
AMD - Real Range and Threshold %
版本注释
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Version 2.0
■ Add an option to limit the length of a mini coil. ■ Updates to the real range calculation.
版本注释
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Version 3.0
■ Add an option to view mini coils on all timeframes: intraday, daily, weekly or monthly.
版本注释
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Version 4.0
■ Updates to the real range to account for gap downs.
Does the mini coil work for shorting as well?? Or is it only reliable for longs?
JohnMuchow
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I have not tried using the indicator for short selling so I don't have any insight that I can share.
MladenSusanj
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Very nice setup tool! Is there any number of days after the last bar of the mini-coil formation, after which mini-coil breakout should not be considered as entry point? for example; we have mini-coil of 4 bars, but - the breakout of the initial bar high point happens on 7th bar (and not on 5th, which would be the bar following the mini-coil pattern). Would this be valid entry point?
JohnMuchow
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My understanding is that the break above the initial bar is the entry. You might consider reaching out to Matt for more information.
JohnStrong
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it's really a precious tool to better interpret the price action
JohnMuchow
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Thanks John!
pg2201
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Great stuff! Thanks for sharing. Could we please enable this for lower timeframes (than daily) as well?