What is Supertrend Indicator?
Supertrend flips color when price crosses ATR-based band — long below, short above (settings vary).
Formula
Upper Band = (High + Low) / 2 + Multiplier × ATR(Period) Lower Band = (High + Low) / 2 − Multiplier × ATR(Period)
Indian market context (NSE)
Reference levels: Nifty 50 at 24,300, Reliance Industries at ₹1,300, Bank Nifty futures at 55,000 (lot size 30). Examples below show how Supertrend Indicator shows up on Indian index, equity, and futures books — update to live quotes in your journal.
Nifty 50 perspective
Supertrend on Nifty (24,300): on the 15-minute chart, combine with session VWAP and 9:15–10:00 liquidity — index supertrend signals misfire on expiry Tuesdays without volume confirmation.
Reliance Industries perspective
Supertrend on Reliance at ₹1,300: daily vs hourly settings diverge around results and ex-dividend dates; note corporate events in journal when supertrend readings spike.
Bank Nifty futures perspective
Supertrend on Bank Nifty futures (55,000): first-hour signals differ from post-14:30 behaviour; avoid standalone entries when banking names lead the move.
How to validate
- Forward-test Supertrend Indicator on paper or sim for two weeks after rule changes.
- Validate only on trades where Supertrend Indicator settings matched the written playbook.
- Split results by trending vs range weeks on Nifty before trusting the signal.
- Require higher-timeframe bias agreement if that is part of your rule.
How to track in TradeLyser
- Add Supertrend Indicator reading to trade entry notes (value + timeframe).
- Create tags: “Supertrend Indicator aligned” / “Supertrend Indicator ignored”.
- Monthly: filter trades by alignment tag and compare win rate and avg R.
- Screenshot chart context for mentor review on disputed trades.
Best practices
- Combine Supertrend Indicator with higher-timeframe bias — not as a lone trigger.
- Avoid curve-fitting settings on less than three months of tagged data.
- Refresh playbook screenshots when changing Supertrend Indicator parameters.
- Skip trading when Supertrend Indicator conflicts with written risk limits.
Common pitfalls
- Treating Supertrend Indicator as a guaranteed reversal signal.
- Optimising parameters on one bullish month only.
- Trading against higher-timeframe bias because Supertrend Indicator “said so”.
- Failing to log when you overrode Supertrend Indicator discretionally.
How to use this in TradeLyser
Log supertrend period/multiplier; review flip vs structure entries separately.
Related terms
Average True Range smooths true range over N bars — volatility in price units.
Day trading opens and closes positions within the same session, avoiding overnight gap risk on cash products.
Parabolic SAR plots dots above/below price accelerating with trend — flip suggests reversal.
Trend following enters in direction of the prevailing trend and holds until trend rules exit.
FAQ
Supertrend alone enough?
Add session filter for Nifty open noise.
Repaint concerns?
Use closed-bar signals only for journaling.
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