Early New York Session manipulation strategy

In this strategy, we explore the concept of market manipulation during the 9:30 AM New York Stock Exchange (NYSE) open. It focuses on observing price action within a specified window around the market open, detecting potential manipulation, and entering an opposite trade using Fibonacci retracement levels for entries and exits.

Here’s a Pine Script strategy in version 4 that implements this concept:

Pine Script Strategy

//@version=4
strategy("9:30 AM Market Open Manipulation with Fibonacci Levels", overlay=true)

// Input parameters
fibLevel1 = input(0.382, title="Fibonacci Level 1 (38.2%)")
fibLevel2 = input(0.618, title="Fibonacci Level 2 (61.8%)")
tradeWindowMinutes = input(15, title="Trade Window After Market Open (in minutes)")
stopLossPerc = input(1.0, title="Stop Loss (%)")
takeProfitPerc = input(2.0, title="Take Profit (%)")

// Convert 9:30 AM to exchange time
openTime = timestamp("America/New_York", year, month, dayofmonth, 9, 30)
tradeWindowEndTime = openTime + tradeWindowMinutes * 60 * 1000

// Variables to store manipulation detection
var float highPrice = na
var float lowPrice = na
var bool manipulationDetected = false
var int tradeDirection = 0  // 1 for long, -1 for short

// Detect price movement after 9:30 AM open
if (time >= openTime and time <= tradeWindowEndTime)
    highPrice := na(highPrice) ? high : max(highPrice, high)
    lowPrice := na(lowPrice) ? low : min(lowPrice, low)

    // Manipulation detection: If price moves in one direction and reverses quickly
    if (high == highPrice and close < lowPrice)
        manipulationDetected := true
        tradeDirection := 1  // Enter long on reversal
    else if (low == lowPrice and close > highPrice)
        manipulationDetected := true
        tradeDirection := -1  // Enter short on reversal

// Fibonacci levels for entry and exit
if (manipulationDetected)
    // Calculate the Fib retracement levels based on the price range after manipulation
    fibRange = highPrice - lowPrice
    fibLevel_1 = lowPrice + fibLevel1 * fibRange
    fibLevel_2 = lowPrice + fibLevel2 * fibRange
    
    // Enter trade based on manipulation direction and Fibonacci levels
    if (tradeDirection == 1)  // Enter long
        strategy.entry("Long", strategy.long)
        stopLoss = lowPrice * (1 - stopLossPerc / 100)
        takeProfit = close + takeProfitPerc / 100 * close
        strategy.exit("Take Profit/Stop Loss", "Long", stop=stopLoss, limit=takeProfit)

    else if (tradeDirection == -1)  // Enter short
        strategy.entry("Short", strategy.short)
        stopLoss = highPrice * (1 + stopLossPerc / 100)
        takeProfit = close - takeProfitPerc / 100 * close
        strategy.exit("Take Profit/Stop Loss", "Short", stop=stopLoss, limit=takeProfit)

// Plot Fibonacci levels
plot(manipulationDetected ? fibLevel_1 : na, color=color.green, linewidth=2, title="Fib Level 38.2%")
plot(manipulationDetected ? fibLevel_2 : na, color=color.red, linewidth=2, title="Fib Level 61.8%")

How the Strategy Works:

1. Market Open Detection:
   • The script detects the 9:30 AM New York Stock Exchange (NYSE) open using the timestamp function.
   • It then monitors the price for a specified window (e.g., 15 minutes) to capture potential manipulation.
2. Manipulation Detection:
   • The strategy tracks the highest and lowest prices during the trade window and checks if a “manipulation” occurs. A simple example of manipulation here is when the price makes a new high or low but then reverses sharply in the opposite direction.
3. Fibonacci Levels:
   • Once manipulation is detected, Fibonacci retracement levels (38.2% and 61.8%) are calculated based on the high and low prices during the manipulation.
   • These levels are used as reference points for entries and exits.
4. Trade Execution:
   • If the script detects a downward manipulation followed by an upward reversal, it enters a long position.
   • If it detects an upward manipulation followed by a downward reversal, it enters a short position.
   • Stop loss and take profit levels are calculated as a percentage of the entry price.
5. Stop Loss and Take Profit:
   • The strategy uses input-defined stop loss and take profit levels based on percentages.

Parameters:

• Fibonacci Levels: You can adjust the Fibonacci levels used in the retracement calculation (fibLevel1 and fibLevel2).
• Trade Window: The script monitors price action for a configurable period after the market open (default: 15 minutes).
• Risk Management: Stop loss and take profit percentages can be adjusted according to your preferences.

This strategy provides a basic structure for detecting market manipulation around the 9:30 AM open and entering trades using Fibonacci levels. You can further refine the manipulation detection logic and customize the strategy based on your trading needs.