Parabolic Exhaustion
Spot when a price move has gone too far and is about to reverse
Parabolic Exhaustion detects when a strong price move is running out of steam. When price shoots up or drops too fast, it becomes unsustainable — this indicator catches that moment and warns you that a reversal may be coming.
This indicator works right out of the box. It automatically adjusts its sensitivity to your chart timeframe — whether you're on a 1-minute chart or a daily chart.
What It Does
The indicator watches for price moves that have become "parabolic" — moving too fast in one direction — and then checks for signs that the momentum is fading. When it finds enough evidence, it fires a signal on your chart.
Each signal comes with a confidence level so you know how much to trust it:
| Level | What It Means |
|---|---|
| High confidence (L3/S3) | Multiple factors all agree — this is the strongest reversal signal |
| Medium confidence (L2/S2) | Several factors align — a solid signal that works well on its own |
| Lower confidence (L1/S1) | Early warning — best used with additional confirmation from other indicators |
- L signals = Bullish exhaustion (price dropped too far, may bounce up)
- S signals = Bearish exhaustion (price rose too far, may drop back down)
What You'll See on Your Chart
Signals appear directly on your price chart:
- Green arrows/labels below candles = Bullish signals (potential bounce upward)
- Red arrows/labels above candles = Bearish signals (potential drop)
- Brighter colors = Higher confidence signals
- Fainter colors = Lower confidence signals
The bigger and brighter the signal, the more conviction behind it.
How to Use
Add the indicator to your chart by searching for "Pagani" in TradingView's indicator menu. It starts scanning for exhaustion patterns automatically.
Watch for signals on your chart. Green signals below candles suggest a potential bounce up. Red signals above candles suggest a potential drop.
Focus on medium and high confidence signals (L2/S2 and L3/S3). These have multiple independent factors confirming the exhaustion, making them more reliable.
Check the context. Exhaustion signals near important price levels (like those shown by ICT Order Block Pro) are especially powerful — you have both structural and momentum evidence for a reversal.
Manage your risk. Even the best exhaustion signals don't guarantee a reversal. Always use a stop loss beyond the extreme of the move.
How Signals Are Validated
The indicator doesn't just fire at any price movement. Before a signal appears, it checks for evidence across multiple independent factors:
- Speed check — Is the price move actually parabolic (moving unsustainably fast)?
- Pattern check — Are candle patterns showing rejection (long wicks, engulfing candles)?
- Momentum check — Is the momentum actually slowing down, not just pausing?
- Volume check — Is there a volume climax (spike that often marks the end of a move)?
- Divergence check — Are momentum indicators disagreeing with price direction?
Higher confidence signals have more of these factors aligned. The indicator handles all of this automatically — you just see the final signal and its confidence level.
Trading Tips
Alerts
Parabolic Exhaustion offers alerts for every confidence level:
- High confidence — Get alerted only for the strongest signals (L3/S3)
- Medium and above — Alerts for L2+ and S2+ signals (recommended for most traders)
- All signals — Every signal, including lower confidence L1/S1
See the Alerts Setup guide for instructions on setting up alerts.