Appreciate some help to understand this Trail Stop Code

AFL Programming
1

Hi there, I have recently found this Trail stop Code but can't get my handle to understand it so any help is appreciated. Thanks in advance...

Buy=Buy1; // Buy1 is the buy condition that trigger the buy action
Short=Sell1; // Same usage as Buy1

Sell=0;
Cover=0;

SL=Param("trailing stop %", 0.4, 0.1, 10, 0.1);
StopLevel1 = 1 - SL/100;
StopLevel2 = 1 + SL/100;


trailARRAY =trailARRAYs= Null; // why need trail array here where it can't just use the trailstop array?
trailstop =tstop= 0; // why 2 different trailstop array for the same function
for( i = 1; i < BarCount; i++ )
{

   if( trailstop == 0 AND Buy[ i ] ) 
   { 
      trailstop = High[ i ] * stoplevel1;
   }
   else Buy[ i ] = 0; // remove excess buy signals // how this remove excess signal?

   if( trailstop > 0 AND (Low[ i ] < trailstop OR Sell1[i]) ) // what does this line mean?
   {
      Sell[ i ] = 1;
      SellPrice[ i ] = trailstop;
      trailstop = 0;
   }

   if( trailstop > 0 )
   {   
      trailstop = Max( High[ i ] * stoplevel1, trailstop );
      trailARRAY[ i ] = trailstop;
   }
	if( tstop == 0 AND Short[ i ])  // Is this triggering of 2nd level of Trail stop?
   { 
      tstop = Low[ i ]*stoplevel2;
   }
   else Short[ i ] = 0; // remove excess buy signals // how this remove excess signal?

   if( tstop > 0 AND (High[i]>tstop OR Buy1[i]) )
   {
      Cover[ i ] = 1;
      CoverPrice[ i ] = tstop;
      tstop= 0;
   }

   if( tstop> 0 )
   {   
      tstop= Min( Low[ i ]*stoplevel2, tstop);
      trailARRAYs[ i ] = tstop;
   }
}type or paste code here

Again, thanks in advance for all the help :slight_smile:

2

When you post some random code, always cite its reference unless you own or wrote the code yourself.
Also ask the source these questions so you will get a clear answer.

why need trail array here where it can't just use the trailstop array?

There are two Arrays, each one for StopLevel1 and StopLevel2.

why 2 different trailstop array for the same function

These are not arrays, they are scalar/numeric variables that hold the recent SL levels. It is also being used to determine if the at the current bar, whether it is IN-TRADE or not.

remove excess buy signals // how this remove excess signal?

If In-TRADE checked by trailstop == 0, then Buy[i], means current bar is set to 0 so any buy signal if present is set to 0. This means a previous Buy exists and if any new or successive buy signal should be removed by setting to 0.
Same story for SELL Array.

3

Hi Travick,
Thanks for taking the time to answer the question.
The code was from about 7 - 8 yrs ago and I can't recall where it's from so can get the sources to offer any help. If was what I thought an effective stop but I don't know how the mechanism work ...
Your answer straight away end years of agony that I suffer from trying to understand how this works... (hours of staring at it, pulling out hair.. u know the drill :confounded:...same goes for array stuff.. re-read the manual about 8 times.. still can't get it...) though I still don't fully comprehend the logic, you answer show me a totally different light on this.. still need more hour of staring and going thru again...
Again, thanks so much for this :+1::smile: