Trends/Volatility and bands

Chandelier exit

A line that follows below the highest high by a multiple of the average true range, and only moves up.

Volatility and bandsBest on 3M, 6M, 1YAlso called trailing stop line

Illustration of the chandelier exit shape. It is a sketch, not real price data.

What it shows

Chuck LeBeau designed the Chandelier exit as a trailing line. It hangs from the highest high of the last 22 bars, like a chandelier from a ceiling. The distance is 3 times the 22-bar ATR.

It rises when the highs rise and stays put otherwise. A close below it ends the state. We show it as a volatility measure, not as a stop recommendation.

How we find it

The same code that draws it on your chart follows these steps, with the same result every time.

Compute the 22-bar ATR.
Find the highest high of the last 22 bars.
Line = highest high − 3 × ATR.
Keep the line from falling unless price closes below it.

Starting values: Lookback 22; ATR multiplier 3. These are proposed and will be tuned on real price data before launch.

How to read it

The gold line steps up with new highs.
It never moves down while price stays above it.
The gold dot marks a close below the line.

Status labels you may see

Label	What it means
Above the line	Close is above the Chandelier line.
Near the line	Within 2% of it.
Below the line	Close is below the line.

What cancels it

A close below the line ends the state, and the line resets.

What traders check next

The distance between price and the line.
Whether volatility is rising.
How often price has closed below the line.

Limits

It only looks at the past.
Gaps can jump past the line.
The multiplier of 3 is a convention.

Try it in forecastviz

Open any ticker and choose Volatility and bands → Chandelier exit in the left menu.
Switch between 3M, 6M, 1Y to see how the picture changes.
Compare with SuperTrend and Parabolic SAR on the same chart.

Open on a ticker

Questions

Is this a stop loss recommendation?

No. We show the line as a measure of volatility and distance.

Why 22?

It is about one month of trading days.