Donchian Channel Breakout Signals for TradingView

//@version=5
indicator("Donchian Channel Breakout Signals", overlay=true)

// Input parameters
channelLength = input.int(20, "Channel Length", minval=1, tooltip="Number of bars for the channel high/low range")
useCloseForBreakout = input.bool(true, "Use Close for Breakout", tooltip="If true, use close price instead of high/low for breakout confirmation")
showMiddleLine = input.bool(true, "Show Middle Line")
showChannelWidth = input.bool(false, "Show Channel Width Subplot")
falseBreakoutLookback = input.int(2, "False Breakout Lookback", minval=1, maxval=5)

// Donchian Channel calculation
upperChannel = ta.highest(high, channelLength)
lowerChannel = ta.lowest(low, channelLength)
middleLine = (upperChannel + lowerChannel) / 2

// Breakout conditions
breakoutBuy = useCloseForBreakout ? close > upperChannel : high >= upperChannel
breakoutSell = useCloseForBreakout ? close < lowerChannel : low <= lowerChannel

// Middle line bounce detection
middleBounceBuy = low <= middleLine and close > middleLine and close > open
middleBounceSell = high >= middleLine and close < middleLine and close < open

// Channel width analysis
channelWidth = upperChannel - lowerChannel
channelWidthChange = (channelWidth - channelWidth[5]) / channelWidth[5]

// Contraction threshold: width is at a 40-bar low
widthLowest = channelWidth == ta.lowest(channelWidth, 40)
widthExpansion = channelWidthChange > 0.5

// False breakout detection
fbHighBreak = high >= upperChannel
fbBreakoutHigh = fbHighBreak and not fbHighBreak[1]
falseBreakoutSell = fbBreakoutHigh[falseBreakoutLookback] and close < middleLine

fbLowBreak = low <= lowerChannel
fbBreakoutLow = fbLowBreak and not fbLowBreak[1]
falseBreakoutBuy = fbBreakoutLow[falseBreakoutLookback] and close > middleLine

// Plot Donchian Channel
upperPlot = plot(upperChannel, "Upper Channel", color=#2962FF, linewidth=1)
lowerPlot = plot(lowerChannel, "Lower Channel", color=#2962FF, linewidth=1)
middlePlot = plot(showMiddleLine ? middleLine : na, "Middle Line", color=#2962FF, linewidth=1, style=plot.style_dashed)
fill(upperPlot, lowerPlot, color=color.new(color.blue, 92), title="Channel Fill")

// Buy signal markers
plotshape(breakoutBuy, "Breakout Buy", shape.triangleup, location.belowbar, color=#4CAF50, size=size.small)
plotshape(middleBounceBuy, "Middle Bounce Buy", shape.labelup, location.belowbar, color=#009688, size=size.small)
plotshape(falseBreakoutBuy, "False Breakout Buy", shape.labelup, location.belowbar, color=#00BCD4, size=size.small)

// Sell signal markers
plotshape(breakoutSell, "Breakout Sell", shape.triangledown, location.abovebar, color=#FF5252, size=size.small)
plotshape(middleBounceSell, "Middle Bounce Sell", shape.labeldown, location.abovebar, color=#FF9800, size=size.small)
plotshape(falseBreakoutSell, "False Breakout Sell", shape.labeldown, location.abovebar, color=#E040FB, size=size.small)

// Channel width subplot
plot(showChannelWidth ? channelWidth : na, "Channel Width", color=#757575, style=plot.style_histogram)

// Contraction markers — placed at the high of the bar for visibility
plotshape(widthLowest, "Width Contraction", shape.diamond, location.abovebar, color=color.yellow, size=size.tiny)
plotshape(widthExpansion, "Width Expansion", shape.diamond, location.abovebar, color=color.orange, size=size.tiny)

// Alert conditions
alertcondition(breakoutBuy, "Donchian Breakout Buy", "Price broke above the " + str.tostring(channelLength) + "-period Donchian Channel top")
alertcondition(breakoutSell, "Donchian Breakout Sell", "Price broke below the " + str.tostring(channelLength) + "-period Donchian Channel bottom")
alertcondition(widthLowest, "Donchian Channel Contraction", "Channel width is at a 40-bar low — prepare for expansion")
alertcondition(widthExpansion, "Donchian Channel Expansion", "Channel width expanded more than 50% in 5 bars — momentum confirmed")
alertcondition(falseBreakoutSell, "Donchian False Breakout Sell", "Price faked above the channel and reversed below the middle line")
alertcondition(falseBreakoutBuy, "Donchian False Breakout Buy", "Price faked below the channel and reversed above the middle line")