The True Low helps avoid getting into a trade too late or too early. Allison wanted to have confidence avoiding false signals and getting into a trade prior to a bullish run, thus developed the True Low indicator. True Lows is similar to Allison's Compound Breakout Tool in that it combines multiple signals into one study. Four standard indicators are in an easy to read study; the goal is to remove as many false signals and noise on the chart as possible while at the same time indicating not only potential lows, but when the discounting of price may be occurring.
The unique relationship of Allison's Divergent Bars along with custom settings of RSI, MACD and Stochastics built into the True Lows Study allows the trader to see congruence for potential buys and helps determine when a pullback or selling off has finished; and when a good time might be to buy in for a run to come.
For longer time frames, True Lows can also be considered as a buy signal to sit and hold long term. Allison may use the 1 hour, 4hour, Daily, Weekly and Monthly time frames with this study. This study also pairs well with Bollinger Bands and Top Hats.
When a light colored box prints its a setup, when a bigger box prints then everything is in agreement for the setup ("stronger" setup). The triangle is what Allison calls the "cherry on top" for the sweetest entry.
A True Low signal occurs if a box prints.
If the bigger (dark blue) box prints, then all the True Lows study conditions are in agreement.
If a triangle prints there is a better probability of starting to show immediate follow through on a True Lows signal.
How to read the Compound Breakout Tool