52-Week High Drawdown (Events, Freq & Current)

52-Week High Drawdown - Events, Freq & Current

OVERVIEW
Track and analyze drawdowns from 52-week highs with comprehensive statistics on drawdown events, frequency, and current market positioning. Perfect for risk management, historical analysis, and understanding volatility patterns.

KEY FEATURES

📊 Real-Time Drawdown Tracking

• Visual area chart showing current intraday maximum drawdown from rolling high
  
• Automatically plots depth below zero line for easy interpretation
  
• Color-coded reference lines at -10% and -20% levels
  

📈 Event-Based Historical Analysis
Automatically categorizes drawdown cycles across four severity zones:

• 5-10% Drawdowns - Minor corrections
  
• 10-15% Drawdowns - Moderate pullbacks
  
• 15-20% Drawdowns - Significant corrections
  
• 20%+ Drawdowns - Major corrections/bear markets
  

⏱️ Frequency Metrics
Calculates average time between events for each category, displayed as "Every X months" to understand typical correction patterns.

🎯 Current Cycle Tracking
Real-time display of maximum drawdown depth in the current cycle, helping you gauge present market position.

📅 Smart Timeframe Adaptation

• Auto-Adjust Mode: Automatically selects optimal lookback (Daily=252, Weekly=52, Monthly=12)
  
• Manual Mode: Set custom lookback period for specialized analysis
  

HOW IT WORKS

The indicator identifies drawdown cycles - periods from one high to the next. When price touches a new rolling high, the previous cycle ends and is categorized by its maximum depth.

Cycle Logic:

1. Tracks deepest point reached since last high
   
2. When price touches/exceeds rolling high, cycle completes
   
3. Cycle categorized into appropriate drawdown zone
   
4. New cycle begins
   

This provides accurate event counting without double-counting fluctuations within larger drawdowns.

PRACTICAL APPLICATIONS

Risk Management

• Understand typical drawdown patterns for position sizing
  
• Set realistic stop-loss levels based on historical norms
  
• Anticipate potential correction depths during bull markets
  

Market Context

• Identify when current drawdowns are extreme vs. typical
  
• Compare across different assets and timeframes
  
• Historical perspective during volatile periods
  

Strategic Planning

• Time entries during typical correction zones
  
• Recognize when drawdowns exceed historical norms
  
• Build resilience strategies based on frequency data
  

SETTINGS GUIDE

Auto-Adjust Lookback by Timeframe

• Checked: Automatically uses appropriate period for chart timeframe
  
• Unchecked: Uses manual lookback value
  

Manual Lookback Length

• Default: 252 (trading days in a year)
  
• Customize for specific analysis periods
  
• Higher values = longer historical perspective
  

Table Position
Choose from Top Right, Bottom Right, Top Left, or Bottom Left based on your chart layout.

INTERPRETATION TIPS

• Frequency data becomes more reliable with longer history (5+ years ideal)
  
• "Never" frequency indicates zero events in available data range
  
• Current Cycle Max shows 0.00% at new highs, otherwise displays deepest point
  
• Compare frequencies across assets to understand relative volatility profiles
  

BEST USED FOR

• Stocks, ETFs, and Indices with sufficient historical data
  
• Long-term investing and swing trading strategies
  
• Portfolio risk assessment and stress testing
  
• Educational purposes - understanding market behavior
  
• Multi-timeframe analysis (daily, weekly, monthly)
  

TECHNICAL NOTES

• Uses ta.highest() for efficient rolling high calculation
  
• Event detection logic prevents double-counting
  
• Frequency calculated from actual data start time to present
  
• All calculations update in real-time with each new bar
  

💡 Tip: Run this indicator on major indices like SPY or QQQ with maximum available history to build a comprehensive baseline for equity market corrections.

Created to provide institutional-grade drawdown analysis in an accessible format. Free to use and modify.