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The Compounder AI

  • Writer: Sandra Wakefield
    Sandra Wakefield
  • 40 minutes ago
  • 3 min read

The Compounder [PSRC] v3 User Manual



Overview

The Compounder [PSRC] is a professional liquidity-reversion framework designed to identify high-probability institutional reversal opportunities.


Unlike traditional retail indicators that enter immediately after a liquidity sweep, The Compounder requires a complete institutional sequence:


Higher Time Frame Analysis → Volume Analysis → Liquidity Sweep → Market Structure Shift (MSS) → Fair Value Gap (FVG) → Retest → Entry


In essence, The Compounder is ICT but upgraded to institutional grade logic.


For the paid fully autonomous system, contact us.


The goal is to reduce low-quality trades and focus only on setups where multiple forms of institutional confirmation align.


Core Philosophy


Markets move toward liquidity.


Retail traders typically place stops:

  • Above previous highs

  • Below previous lows


Large participants often sweep these liquidity pools before initiating the true move.

The Compounder attempts to identify those sweeps and wait for confirmation before generating a signal.


Trading Sequence


Step 1: Liquidity Sweep


The indicator monitors:

  • Previous Day High (PDH)

  • Previous Day Low (PDL)

And five ladder extensions:

  • L1 = 25%

  • L2 = 50%

  • L3 = 75%

  • L4 = 100%

  • L5 = 125%

A sweep occurs when price trades beyond one of these levels and rejects back inside.


Step 2: Market Structure Shift (MSS)


After the sweep, price must demonstrate a change in market structure.


Bullish MSS:

  • Break of recent swing high

Bearish MSS:

  • Break of recent swing low

No MSS = No Trade


Step 3: Fair Value Gap (FVG)


Following MSS, the indicator requires a Fair Value Gap.


Bullish FVG:

  • Current low above high two candles back

Bearish FVG:

  • Current high below low two candles back


This identifies institutional imbalance.


Step 4: Retest


Price must return to the FVG zone.


The indicator waits for this retracement.


No retest = No Trade


Step 5: Signal


A BUY or SELL signal is generated only when all previous conditions have occurred.

This creates significantly fewer signals but improves selectivity.


Dashboard Components


Daily Bias

Determined by Daily EMA trend.

Bullish:

  • Daily Close > Daily EMA

Bearish:

  • Daily Close < Daily EMA


HTF Filter

User selectable:

Option 1:

  • H4 EMA 200

Option 2:

  • H4 EMA 20

  • Daily EMA 50

Trades are filtered according to higher-timeframe trend.


VWAP

Institutional volume-weighted bias.

Bullish:

  • Price above VWAP

Bearish:

  • Price below VWAP


Sweep Status

Displays:

  • Lower Raid Armed

  • Upper Raid Armed

  • None


MSS Status

Displays:

  • Bull MSS

  • Bear MSS

  • Pending


FVG Status

Displays:

  • Bull FVG

  • Bear FVG

  • Pending


Retest Status

Displays:

  • Bull Retest

  • Bear Retest

  • Pending


Score Engine


Every setup receives a score.

Factors include:

  • Liquidity sweep

  • MSS

  • FVG

  • Retest

  • Trend alignment

  • VWAP alignment

  • Session alignment

Higher scores indicate stronger confluence.


Trend Day Protection


The indicator attempts to identify expansion days where mean-reversion trades are statistically weaker.


When triggered:

"Danger"

appears on the dashboard.


Exercise additional caution during these conditions.


L4 Breach Warning


L4 represents a 100% daily-range expansion beyond PDH or PDL.

An L4 Breach often signals:

  • Institutional expansion

  • Trend continuation

  • Elevated volatility

These environments may be less favorable for reversal trades.


Best Markets

The Compounder was designed primarily for:

  • XAUUSD

  • US30

  • NAS100

  • S&P500

  • EURUSD

  • GBPUSD

  • USDJPY



Recommended Timeframes


Primary:

  • M5

  • M15


Secondary:

  • M1 (advanced users)


Higher:

  • M30 for swing-style entries


Recommended Sessions


Highest-quality setups generally occur during:

  • London Kill Zone

  • New York Kill Zone

Avoid low-liquidity periods whenever possible.


Risk Management


Never risk more than 1–2% of account equity per trade.

Suggested workflow:

  1. Wait for signal.

  2. Place stop beyond sweep extreme.

  3. Scale partial profits.

  4. Move stop to breakeven after partial.

  5. Allow remainder to seek higher R multiples.


For the paid fully autonomous system, contact us.


Disclaimer

This indicator is an educational and analytical tool. No indicator can guarantee future performance. Always test thoroughly before deploying live capital.


Plazo Sullivan Roche Capital

Research & Development Division

 

 
 
 

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