SuperTrend
Trenddraws on the price
An ATR band that ratchets: it may tighten toward price but never loosen away, until price crosses it and the roles flip. Green under price, red over it.
On this chart: 10-period ATR, 3× multiplier.
What it measures
SuperTrend places a band 3 ATRs from the bar midpoint — below price in an uptrend, above in a downtrend — with one crucial rule: the band only ever ratchets toward price, never away. Volatility expanding cannot push the line back. When price closes through the band, the trend flips and the band jumps to the other side.
The ratchet is the entire indicator. Without it, this is just a Keltner band; with it, the line becomes a trailing level that only tightens.
How to read it
Green line under price: uptrend, with the line marking where that classification dies. Red line above: the mirror. The stairstep pattern is the ratchet doing its work — each step records the trend surviving another test at a closer level.
Using it on the wheel
The line is a volatility-scaled reference level: a put strike below a green SuperTrend line sits beyond the distance that, at 3 ATRs, has contained this trend's pullbacks so far. That is a statement about where the strike sits relative to demonstrated volatility — the same shape of reasoning as "one ATR below spot," with the trend's own history doing the calibration.
Like everything in this guide, these are descriptions of conditions and reference levels — context for your own decisions, not instructions to trade.