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Fractalstrategy

Fractal Breakout Trend Following StrategyOverview The Fractal Breakout Trend Following Strategy is a trend-following system which utilizes the Willams Fractals and Alligator to execute the long trades on the fractal's breakouts which have a high probability to be the new uptrend phase beginning. This system also uses the normalized Average True Range indicator to filter trades after a large moves, because it's more likely to see the trend continuation after a consolidation period. Strategy can execute only long trades. Unique Features Trend and volatility filtering system: Strategy uses Williams Alligator to filter the counter-trend fractals breakouts and normalized Average True Range to avoid the trades after large moves, when volatility is high Configurable Trading Periods: Users can tailor the strategy to specific market windows, adapting to different market conditions. Flexible Risk Management: Users can choose the stop-loss percent (by default = 3%) for trades, but strategy also has the dynamic stop-loss level using down fractals. Methodology The strategy places stop order at the last valid fractal breakout level. Validity of this fractal is defined by the Williams Alligator indicator. If at the moment of time when price breaking the last fractal price is higher than Alligator's teeth line (8 period SMA shifted 5 bars in the future) this is a valid breakout. Moreover strategy has the additional volatility filtering system using normalized ATR. It calculates the average normalized ATR for last user-defined number of bars and if this value lower than the user-defined threshold value the long trade is executed. When trade is opened, script places the stop loss at the price higher of two levels: user defined stop-loss from the position entry price or down fractal validation level. The down fractal is valid with the rule, opposite as the up fractal validation. Price shall break to the downside the last down fractal below the Willians Alligator's teeth line. Strategy has no fixed take profit. Exit level changes with the down fractal validation level. If price is in strong uptrend trade is going to be active until last down fractal is not valid. Strategy closes trade when price hits the down fractal validation level. Risk Management The strategy employs a combined approach to risk management: It allows positions to ride the trend as long as the price continues to move favorably, aiming to capture significant price movements. It features a user-defined stop-loss parameter to mitigate risks based on individual risk tolerance. By default, this stop-loss is set to a 3% drop from the entry point, but it can be adjusted according to the trader's preferences. Justification of Methodology This strategy leverages Williams Fractals to open long trade when price has broken the key resistance level to the upside. This resistance level is the last up fractal and is shall be broken above the Williams Alligator's teeth line to be qualified as the valid breakout according to this strategy. The Alligator filtering increases the probability to avoid the false breakouts against the current trend. Moreover strategy has an additional filter using Average True Range(ATR) indicator. If average value of ATR for the last user-defined number of bars is lower than user-defined threshold strategy can open the long trade according to open trade condition above. The logic here is following: we want to open trades after period of price consolidation inside the range because before and after a big move price is more likely to be in sideways, but we need a trend move to have a profit. Another one important feature is how the exit condition is defined. On the one hand, strategy has the user-defined stop-loss (3% below the entry price by default). It's made to give users the opportunity to restrict their losses according to their risk-tolerance. On the other hand, strategy utilizes the dynamic exit level which is defined by down fractal activation. If we assume the breaking up fractal is the beginning of the uptrend, breaking down fractal can be the start of downtrend phase. We don't want to be in long trade if there is a high probability of reversal to the downside. This approach helps to not keep open trade if trend is not developing and hold it if price continues going up. Backtest Results Operating window: Date range of backtests is 2023.01.01 - 2024.05.01. It is chosen to let the strategy to close all opened positions. Commission and Slippage: Includes a standard Binance commission of 0.1% and accounts for possible slippage over 5 ticks. Initial capital: 10000 USDT Percent of capital used in every trade: 30% Maximum Single Position Loss: -3.19% Maximum Single Profit: +24.97% Net Profit: +3036.90 USDT (+30.37%) Total Trades: 83 (28.92% win rate) Profit Factor: 1.953 Maximum Accumulated Loss: 963.98 USDT (-8.29%) Average Profit per Trade: 36.59 USDT (+1.12%) Average Trade Duration: 72 hours These results are obtained with realistic parameters representing trading conditions observed at major exchanges such as Binance and with realistic trading portfolio usage parameters. How to Use Add the script to favorites for easy access. Apply to the desired timeframe and chart (optimal performance observed on 4h and higher time frames and the BTC/USDT). Configure settings using the dropdown choice list in the built-in menu. Set up alerts to automate strategy positions through web hook with the text: {{strategy.order.alert_message}} Disclaimer: Educational and informational tool reflecting Skyrex commitment to informed trading. Past performance does not guarantee future results. Test strategies in a simulated environment before live implementation
Pine Script® strategy
by Skyrexio
1
RSI Fractal Energy with Signal LineHere is my second script. Introducing the RSI Fractal Energy Indicator. This incorporates the Relative-Strength Index and Fractal Energy as the name implies. This will help the trader identify: 1. Trend Strength: The higher the value of the indicator can indicate the strength of the trend and vice versa. 2. Reversal points: If the indicator is showing weakness and the market is making higher highs and lower lows this can indicate a reversal is possible. 3. Overbought and Oversold conditions: This indicator is currently set to 30(Oversold) and 70(Overbought), but this can be changed in the source code. I also added a signal line to provide bullish/bearish crossovers. I use this indicator on the 1 hr chart, but it can be used on any time frame. Please let me know if you have any questions, comments, or concerns. Always open to learning more. I will also provide updates as I continue to use my indicators. Happy trading!
Pine Script® indicator
by JohnCabernet
2
Market Structure CHoCH/BOS (Fractal) [LuxAlgo]The Market Structure CHoCH/BOS (Fractal) indicator is an experimental take on classical market structure, whereas fractal patterns are used for their construction instead of swing points. Compared to utilizing swing points for highlighting market structure like our Smart Money Concepts indicator , fractal-based market structure can appear as more adaptive, however, it can also be more restrictive when it comes to returning swing points which can cause the indicator to miss reversals in some cases. If enabled from within the settings, users can see support and resistance levels returned from the detected market structure with breakouts highlighted on the chart. Alongside this feature, an additional dashboard showing the structure to fractal structure percentage is also provided. 🔶 SETTINGS Length: Length of the fractal patterns to detect. 🔹 Style Bullish Structures: Show bullish structures. Bearish Structures: Show bullish structures. Support: Show support levels. Resistance: Show resistance levels. 🔹 Dashboard Show Dashboard: Show structure to fractal percentage dashboard on the chart. Location: Location of the dashboard on the chart. Size: Dashboard size. 🔶 USAGE Market structure is commonly used to determine trend direction by using price positions relative to prior swing points. Using fractal patterns to determine market structure can allow users to obtain shorter, more frequent structure labels. Market structure is commonly classified as follows: Change of Character (CHoCH), also referred to as Market Structure Shift (MSS) Break of Structure (BOS), also referred to as Market Structure Break (MSB) Change of Characters indicate a shift in the market trend, confirming trend reversals. Break of Structures on the other hand occur once a trend is already determined, confirming new higher highs/lower lows. Using higher length values allow users to detect longer-term fractals, thus highlighting longer-term market structures. The image above detects fractal patterns made of 7 candles, even if the increment is only of 2 bars this significantly reduces the amount of detected market structure labels. The result obtained by utilizing fractals and higher settings can be a more dynamic view of market structure, however, as seen in the image above this can introduce very significant delay compared to utilizing pure swing points. 🔹 Support/Resistance The indicator also returns support/resistance levels constructed from the market structure, these levels are obtained similarly to order blocks, finding the minimum on the interval of a bullish market structure and the maximum of a bearish market structure. Price reaching a support/resistance level can be expected to bounce from it. Once a level is broken, the support/resistance level will no longer extend, and a circle will be displayed highlighting the break. While utilizing this script for fractal-based market structure, these levels can be useful to ensure all swing points are still considered by the user with the possibility of the indicator missing reversals due to its calculation not being based on swing points themselves. 🔹 Dashboard The dashboard reports the structure to fractal percentage, that is the amount of bullish/bearish market structures relative to the total amount of detected bullish/bearish fractal patterns. This allows us to see how often a detected fractal pattern is used to display a market structure. 🔶 DETAILS 🔹 Fractals In the context of technical analysis, Fractals refer to specific patterns that exhibit self-similarity at different scales or timeframes. The most commonly known fractal pattern consists of a consecutive sequence of candles (more commonly 5), with the central candle being the lowest (in case of a bullish fractal) or highest (in case of a bearish fractal). A bullish fractal has candles on the right side of the central candle with increasing lows, while candles on the left side have decreasing lows. A bearish fractal has candles on the right side of the central candle with decreasing highs, while candles on the left side have increasing highs. 🔶 RELATED SCRIPTS 🔹 Smart Money Concepts 🔹 Market Structure Trailing Stop 🔹 ICT Concepts
Pine Script® indicator
by LuxAlgo
35
Fractal Breakout StrategyFractal A type of pattern used in technical analysis to predict a reversal in the current trend. A fractal pattern consists of five bars and is identified when the price meets the following characteristics: 1. A shift from a downtrend to an uptrend occurs when the lowest bar is located in the middle of the pattern and two bars with successively higher lows are positioned around it. 2. A shift from an uptrend to a downtrend occurs when the highest bar is located in the middle of the pattern and two bars with successively lower highs are positioned around it.
Pine Script® strategy
by ceyhun
13