Frank Birch Veteran   Posts: 171 Joined: 3/25/2006 Location: UK  User Profile | Hi to all, Here is an over view of the system logic. Price Action Criteria: Long Signal: The system looks for an ascending price pattern where each closing price is higher than the previous (C[1] > C[2] and C[2] > C[3]). This suggests a bullish trend. Additionally, the opening price being higher than the most recent closing price (O > C[1]) could indicate a strong bullish sentiment. Short Signal: For a bearish trend, the opposite is true. The system identifies a descending price pattern (C[1] < C[2] and C[2] < C[3]) and an opening price lower than the most recent closing price (O < C[1]), suggesting bearish momentum. Volume Criterion: The system uses volume as a confirmation tool. A signal is only generated if the current volume (V) is greater than the 24-period average volume (AVG(V, 24)). High volume on a trend day reinforces the strength of the current price movement. Application Scenarios Trend Following: This system is ideal in markets that exhibit strong trends. It can be used in stock, forex, or futures markets where price movements tend to follow a trend over time. Swing Trading: The strategy suits swing traders who capitalize on price swings and aim to hold positions for several days to several weeks. Market Phases: Best used in non-choppy, trending markets. It might be less effective during sideways or highly volatile market conditions. Regards Frank Birch | |
