Trading Strategies
Comprehensive documentation for algorithmic trading strategies. Explore trend-following, mean-reversion, momentum, and breakout strategies with detailed explanations and configuration examples.
breakout
calendar
mean reversion
momentum
technical ratings
trend following
breakout Strategies
Chandelier Exit Breakout
A volatility-based momentum strategy that uses the Chandelier Exit indicator to identify entry and exit points. The Chandelier Exit calculates dynamic support and resistance levels based on the Average True Range (ATR), which adjusts to market volatility. Enters long when price breaks above the long Chandelier Exit line and short when price breaks below the short Chandelier Exit line.
Donchian Channel
A classic breakout strategy (Turtle Trading) using the highest high and lowest low over N periods. Buy on upper channel breakout, sell on lower channel breakout.
Fractal Breakout
A breakout strategy based on Bill Williams' Fractal indicator that identifies potential reversal points in price action. Trades breakouts beyond confirmed fractals, with exits at opposing fractals indicating trend reversals.
Keltner Channel
A breakout strategy using channels based on EMA and ATR (Average True Range). Similar to Bollinger Bands but uses ATR instead of standard deviation, making it less sensitive to volatility spikes.
Standard Deviation Breakout
A volatility-based breakout strategy that identifies significant price movements by measuring when price deviates beyond normal volatility levels from its moving average. Uses statistical thresholds based on standard deviation to detect unusual price behavior signaling potential trend starts.
Volatility Contraction Pattern VCP
The Volatility Contraction Pattern (VCP) strategy is based on Mark Minervini's methodology for identifying stocks undergoing a series of tightening price consolidations before a breakout. The pattern is characterized by progressively smaller price pullbacks (contractions) that indicate decreasing selling pressure and accumulation by institutional investors. A valid VCP consists of multiple consolidation phases where each successive pullback is shallower than the previous one, creating a pattern of contracting volatility.
calendar Strategies
Friday Effect
A weekly calendar anomaly strategy that exploits the tendency for stock returns to be positive or higher on Fridays.
January Small Cap Tilt
A pure-time tilt toward small-cap exposure that rides the January effect, entering at the December close and exiting at the January close.
Monday Effect
A weekly calendar anomaly strategy that exploits the tendency for stock returns to be negative or lower on Mondays (Weekend Effect).
Monthly Flow
A calendar-based strategy that exploits predictable monthly flow effects by entering and exiting positions at specific trading days within each monthly cycle.
Monthly Scheduled Buy
A systematic dollar-cost averaging strategy that buys on a specific day of each month and holds positions permanently. Never sells - only accumulates positions over time.
Sell in May (Halloween)
A seasonal window that stays long from November through April and exits in May, exploiting the so-called Halloween effect when equity strength is historically higher.
Turn of Month
A classic calendar anomaly strategy that exploits the turn-of-month effect. Buys 1 trading day before month-end and sells 3 trading days into the new month.
Turnaround Tuesday
A weekly calendar anomaly strategy that exploits the tendency for markets to reverse direction on Tuesdays following significant Monday declines.
Weekly Scheduled Buy
A systematic dollar-cost averaging strategy that buys on a specific day of each week and holds positions permanently. Never sells - only accumulates positions over time.
mean reversion Strategies
ATR Percentage (ATRP)
A volatility mean-reversion strategy that normalizes ATR as a percentage of price (ATRP) to identify extreme volatility conditions and trade the expected return to normal volatility levels.
Bollinger Bands
A mean reversion strategy that trades when price touches the outer Bollinger Bands, expecting price to return to the middle band (moving average).
Bollinger Reversion
A pure mean-reversion strategy that trades price extremes beyond Bollinger Bands, expecting price to revert back toward the middle band. This contrarian approach profits from price exhaustion rather than trend continuation, entering when price penetrates the outer bands and exiting when price returns to the moving average centerline.
CCI Mean Reversion
A mean reversion variant of CCI that fades extremes instead of riding momentum.
CLV Mean Reversion
A pure price-action mean reversion strategy using Close Location Value to identify extremes.
Connors RSI (CRSI)
A composite momentum oscillator combining three components (RSI of price, RSI of streak, and percent rank of returns) to identify extreme short-term oversold and overbought conditions for mean reversion trades.
Consecutive Down Days + Percentage
A pattern-based mean reversion strategy that identifies specific sequences of consecutive declining closes with cumulative decline thresholds and volume confirmation.
Detrended Price Oscillator (DPO)
A technical indicator designed to eliminate the trend from price action and focus on short-term cycles. Developed by William Blau, the DPO removes longer-term trends by comparing a past price to a displaced moving average, making it useful for identifying overbought and oversold conditions within cyclical price movements.
Ergodic Oscillator
A momentum indicator developed by William Blau that applies double exponential smoothing to price momentum using True Strength Index (TSI) principles. The indicator oscillates around zero and is particularly effective for identifying overbought and oversold conditions in mean reversion strategies.
Gap Fade
A contrarian strategy that fades large overnight gaps when they occur against the prior trend.
IBS Mean Reversion
A simple yet effective mean reversion strategy that measures where the close lies within the day's range. IBS assumes that very low values indicate short-term selling pressure likely to revert upward, while very high values indicate buying pressure likely to revert downward.
Kairi Relative Index (KRI)
A Japanese mean reversion oscillator that measures the percentage deviation of price from its moving average. "Kairi" translates to "deviation" or "separation," directly quantifying how far price has moved from its mean. Unlike momentum oscillators, KRI provides an intuitive percentage-based measure of price extremes.
Keltner Channel Reversion
A volatility-based mean reversion strategy that uses Keltner Channels (EMA + ATR) to identify extreme price deviations and trade the reversion back toward the channel centerline. Unlike Bollinger Bands which use standard deviation, Keltner Channels employ Average True Range (ATR) as the volatility measure, making them particularly effective for trending markets and more responsive to actual price movement volatility including gaps.
Larry Williams Volatility Channel
A mean-reversion strategy that uses price channels based on the highest high and lowest low over a lookback period. Unlike trend-following breakout strategies, this contrarian approach enters positions when price reaches channel extremes (overbought/oversold) and exits when price reverts to the channel midpoint, capturing mean-reversion moves in ranging markets.
MFI Reversion
A mean reversion strategy using Money Flow Index, a volume-weighted RSI that identifies overbought/oversold conditions.
Moving Average Deviation
A medium-term mean reversion strategy that identifies price deviations below the 50-day moving average with consecutive day confirmation and volume filtering.
Moving Average Deviation (Long Term)
A long-term mean reversion strategy that identifies significant price deviations below the 200-day moving average with extended confirmation periods and dual exit conditions.
Percentage Drop from Previous Close
A mean reversion strategy that tracks cumulative declines over multiple days with minimal recovery, requiring volume confirmation, and exits on gain or recovery.
Percentage Drop from Rolling High
A mean reversion strategy that buys when price drops a specified percentage from its rolling high over a lookback period, with optional volume confirmation, and exits when price recovers.
Pivot Point
Classic floor trader pivot point strategy using daily pivots for support/resistance trading.
PPO Reversion
Fades extreme PPO readings by entering when the Percent Price Oscillator turns back toward the signal line, exiting when the oscillator reverts to zero.
RSI Reversion
A mean reversion strategy using the Relative Strength Index (RSI) to identify overbought and oversold conditions.
Rubber Band
A mean reversion strategy based on Bollinger Bands that treats price behavior like a stretched rubber band—the further price extends from its equilibrium point (SMA), the stronger the force pulling it back. This strategy identifies when price has overstretched beyond statistical boundaries (±2 standard deviations) and enters positions anticipating the elastic snap-back toward the mean, while managing risk by recognizing when the rubber band has broken (trend change) rather than simply stretched.
Standard Error Bands
A statistical volatility channel system that uses linear regression and standard error of the estimate to create dynamic trading bands around a trendline. Unlike Bollinger Bands which measure dispersion around a moving average, Standard Error Bands measure dispersion around a fitted regression line, making them more suitable for trending markets and better at capturing directional bias.
STARC Bands
A volatility-based channel system developed by Manning Stoller that combines a Simple Moving Average with the Average True Range (ATR) to create dynamic trading bands. Unlike Bollinger Bands which use standard deviation, STARC Bands employ ATR—a measure of actual price movement including gaps—making them particularly effective for capturing real market volatility and identifying mean reversion opportunities.
Stochastic
A momentum oscillator that compares current price to its recent range, identifying overbought and oversold conditions.
Ultimate Oscillator Reversion
A multi-timeframe momentum oscillator that uses three different periods (7, 14, 28) to identify divergences between price and momentum, entering on confirmed reversals from oversold/overbought extremes.
Volatility Band Mean Reversion
A systematic mean reversion strategy that uses volatility-adjusted bands around a moving average to identify extreme price deviations and trade the reversion back toward equilibrium. Unlike fixed-width bands, this strategy adapts to changing market conditions by using standard deviation to measure volatility, creating bands that widen during volatile periods and contract during calm periods. The strategy operates on the principle that prices tend to revert to their mean after periods of excessive deviation from statistical norms.
Volume Weighted
A mean reversion strategy using VWAP, which gives more weight to price levels with higher trading volume.
VR Mean Reversion
A volatility-adjusted mean reversion strategy using z-scores with position sizing based on ATR.
VWAP Reversion
A mean reversion strategy using Volume-Weighted Average Price (VWAP) as fair value. Trades reversals when price deviates significantly from VWAP.
Williams %R
A momentum oscillator ranging from -100 to 0 that identifies overbought and oversold conditions. Similar to Stochastic but with inverted scale.
momentum Strategies
52-Week High Breakout
A momentum-based breakout strategy that identifies stocks making new 52-week highs, signaling strong upward momentum and potential trend continuation. Enters when price reaches a new yearly high and exits when price falls below a trailing 52-week high level.
Aroon Oscillator
Momentum-based trend detection that trades the difference between the Aroon Up and Down lines, following zero-line crossovers to ride emerging trends.
ATR Breakout
A volatility-based breakout strategy using ATR bands around price. Enters when price breaks above/below the ATR envelope.
ATR Squeeze
A volatility contraction strategy that identifies low-volatility squeezes and trades the subsequent breakout.
Bollinger Squeeze
A volatility breakout strategy that identifies periods of low volatility (the "squeeze") followed by directional breakouts into high volatility. The squeeze occurs when Bollinger Bands contract to their narrowest levels relative to recent history, indicating market consolidation. The strategy anticipates that these low-volatility periods are followed by significant directional moves, entering on breakouts and exiting when the opposite band is touched.
Breakout
A momentum strategy that enters positions when price breaks above or below a Donchian Channel (highest high or lowest low over a period).
Candlestick Pattern
A pattern-driven strategy using classic candlestick formations with trend and volume filters.
CCI
Commodity Channel Index measures deviation from statistical mean. Identifies cyclical turns and momentum shifts when CCI crosses key levels.
Center of Gravity (CoG) Oscillator
A physics-based momentum oscillator that identifies turning points by calculating the "center of gravity" of price data over a specified period. Developed by John Ehlers, it applies principles from physics to financial markets, treating price movements as having mass and calculating their balance point.
Chande Momentum Oscillator
A zero-line crossover approach that trades the direction implied by the Chande Momentum Oscillator (CMO), emphasizing clean momentum shifts.
Choppiness Index
A volatility indicator that determines whether the market is choppy (trading sideways) or trending. The index ranges from 0 to 100, where values closer to 100 indicate a choppy, sideways market, and values closer to 0 indicate a strong trending market. The strategy trades on the principle that markets alternate between trending and consolidation phases.
Dynamic Zone RSI
An adaptive momentum oscillator that adjusts its overbought and oversold thresholds based on market volatility using probability distributions rather than fixed levels.
EMA Slope
A momentum strategy that trades based on the rate of change (slope) of an EMA rather than price crossovers, identifying trend strength and acceleration.
Fisher Transform
A mathematical transformation that converts price data into a Gaussian normal distribution, making price reversals easier to identify through sharper, more distinct turning points.
Gap Trend
A trend-following strategy that trades in the direction of large gaps confirmed by high volume.
Mass Index Reversal
A volatility-based reversal indicator developed by Donald Dorsey that identifies potential trend reversals by measuring the narrowing and widening of the range between high and low prices. Unlike most indicators, the Mass Index does not provide directional bias but rather identifies when a reversal is likely to occur through "reversal bulges".
Momentum Oscillator
An advanced momentum strategy using Rate of Change (ROC) with adaptive thresholds, volatility normalization, and trend filtering.
Moving Average Envelope Breakout
Trades breakouts and mean-reversion touches of percentage envelopes drawn around a moving average, with extra squeeze and volume filters.
NR7 Breakout
A volatility contraction strategy based on the Narrowest Range of 7 bars pattern.
Period Range Breakout
A daily/weekly strategy that trades breakouts from the period range (first N days of month/week high/low).
Polarized Fractal Efficiency
Measures trend efficiency by comparing the straight-line displacement to the accumulated path length, trading zero-line crossings after smoothing.
Relative Strength
A cross-asset strength rotation strategy based on N-day returns relative to historical performance.
Relative Volatility Index
A volatility-based momentum indicator that measures the direction of volatility rather than price direction. The RVI applies RSI methodology to standard deviation, creating an oscillator that identifies whether upward or downward price movements have higher volatility.
Relative Volume Breakout
A breakout strategy that requires volume confirmation via relative volume spikes.
ROC Momentum
Trades momentum direction by watching the Rate of Change (ROC) oscillator cross the zero line, optionally smoothing the signal to reduce noise.
True Strength Index
Double-smoothed momentum oscillator that combines directional change and confirmation via a signal line to identify clean trend entry points.
Zero-Lag MACD
An accelerated MACD variant that applies zero-lag adjustments to both the MACD line and the signal line, providing earlier momentum crossovers and cleaner histogram behavior.
technical ratings Strategies
Simple Scoring System
A consensus-based strategy that aggregates signals from four technical indicators (RSI, MACD, Moving Average, Stochastic) into a composite score. Each indicator contributes equally (+1, 0, or -1) based on bullish/bearish conditions, and positions are entered when the consensus reaches a threshold.
Weighted Scoring System
An advanced consensus strategy that combines five technical indicators with customizable weights to reflect their relative importance. MACD receives highest weight (3) as primary trend indicator, RSI (2) as momentum gauge, while MA, Stochastic, and Volume each contribute (1). The weighted composite score drives entry/exit decisions with normalized confidence.
trend following Strategies
Adaptive Laguerre Filter
An ATR-tuned four-pole Laguerre filter that adapts its smoothing gamma to market volatility, delivering low-lag signals when conditions trend and extra smoothing when volatility subsides.
ADX Trend
A trend strength strategy using the Average Directional Index (ADX) to measure trend strength and +DI/-DI crossovers for direction. Only trades when trends are strong.
ATR Trailing Stop
A volatility-based trend-following strategy that uses the Average True Range indicator to set dynamic trailing stop levels. The stop adjusts with price movement and volatility, staying closer during low volatility and moving further away during high volatility periods.
DMA Trend
A trend-following strategy using Displaced Moving Averages to reduce lag and identify support/resistance levels through forward or backward displacement.
EMA Ribbon
A trend-following strategy using multiple EMAs arranged in a ribbon to identify trend strength and direction through ribbon expansion and contraction.
Gaussian Filter
A multi-pole Gaussian-weighted filter that emphasizes recent bars while minimizing noise with mathematically optimal smoothing.
Guppy Multiple Moving Average
A ribbon-based trend strategy that compares compact short-term EMAs to longer-term investor EMAs to detect trend strength, breakouts, and reversals.
Heikin-Ashi
A trend-following strategy using modified candlesticks that smooth price action. Reduces noise and makes trends easier to identify.
Ichimoku Cloud
A comprehensive trend-following system using five lines (Tenkan-sen, Kijun-sen, Senkou Span A/B, Chikou Span) to identify trend direction, support/resistance, and momentum.
Jurik Moving Average
Adaptive Jurik Moving Average strategy that balances smoothness with responsiveness using beta-powered smoothing and phase-adjusted adaptive ratios.
Keltner Middle-Band Trend
A momentum-based trend following strategy that uses the Keltner Channel's exponential moving average (EMA) centerline as a dynamic trend filter and entry trigger. Unlike mean reversion strategies that fade extremes, this approach trades in the direction of the prevailing trend by entering positions when price crosses the middle band (EMA) with momentum. The strategy operates on the principle that when price crosses above the EMA, it signals bullish momentum and the potential start or continuation of an uptrend, while crossing below signals bearish momentum.
MACD Cross
A trend-following strategy based on the Moving Average Convergence Divergence (MACD) indicator, which uses exponential moving averages to identify trend changes.
OBV Trend
A volume-driven trend strategy using On-Balance Volume to detect accumulation and distribution.
Parabolic SAR
A trailing stop-and-reverse indicator that provides entry/exit points and acts as a dynamic trailing stop. Dots appear below price in uptrends and above in downtrends.
Rainbow Moving Average
Builds a recursive “rainbow” of smoothed moving averages to track alignment, width, compression, and breakout behavior.
Schaff Trend Cycle
Blends MACD, stochastic, and EMA smoothing to provide a cycle-aware trend oscillator that trades when the Schaff Trend Cycle crosses above/below 50.
SMA Cross
A classic trend-following strategy using two Simple Moving Averages to identify trend direction.
Supertrend
ATR-driven adaptive support/resistance bands that flip between bullish and bearish states, giving a clear directional bias tied to volatility.
Triple EMA
A trend-following strategy using three EMAs that requires all three to align for strong trend confirmation.
Triple SMA Cross
An advanced trend-following strategy using three Simple Moving Averages to identify trend direction through hierarchical crossover patterns.
Vortex Indicator
Follows the dominance switch between the VI+ and VI− lines so you trade in the direction of the stronger momentum trend.
Zero-Lag HMA
A responsive trend-following strategy that uses the Hull Moving Average to follow momentum while minimizing lag through weighted smoothing.
Ready to Test These Strategies?
Configure and backtest these strategies with your own parameters. See how they perform on historical data and find the perfect setup for your trading style.
Start Backtesting