Bidirectional Trend Reversal Strategy

13 Sep

Bidirectional Trend Reversal Strategy

This strategy aims to identify potential trend reversals and execute trades accordingly, focusing on both long and short positions. It uses a crossover of the Simple Moving Average (SMA) with price action as a key signal. When the price crosses above the SMA and the previous period was bearish (closed lower than it opened), the script opens a long position ("o-Long"). The exit ("e-Long") occurs when the target or stop-loss levels are hit, which are dynamically set using the ATR (Average True Range).

For short trades, when the price crosses below the SMA and the previous period was bullish (closed higher than it opened), the script opens a short position ("o-Short"). The exit ("e-Short") follows the same ATR-based logic for stop-loss and take-profit.

All settings, including SMA and ATR parameters, are fully customizable, allowing users to adapt the strategy to different market conditions and personal trading preferences.

This approach provides a systematic way to capture trend reversals and manage trades with clear entry and exit signals based on market momentum and volatility.

Example Setup:

• Market: Forex
  
• Pair: USD/GBP
  
• Order size: 100,000 Contracts (1 Lot)
  
• Timeframe: 15 minutes
  
• SMA: 93
  
• ATR Length: 15
  
• Stop-Loss (ATR Multiplier): 7
  
• Take-Profit Multiplier: 2
  

Experiment with different settings to achieve the best results for your trading style and market conditions.