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ADX and ATR Breakout Entries with Layered Money Management

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Summary

The strategy uses ADX to identify quieter conditions and ATR to set breakout entry levels. When ADX is below 30, it places a buy stop above the recent high and a sell stop below the recent low, each offset by the 14-period ATR. Its money management is described as similar to Sophia1.1, with settings for trade additions, lot scaling, exits, and trailing stops.

A reported EURUSD hourly backtest covers February to June 2012 and shows 352 trades, net profit of 250.82, profit factor 1.95, and maximum drawdown of 3.29%. Short trades had a higher reported win rate than long trades. These figures describe only the stated historical test: the period is short, the report notes mismatched chart errors, and the results do not establish performance in other markets or conditions.

Key ideas

  • The strategy activates when ADX is below 30.
  • It places stop entries one 14-period ATR beyond the recent high and low.
  • Its money management includes scaling and trailing-stop settings.
  • The reported EURUSD hourly test had 352 trades and a 3.29% maximum drawdown.
  • A short historical backtest with chart mismatches cannot establish broader performance.

Tags

ForexVolatilityBreakoutTechnical indicatorsBacktesting

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.