Automating the Darvas Box Breakout and Pyramiding System
Summary
The article translates the Darvas box method into an MQL5 Expert Advisor. It defines a box from a price extreme that holds for three sessions, then requires a breakout above the box boundary with increased volume. The implementation adds filters for low volume during consolidation, minimum box height relative to ATR, and a lookback extreme. It also mirrors the rules for short trades using bear boxes.
A state machine handles box formation, confirmation, breakout monitoring, and trade management. After an initial entry, each higher box breakout can add another position unit; all units share a stop at the newest box floor, which moves upward as the staircase advances. The EA closes the campaign if that stop is breached or if a new box fails to form within a configured interval. The article reports compiling and testing the EA in MetaTrader 5, but offers no performance statistics. Results will depend on the chosen inputs, market, and timeframe; the recommended daily timeframe and currency pairs are suggestions rather than evidence of profitability.
Key ideas
- A box is confirmed when an extreme remains unbroken for three consecutive sessions.
- Breakouts require volume above the box-period average, while box formation is filtered for contracting volume.
- The EA can pyramid by adding a unit on each subsequent box breakout.
- All open units share a stop at the latest box floor, which advances with higher boxes.
- A state machine lets the EA monitor open positions and search for the next box at the same time.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.