Balance of Power Threshold Momentum Strategy

Summary

This long-only strategy uses the Balance of Power (BoP) indicator on a stated four-hour timeframe. BoP is calculated from the candle’s close and open relative to its high-low range. A move above 0.8 opens a long position, while a move below -0.8 closes it. Position size scales with account equity and a user-set leverage multiplier, and chart labels and trade boxes mark entries and exits.

The document describes a rule set and publishes a backtest configuration for SOL/USDT on Binance, covering roughly a year of daily bars. It does not report performance statistics, trade counts, or comparative results, so the configuration alone is not evidence of profitability. The text identifies slippage, false signals, poor performance in ranging markets, and leverage as risks. It suggests trend filters, adaptive thresholds, stop losses, and timing filters as possible extensions, but these are proposals rather than tested features. The code also uses a high-low denominator, which can be zero on a flat bar, and the stated timeframe differs from the published daily backtest period.

Key ideas

• BoP measures the candle body relative to its full high-low range.
• A cross above 0.8 opens a long position, and a cross below -0.8 closes it.
• Position size is based on account equity multiplied by a configurable leverage value.
• The stated daily-bar backtest setup does not establish performance on the described four-hour timeframe.
• False signals, slippage, ranging conditions, and leverage can all create losses.

Tags

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