Combining Supertrend Direction with Bar-Reversal Signals

Summary

This strategy combines Supertrend, which derives a trend direction from ATR and a factor, with a bar-direction signal based on the current candle relative to its open and the previous close. The stated entry logic requires both indicators to agree: long in an uptrend with a bullish bar signal, and short in a downtrend with a bearish signal. It aims to close or reverse exposure when the Supertrend direction changes. The supplied parameters are an ATR length of 10 and a factor of 3.

The document provides BTC/USDT futures backtest settings for December 2023 but no performance results. Its prose and source are not fully consistent: the overview says either indicator can trigger a trade, while the entry rules require agreement; the source also contains additional reversal entries that complicate the stated exit behavior. No explicit stop-loss distance or validation evidence is provided. The document identifies parameter sensitivity and short-term reversals as risks and suggests testing added stop rules, volume filters, and other confirmation signals.

Key ideas

• Supertrend uses ATR and a factor to indicate trend direction, while the bar signal captures short-term candle movement.
• The described primary entries require trend and bar direction to agree.
• The supplied defaults are an ATR length of 10 and a factor of 3.
• The source includes additional reversal entries, making its behavior more complex than the prose description.
• The provided backtest interval has no reported performance results.

Tags

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