Engulfing Candles with Moving Average Direction and Williams Vix Fix Exits

Summary

This strategy enters after a bullish or bearish engulfing-style candle when a selected moving average points in the same direction. The moving average can use several calculation methods and can be evaluated on the chart timeframe or another timeframe. The script also computes the Williams Vix Fix, a volatility measure based on the gap between a recent closing high and the current low, and records its value when entering a position.

Positions close when the Vix Fix value moves below half or above twice its entry reading, or when RSI crosses outside the stated 35–65 band. The author describes the method as needing refinement and invites further testing. Although the source contains configurable Bollinger-style and percentile thresholds, those do not appear to drive the displayed entry conditions. No backtest results or evidence of profitability are provided, and the rules’ performance may depend on market, timeframe, parameter choices, costs, and execution assumptions.

Key ideas

• Long entries require a bullish engulfing-style candle and an upward-sloping selected moving average.
• Short entries require a bearish engulfing-style candle and a downward-sloping selected moving average.
• The strategy records the Williams Vix Fix at entry and exits if it halves or doubles relative to that reading.
• RSI outside the specified 35–65 band also closes all positions.
• The document provides no performance evidence and explicitly characterizes the strategy as needing refinement.

Tags

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