Fair Value Gap Trading with Trend Filters and Risk Controls

Summary

This product description outlines an automated strategy that identifies bullish and bearish three-bar fair value gaps and enters when price retraces into an unfilled zone. It tracks each gap separately so a traded setup is not reused. To filter signals, it can compare higher-timeframe EMA50 and EMA200 bias, ADX trend strength, and directional indicators; users can require both filter types, either condition, or no regime filter.

Stops and targets can use ATR multiples or fixed point distances, while sizing can use a fixed lot or account-risk percentage. Trade management includes partial exits, trailing stops, and a cap on concurrent positions. Daily and total drawdown limits and session-hour restrictions are also described. The document offers feature claims rather than backtest results or evidence of profitability, and does not specify instruments, parameter validation, or execution assumptions. Its value is as a concise outline of a rules-based trading system and its risk-management options.

Key ideas

• The EA detects three-bar bullish and bearish gaps and enters on a pullback into an unfilled zone.
• EMA and ADX conditions can screen for directional regimes and trend strength.
• Stops and targets support volatility-adjusted ATR distances or fixed point distances.
• Position sizing can be fixed or based on a chosen share of account risk.
• Partial exits, trailing stops, trade caps, and drawdown limits are available, but no performance evidence is provided.

Tags

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