Four-Hour Range Reversal Strategy with a Five-Minute Confirmation

Summary

The strategy defines a range using the high and low of the first four-hour candle of the New York day. Once that candle has formed, it waits for a five-minute close outside the range, followed by a close back inside. A move above the high and then back into the range triggers a sell signal; a move below the low and then back inside triggers a buy signal. To avoid entries after an extended move, it invalidates a setup if price remains outside the range for more than 75 minutes.

The author says EURUSD backtests under their conditions were unprofitable, though the document supplies no detailed results or testing parameters. It also flags broker server time and daylight-saving transitions as critical: an offset error can shift the range and invalidate the intended session. The strategy omits an unspecified order-block rule, and its time filter is a substitute for that missing detail. The stated logic alone does not establish robustness across brokers, periods, or instruments.

Key ideas

• The first four-hour candle in New York time sets the day's high-low range.
• A five-minute close outside the range followed by a close back inside produces a reversal signal.
• An outside move lasting more than 75 minutes invalidates the setup.
• Broker GMT offsets and seasonal clock changes must be configured accurately.
• The author reports unprofitable EURUSD backtests under their conditions, without detailed test evidence.

Tags

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