Four-Hour Range Reversal Strategy with Five-Minute Confirmation

Summary

This EURUSD setup defines a range from the first four-hour candle of the New York day, then watches five-minute closes for a move outside that range followed by a close back inside. A return inside after an upside break produces a sell signal; a return inside after a downside break produces a buy signal. The logic treats failed range breaks as reversal opportunities.

The document adds a time filter: if price remains beyond a range boundary for more than 75 minutes, a later trade is invalidated, intended to avoid entries after an extended move. It also emphasizes configuring broker time offsets and seasonal clock changes correctly because the range depends on New York local time. The author states that backtests on EURUSD under their conditions were unprofitable. No detailed results, sample period, risk rules, or execution assumptions are provided, so the setup’s performance and robustness cannot be assessed from the text.

Key ideas

• The setup uses the first New York four-hour candle to define the day’s high-low range.
• A five-minute close outside the range followed by a close inside signals a possible reversal.
• Trades are invalidated when price stays beyond a range boundary for over 75 minutes.
• Broker offset and daylight-saving settings affect the range’s timing and must be configured accurately.
• The author reports unprofitable EURUSD backtests under their conditions, without supplying detailed test evidence.

Tags

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