Seven-Count JD Sequential Reversal Strategy with High-Low Signals

Summary

This short-term strategy adapts a Sequential-style setup by comparing each bar’s high and low with those from two bars earlier. Consecutive higher highs or lower lows build a count capped at seven; a completed count signals a reversal entry against the direction of that count. It uses a five-count reversal or a cross of a level formed at count seven to close positions. The levels are based on a smoothed price measure, and the source also includes options to display early counts and use support/resistance crosses as exits.

The document describes the rules and lists a BTC/USDT futures backtest configuration spanning about one month, but provides no performance statistics or results. It presents the shorter count and high-low comparisons as faster than a conventional nine-count, close-based setup. Risks include frequent false signals in ranging markets, commissions and slippage from frequent trading, and potentially tight stops. The source comments that this is not based on official DeMark documentation, so its naming and interpretation should not be treated as an official formulation.

Key ideas

• The setup increments a count when highs or lows extend beyond those from two bars earlier, up to seven.
• A completed count combined with the latest high-low direction triggers a reversal entry.
• A five-count reversal or a cross of a count-seven support or resistance level can close a position.
• The document suggests short timeframes but warns about false signals, trading costs, and aggressive stops.
• The cited backtest settings describe a sample period and market, but no performance evidence is reported.

Tags

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