SuperTrend and Stochastic Entries with ATR Stops

Summary

This strategy combines a SuperTrend direction filter, a 200-period EMA option, and a smoothed Stochastic oscillator. Long signals require an uptrend and a low Stochastic reading, alongside price above the EMA when that filter is enabled. Short signals use a downtrend and a high Stochastic reading, with price below the EMA when enabled. The listed defaults include a 10-period ATR with factor 3, a 200-period EMA, and Stochastic lengths of 14 with smoothing values of 3.

The source also calculates ATR-based stop levels and sets take-profit levels at twice the initial stop distance. After price reaches a one-to-one favorable move relative to that distance, the stop shifts to entry price. Only one position may be open at a time. No market, backtest period, or performance results are provided. The brief prose describes the opposite SuperTrend and price conditions for buys and sells from those implemented in the source, so the code rules and prose should not be treated as interchangeable. Results would depend on execution assumptions and parameter choices.

Key ideas

• SuperTrend direction and Stochastic extremes jointly define entry signals.
• The optional EMA filter requires price to align with the trade direction.
• ATR-based stops are paired with profit targets set at twice the initial stop distance.
• The stop moves to entry price after a favorable move equal to the initial risk distance.
• The prose conflicts with the source on entry conditions, and no performance evidence is supplied.

Tags

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