SuperTrend Entries with ATR-Based Stops and Profit Targets
Summary
This strategy uses a SuperTrend direction change to enter long or short positions, then sets a stop-loss and profit target using ATR multiples. On a bullish signal, it closes any short position and opens a long; on a bearish signal, it closes any long and opens a short. The published settings specify a 10-period ATR, a SuperTrend factor of 3, a stop multiplier of 1, and a profit multiplier of 2. Exit levels are calculated from the close and ATR when the entry signal occurs.
The document explains that volatility-based distances can widen or narrow with market conditions, while also warning that SuperTrend may reverse repeatedly in sideways markets and that ATR multipliers can be too tight or too wide. It proposes filters, dynamic sizing, time restrictions, and higher-timeframe confirmation as possible refinements. These suggestions are not evaluated.
Backtest settings identify ETH/USDT futures on two-minute bars over several days in April 2025. No trade statistics or performance evidence are provided, and the short test interval cannot demonstrate robustness across market regimes.
Key ideas
- A change in SuperTrend direction, together with price on the corresponding side of its line, triggers a long or short entry.
- A new signal closes the opposite position before opening the new direction.
- The strategy places stop and profit orders at ATR-based distances calculated when the signal occurs.
- The example uses a 10-period ATR, a factor of 3, a stop multiplier of 1, and a profit multiplier of 2.
- Sideways-market reversals and poorly chosen ATR multipliers can cause losses; the brief published backtest settings include no performance results.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.