T3 Average and Candle Pattern Filters for Short Entries

Summary

This strategy combines a T3 smoothed average with a three-bar bearish candle pattern to time short entries. The T3 line is built from six successive exponential moving averages and weighted coefficients. The described rule requires price to be above the T3 line alongside the pattern condition before entering short. The source also defines a take profit and stop loss in ticks for the intended E-mini S&P 500 futures setup.

The document argues that smoothing and pattern confirmation may reduce noisy entries, while warning that T3 length can make signals either lagged or overly sensitive. It recommends instrument-specific parameter testing and disciplined loss limits. However, the published backtest settings instead specify BTC/USDT futures on a 10-minute period, while the strategy description and code refer to three-minute ES trading. The source enters short when the bearish pattern and price-above-T3 condition coincide; it does not implement a 3-minute interval itself. No backtest results are reported, so claims about performance or suitability for high-frequency use remain unverified.

Key ideas

• The T3 average is calculated from six successive exponential moving averages and weighted coefficients.
• A short entry requires the specified bearish candle pattern and price above the T3 average.
• The source sets a four-tick profit target and a sixteen-tick stop for its stated ES setup.
• The document warns that T3 length trades off lag against noisy signals.
• The described ES three-minute setup conflicts with the published BTC/USDT ten-minute backtest settings.

Tags

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