Tether Line Trend Strategy Using Rolling Highs and Lows

Summary

This trend strategy constructs a reference line as the midpoint between the highest high and lowest low over a configurable lookback. It takes a long position when the close is above the line and a short position when it is below; an input can reverse those directions. The source also colors chart bars according to the indicated position. The document presents the method as suitable for medium- to long-term trend trading and explains the intuition that prices may move around the range midpoint.

The supplied example uses a 50-period lookback by default and reports backtest settings for BTC/USDT futures over roughly a year, using daily strategy bars. No returns, drawdowns, or other test outcomes are reported, so these settings are not evidence of profitability. The strategy description identifies delayed response at reversals, sensitivity to lookback choice, and excess trading or overfitting as risks. It suggests adding stops and filters, but does not evaluate those additions.

Key ideas

• The tether line is the midpoint of the rolling highest high and lowest low.
• A close above the line indicates long exposure, while a close below indicates short exposure.
• A reverse setting swaps the long and short signals.
• The method has no described stop loss and may react late when trends reverse.
• Published backtest settings are provided without performance results.

Tags

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