Trend Balance Point Entries, Stops, and Targets
Summary
The Trend Balance Point (TBP), attributed to J. Welles Wilder, is presented as a momentum-based system for taking long or short positions. It derives separate threshold levels from recent closing-price changes; crossing those levels determines the direction of a position. The accompanying indicator logic also calculates a stop and target from recent daily price data and displays them alongside entry markers.
The source says Wilder considered the method suitable for ranging markets when ADX is below 20. It does not provide performance data or a backtest: the author says they had not tested it and notes that their platform could not enter at the close, as the rules specify. The description therefore offers a system outline and implementation reference, not evidence that the approach is profitable. Its stated market-condition guidance and the calculated exit levels would need independent evaluation before practical use.
Key ideas
- TBP uses recent price momentum to set thresholds for long and short entries.
- The described rules open positions at the current day's close.
- Each entry has a stop level and a target price derived from daily price data.
- The source attributes better suitability to ranging conditions when ADX is below 20.
- The author reports no personal use or backtesting, citing a platform limitation on close-price entry.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.