Trend Pullback Entries with Engulfing Zones and Scale-In Positioning
Summary
This strategy filters direction with a 200-period exponential moving average and identifies recent pivot structure. After a bullish engulfing candle near a recent pivot low in an uptrend, it marks the candle body as a mitigation zone; the bearish setup mirrors this near a pivot high below the average. A later touch of an active zone can trigger an initial position or an additional entry, subject to the position already being in the indicated trend direction.
Scale-in orders grow across as many as five entries, with later orders assigned larger equity fractions, and additions are made only when price is adverse relative to the average entry. The basket exit is a fixed percentage above or below the strategy's average position price. The document gives the rules and code and mentions testing by the author, but provides no performance statistics, sample period, or market-specific results. It also specifies no stop-loss, so exposure can accumulate during continued adverse movement; pivot confirmation and zone lifetime settings affect signal timing and frequency.
Key ideas
- A 200-period EMA determines the permitted trend direction for long and short setups.
- Engulfing candles near recently confirmed pivots define zones that can be used for later pullback entries.
- A zone touch can trigger an initial position or an adverse-price scale-in, with at most five open entries.
- Scale-in order fractions increase for later entries, while the basket target is tied to average position price.
- The strategy specifies no stop-loss and provides no quantified backtest evidence.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.