Volume-Confirmed Channel Breakouts with ChoCH and BOS Signals

Summary

This strategy combines price breaks of the previous candle’s range with high-volume candle signals. It calculates average volume over a lookback period and labels bearish and bullish candles as vector candles when volume exceeds a multiple of that average. A close below the prior low with a bearish vector candle marks a ChoCH signal; a close above the prior high with a bullish vector candle marks a BOS signal. The stated trade logic enters long after bearish confirmation and closes that position after bullish confirmation.

The published settings use a volume lookback of 10, a volume multiplier of 2, and three confirmation candles, while the code confirms when at least two qualifying candles appear in that window. Backtest settings identify BTC-USDT futures over a short historical period, but no performance statistics are supplied. The code’s confirmation conditions count vector candles independently of the prior-range break, so the described confirmation can occur without a fresh breakout. It has no stated stop-loss and may produce false signals in choppy markets.

Key ideas

• Vector candles are defined by comparing candle volume with a multiple of average volume.
• A close beyond the previous candle’s high or low combines with candle direction and volume to identify BOS or ChoCH signals.
• The strategy enters long after bearish vector candle confirmation and closes the position after bullish confirmation.
• The stated confirmation window uses three candles and requires at least two qualifying vector candles in the code.
• The document identifies choppy-market false signals and the absence of a stop-loss as risks.

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