Volume Surge Entries with Blow-Off and ATR Exit Rules
Summary
This strategy seeks long entries in DRO, described by its author as an ASX instrument, when volume rises above its moving average and price closes as a strong bullish candle. It also requires price above a trend EMA, RSI below a ceiling, and no blow-off signal. A blow-off is defined by unusually high relative volume combined with a large upper wick, and it can trigger an immediate close while a position is open.
Risk controls start with a hard stop set at an ATR-based distance below entry. Once the trade reaches a specified gain threshold, a trailing stop based on the highest closing price and ATR becomes active; the tighter of the hard and trailing stops is used. The script supplies configurable inputs and chart displays, but the document provides no backtest results or evidence that the rules are profitable. The described setup is long-only, and its behavior may depend on instrument, timeframe, costs, and parameter choices.
Key ideas
- Entries combine elevated volume, a strong bullish close, an EMA trend check, and an RSI ceiling.
- Extreme relative volume with a large upper wick marks a potential distribution candle and can close a position.
- An ATR-based hard stop is supplemented by a trailing stop after a minimum gain threshold is reached.
- The script presents rules and settings but gives no performance evidence.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.