Wick Imbalance Signals with Fixed Dollar Risk and Reward Targets

Summary

This strategy looks for a wick imbalance in the previous candle, requiring its combined upper and lower wicks to exceed the prior ATR and its real body to meet a minimum ATR-based size. A dominant upper wick produces a long signal, while a dominant lower wick produces a short signal, provided the strategy is flat and the current bar is confirmed. The script then places an entry with a fixed dollar stop-loss and take-profit. It converts those amounts into tick distances using the instrument’s point value, tick size, and default order quantity.

The configured reward is smaller than the risk, so the break-even win rate is displayed alongside the risk-reward ratio and execution metrics. The document explains the intended trade-off but does not provide observed results validating its claims about high win rates or suitability for scalping. Signals depend on a prior candle, and the chart markers are offset for display. Costs and slippage are specified in the strategy settings, but actual performance will depend on market, timeframe, fills, and position sizing.

Key ideas

• The setup compares the previous candle’s wick lengths and filters by ATR-scaled wick and body size.
• An upper-wick-dominant candle maps to a long signal, while a lower-wick-dominant candle maps to a short signal.
• Dollar-based stop and target amounts are translated into tick distances using instrument and quantity information.
• The strategy displays the break-even win rate because its configured reward is smaller than its risk.
• The document provides no tested results to substantiate its proposed win rate or scalping use.

Tags

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