Momentum Pullback Strategy

This strategy is designed to capitalize on trend-following opportunities by using a combination of Exponential Moving Averages (EMAs) and the Average Directional Index (ADX). The strategy identifies potential entry points during strong trending conditions when the price interacts with key EMA levels.

How It Works

• EMA Structure: The strategy uses three EMAs (25, 100, and 200) to determine the overall trend direction. Long trades are favored when the EMAs are aligned in a bullish structure (EMA25 > EMA100 > EMA200) and short trades are favored in a bearish structure (EMA25 < EMA100 < EMA200).
• Entry Points: The strategy looks for pullbacks to the EMA25 within the context of the overall trend. Long trades are triggered when the price dips below the EMA25 and then recovers, while short trades are triggered when the price spikes above the EMA25 and then drops back below.
• ADX Filter (Optional): To ensure trades are only taken in strong trending conditions, an ADX filter can be applied. The strategy will only enter trades when the ADX is above a user-defined threshold, indicating a strong trend.
• Risk Management: The strategy uses a user-defined stop loss and take profit, calculated as a percentage of the entry price, to manage risk and reward.

Key Features

• Trend-Following Logic: This strategy aims to enter trades in the direction of the prevailing trend, as identified by the EMA structure.
• Precision Entries: By focusing on pullbacks to the EMA25, the strategy seeks to enter trades at advantageous levels within a trend.
• Customizable Filters: The optional ADX filter allows traders to focus on high-probability trades in strong trends.
• Risk Management: With adjustable stop loss and take profit levels, traders can fine-tune the strategy to fit their risk tolerance and market conditions.