Centered Envelope Momentum Reversal (CEMR)

Family: mean_reversion · Regime: ranging · Complexity: high · Asset classes: FX, Indices, Large-cap Equities · Timeframes: H1, H4

Thesis

The strategy operates on the hypothesis that price extremes relative to a Centered Triangular Moving Average (TMA) represent temporary inefficiencies. Because TMA CG incorporates future price points to find a 'perfect' center, its signals in live trading anticipate a return to this equilibrium. By filtering these extremes with QQE momentum and protecting the trade with a TopTrend volatility stop, the trader can exploit these mean-reversion cycles while limiting downside during unexpected trend breakouts.

Components

• TMA CG 2024 (Centered Moving Average) (regime) — Defines the 'true' price channel; trades are only initiated when price deviates significantly (1.618 SD) from this smoothed center.
• Supported plot Input Show Last (direction) — Serves as a temporal filter to ensure entry signals are only processed within the most recent candles, preventing late entries on stale regime shifts.
• Qualitative Quantitative Estimation (QQE) with Alerts (entry) — Provides the specific entry trigger via the crossing of the smoothed RSI (Fast TL) and the volatility-based trailing level (Slow TL).
• Bollinger Bands (Standard) (exit) — Used as a dynamic take-profit target; price reaching the opposite band indicates mean reversion completion.
• TopTrend (BBands Stop) (risk) — Functions as the hard stop-loss and trailing stop, providing a volatility-adjusted floor/ceiling.

Known failure conditions

• Price sustains a 'band-walk' on the outer TMA for more than 20 bars without a QQE cross.
• TopTrend flip-flops more than 3 times in a 10-bar window (choppy market).
• Real-time price action consistently invalidates historical TMA signals (repaint delta too high).

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