Darvas-TII Structural Breakout Core

Family: breakout · Regime: trending · Complexity: high · Asset classes: FX, Equities, Crypto · Timeframes: H1, H4

Thesis

Market participants accumulate/distribute in ranges; a breakout of a Darvas box within a volatility-compressed zone (Boxline), confirmed by a dominant Trend Intensity Index (TII) and HTF Ichimoku alignment, identifies a high-probability institutional trend initiation.

Components

• ADX / Connectable [Azullian] (regime) — Filters for trending regimes only; ensures entry occurs when momentum is building (ADX rising) rather than exhausted.
• Trend Intensity Index (TII) (direction) — Provides the directional bias by measuring if price deviations are predominantly positive or negative relative to a 60-period MA.
• Darvas Boxes (Multi-Mode) (entry) — Identifies formal structural breakouts from established price ceilings or floors.
• Risk Reward Indicator Tool (exit) — Standardizes exit logic via a fixed risk-to-reward ratio derived from the fractal stop distance.
• Support and Resistance (Fractal-based) (risk) — Provides objective, structural price levels for stop-loss placement based on 5-bar fractal turns.
• MMT Ichi Workflow Overlay Profiles (confirmation) — Ensures the breakout aligns with broader multi-timeframe Ichimoku cloud structure (Price > Cloud, TK Cross).
• Boxline (Range Breakout) (volatility_filter) — Acts as a volatility contraction filter; requires the market to have been in a defined range before the Darvas breakout.

Known failure conditions

• ADX remains below 20 for extended periods, indicating a permanent shift to low-volatility mean reversion.
• Price repeatedly oscillates through the Darvas Box boundaries without sustaining momentum (whipsaw).
• Ichimoku HTF signals contradict local breakouts, leading to 'death by filters' (zero trade frequency).

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