Ehlers-Williams Ultimate Momentum Filter

Family: trend_following · Regime: trending · Complexity: high · Asset classes: FX, Equities, Crypto · Timeframes: 30m, 1h, 4h

Thesis

This strategy hypothesizes that market trends are most exploitable when structural price-action breaks (Three-Line Break) align with low-lag digital signal filters (USF) and multi-timeframe momentum (ADX/DEMA). By entering only when the 'Alligator' regime confirms an active trend and 'Bears Power' confirms momentum dominance, the strategy filters out false breakouts. The edge is generated by capturing the acceleration phase of a trend while using structural fractals for objective risk definition and PSAR for non-linear profit trailing.

Components

• Bill Williams Alligator (regime) — Defines the macro trend environment; trades are only taken when the 'mouth' is open, filtering out sideways noise.
• Ehlers Ultimate Smoother Filter (USF) (direction) — Provides a zero-lag directional bias, ensuring the immediate price move aligns with the larger regime.
• DEMA 200 & ADX Combined HUD (entry) — Acts as the primary trigger; ensures entries occur only when momentum (ADX) and long-term trend (DEMA) are synchronized.
• Parabolic SAR (Standard) (exit) — Provides a dynamic, non-linear trailing stop that tightens as momentum accelerates.
• Support and Resistance (Fractal-based) (risk) — Uses structural pivots to determine initial stop-loss placement and calculate risk-adjusted position sizing.
• Bears Power (confirmation) — Confirms that even the weakest participants (bears in an uptrend) are losing ground, or vice-versa.
• Three-Line Break (TLB) with MA (volatility_filter) — Filters out minor volatility fluctuations by requiring a significant price structural break before a signal is valid.

Known failure conditions

• Prolonged 'sleeping' alligator (intertwined SMMA) leading to no signals in trending markets.
• ADX staying below 20 for extended periods during 'slow bleed' trends.
• Frequent stop-outs by PSAR in low-volatility 'grinding' trends.

Explore the full interactive blueprint, parameter ranges and evidence on WOBR StrategyVerse, or generate this strategy as an MT4/MT5 Expert Advisor with QuantMogul AI Engine.