EVZ-Filtered Cyclical Order Flow Strategy

Family: hybrid · Regime: trending · Complexity: high · Asset classes: Forex (specifically EUR/USD) · Timeframes: M15, H1, D1

Thesis

EUR/USD price discovery is driven by institutional liquidity imbalances (Order Blocks). By using the Euro VIX (EVZ) as a volatility proxy, we can dynamically adjust risk and targets to the market's expected 30-day range. The edge exists by entering during periods of cyclical alignment (BPF) when multi-timeframe momentum (Heatmap) confirms institutional flow, filtering out low-conviction moves using candle-size deltas.

Components

• Bandpass Filter (BPF) (regime) — Used to identify cyclical regime alignment. Entry is only permitted when price momentum is oscillating within the target frequency band, avoiding exhausted trends.
• MTF Heatmap Template (direction) — Ensures multi-timeframe trend alignment (H1/D1) to filter out counter-trend scalp opportunities.
• Sonarlab - Order Blocks (entry) — Provides the specific entry trigger when price returns to a high-momentum supply/demand zone.
• Equity Line Projection (exit) — Used as a hard-target exit utility to visualize and execute take-profit levels based on account-level equity goals.
• Euro FX VIX (EVZ) Data Loader (risk) — Determines position sizing and stop-loss distance based on implied market expectations of 30-day volatility.
• Size Highs and Lows 2 (volatility_filter) — Acts as a local volatility filter to ensure recent candle body size (realized volatility) is sufficient to justify an entry.

Known failure conditions

• Protracted periods of EVZ compression (below 6.0) where volatility is insufficient to reach projected equity targets.
• Breakdown of the 15-30 bar cycle frequency, rendering the BPF signals irrelevant.
• Large gap openings that bypass the projected equity exit line on the chart.

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