EVZ-Sized Accelerating Darvas Breakout

Family: breakout · Regime: trending · Complexity: medium · Asset classes: FX (EUR/USD Focus) · Timeframes: H1, H4

Thesis

Market structural breakouts (Darvas Boxes) are most predictive when accompanied by positive acceleration in momentum (DOsMA) and are sized correctly against external implied volatility expectations (EVZ). The edge exists because price often 'overshoots' during momentum surges that institutional volatility markers haven't yet priced in.

Components

• Type Declaration Coverage Template (regime) — Used to define a strict UDT (User Defined Type) to map market regimes based on price distribution, ensuring syntax compliance with v6 standards.
• Difference of OsMA (DOsMA) (direction) — Acts as a momentum filter to ensure that Darvas breakouts occur during periods of increasing acceleration (second derivative), filtering out 'soft' breakouts.
• Darvas Boxes MetaTrader 5 (entry) — Identifies key structural consolidation zones and provides the primary trigger upon a breakout of the calculated pivot ceiling/floor.
• Chandelier Exit (exit) — Provides a volatility-adjusted trailing stop to lock in profits during the post-breakout trend expansion.
• Euro FX VIX (EVZ) Data Loader (risk) — Dynamically scales position size and initial stop-loss width based on market-implied volatility expectations from the FX VIX.

Known failure conditions

• Prolonged divergence where EVZ remains low but realized price volatility spikes suddenly due to unscheduled news.
• Darvas Boxes repeatedly narrowing to < 10 pips, leading to high-frequency whipsaws.
• DOsMA failing to cross zero during clear trend movements (momentum lag).

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