Fisher-Schaff Cyclical Trend Follower

Family: hybrid · Regime: trending · Complexity: medium · Asset classes: FX, Equities, Commodities · Timeframes: H1, H4, D1

Thesis

Trends move in cyclical waves rather than linear paths. By using the Fisher Transform to normalize momentum and the STC to identify cyclical 'reloads' within a SuperTrend-defined regime, we can enter during the acceleration phase of a minor wave within a major trend, using ATR-based stops to protect against volatility clusters.

Components

• SuperTrend MT5 (FxGeek) (regime) — Defines the primary trend regime to ensure entries align with volatility-adjusted momentum.
• Fisher Transform (EarnForex) (direction) — Normalizes price distribution to identify potential momentum shifts early in the cycle.
• Schaff Trend Cycle (STC) (entry) — Identifies cyclical exhaustion and reversals within the larger trend for precise timing.
• TopTrend (BBands Stop) (exit) — Provides a volatility-based dynamic trailing exit to capture trend extension while locking profits.
• Chandelier Exit (risk) — Used for initial hard stop-loss and position sizing based on ATR-driven volatility.
• Absolute Strength Histogram (ASH) (confirmation) — Filters signals by ensuring the dominant force (bulls/bears) has a clear mathematical advantage.

Known failure conditions

• Strategy underperforms a simple Buy & Hold or trend-following benchmark during sustained low-volatility expansion.
• Failure of ASH to filter churn results in >5 consecutive losses in a tight range.
• Fisher Transform 'Value' pinning at extremes for extended periods without price follow-through.

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