Fourier-Ichimoku Structural Cycle System

Family: trend_following · Regime: trending · Complexity: high · Asset classes: FX, Equities, Crypto · Timeframes: H1, H4, D1

Thesis

Market trends are most tradable when a structural regime change (Ichimoku) is confirmed by cyclical energy (Fourier) and smoothed momentum (RSIOMA). The edge lies in the exclusion of 'exhausted' trends via MSLE (logarithmic error) and using structural pivots (Elliott Wave) to define the point of invalidation rather than arbitrary price levels.

Components

• Ichimoku Kinko Hyo (regime) — Provides the macro trend filter (Kumo cloud) and mid-term equilibrium (Kijun-sen) to ensure trades align with the dominant regime.
• Average Force (direction) — Acts as a momentum filter to ensure that the price action relative to its lookback range is positive/negative before entry.
• Ehlers Fourier Series Indicator (FSI) (entry) — Detects the phase of the dominant market cycle; entry is triggered when the cyclical component turns in the direction of the trend.
• SSL Channel (exit) — Provides a trailing exit mechanism based on high/low price channels, capturing the meat of the trend while exiting on momentum flips.
• Elliott Wave [LuxAlgo] (risk) — Identifies market structure pivots (Waves 2 or 4) to set logical, structure-based stop losses rather than arbitrary pips.
• RSIOMA (RSI of Moving Average) (confirmation) — Filters out noise by calculating RSI on a moving average, confirming trend quality and strength.
• Mean Squared Logarithmic Error (MSLE) (volatility_filter) — Prevents entry during periods of parabolic volatility (blow-off tops) or extreme stagnation where the log error exceeds historic norms.

Known failure conditions

• Market enters a protracted 'choppy' sideways range where Ichimoku Kumo is thin and frequently pierced.
• A fundamental 'black swan' event invalidates Elliott Wave structures, causing pivots to repaint or fail instantly.
• Failure of the 20-period fundamental cycle to manifest, rendering the Fourier Series signals as noise.

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