Fractal Memory Breakout System

Family: breakout · Regime: trending · Complexity: medium · Asset classes: Equities, Forex, Crypto · Timeframes: 4H, 1D

Thesis

Market breakouts are only valid when they coincide with an expansion of market 'memory' (represented by map-history size) and momentum confirmation. By filtering fractal breaks through a UDT-verified data structure and MACD, we eliminate low-conviction price spikes that lack structural backing. This edge exists because markets tend to trend only after breaking significant structural levels (fractals) with increasing volatility (Chandelier) and velocity (MACD).

Components

• UDT Array Push Identity Test (regime) — Used as a 'Structural Integrity' filter; ensures that the current price point (UDT) aligns with the historical array of market points before allowing entries.
• Supported map history (direction) — Uses the historical referencing of Map objects to calculate a 'Memory-Adjusted Price Level' (y) to confirm the trend direction.
• Trend Break Fractal (entry) — Acts as the primary execution trigger when price breaches the resistance or support formed by two consecutive fractals.
• Ichimoku Kinko Hyo (exit) — Used for secondary trend-following exits and dynamic support/resistance identification.
• Chandelier Exit (risk) — Provides the primary volatility-based trailing stop and risk management parameter.
• MACD Classic (3-Line) (confirmation) — Provides momentum confirmation to ensure the fractal break has sufficient volume and velocity.

Known failure conditions

• Price stays within the Ichimoku Kumo (Cloud) for extended periods, indicating a lack of trend.
• The distance between the 2nd Fractal and the Chandelier Exit exceeds 5% of asset value, indicating excessive risk.
• MACD histogram stays flat despite fractal breaks, suggesting low-liquidity manipulation.

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