Gator Gap Momentum Strategy

Family: breakout · Regime: trending · Complexity: medium · Asset classes: Forex, Equities, Indices · Timeframes: H1

Thesis

The 'Gap Expansion' hypothesis posits that price gaps occurring during the 'Eating' phase of the Gator Oscillator represent the most aggressive phase of a trend breakout. By filtering these gaps with Volume Force and multi-timeframe alignment, we isolate 'true' breakouts from 'exhaustion' gaps or low-volume slippage. The MAPE filter adds a layer of safety by ensuring the breakout occurs from a relatively stable base rather than an already overstretched parabolic move.

Components

• Gator Oscillator (regime) — Identifies the 'Eating' phase where price is actively trending and volatility is expanding, filtering out 'Sleeping' (range-bound) regimes.
• ProfitRobots Dashboard Template (direction) — Provides a structural multi-timeframe directional bias to ensure trades align with the dominant higher-period trend.
• MindTheGap (entry) — Acts as the tactical trigger; a gap in the direction of the trend signals a sudden imbalance in order flow.
• Commodity Channel Index (CCI) (exit) — Captures momentum exhaustion or mean reversion signals to exit before the trend fully reverses.
• Average True Range (ATR) (risk) — Provides dynamic stop-loss levels and determines position size based on current market volatility.
• Volume Force (VF) (confirmation) — Confirms that the price gap is supported by active volume-weighted momentum rather than low-liquidity slippage.
• Mean Absolute Percentage Error (MAPE) (volatility_filter) — Filters out entries when the price is excessively deviated (MAPE > Threshold) from its model, preventing buying at local exhaustion points.

Known failure conditions

• Strategy enters a 'whipsaw' period where Gator oscillates between green and red bars every 2-3 candles.
• Price gaps are consistently 'filled' immediately against the trend, suggesting a lack of follow-through.
• High correlation across multiple pairs leads to simultaneous stop-outs during news events.

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