Grid-Cycle Structural Breakout

Family: breakout · Regime: high_vol · Complexity: high · Asset classes: FX, Indices, Commodities · Timeframes: H1, H4

Thesis

Breakout validity is a function of both price expansion and internal consistency. By requiring price to exceed standard deviation 'grid' bands while ensuring the internal bar structure (Advance/Decline Ratio) and cyclical momentum (STC) are aligned, we can filter out noise-driven fakeouts. The edge is derived from the statistical improbability of all four independent dimensions (volatility, trend, cycle, and bar structure) aligning randomly.

Components

• Indicator Sample (Bar Count Logger) (regime) — Ensures the trading environment has sufficient historical data (minimum bar count) to validate the statistical significance of the MA-based filters before execution.
• RSIOMA (RSI of Moving Average) (direction) — Determines the primary trend direction by smoothing price noise through an MA before calculating RSI, reducing false momentum signals.
• Schaff Trend Cycle (STC) (entry) — Provides the final execution trigger by identifying cyclical turning points within a trend, utilizing double-smoothed stochastics to lead lagging indicators.
• Heikin-Ashi Candles (exit) — Filters intraday noise during the trade; a change in HA candle color represents a structural trend shift sufficient for exit.
• Average True Range (ATR) (risk) — Quantifies current market volatility to set dynamic stop-loss distances and normalize position risk.
• Advance/Decline Ratio (Bars) (confirmation) — Confirms the 'quality' of a breakout by ensuring the internal composition of bars (bull vs bear count) supports the price movement.
• Grid Bot [Grid range plugin] Two Moving Avarages [psyll] (volatility_filter) — Acts as a volatility expansion filter; trades are only initiated when price breaks out of the dynamic standard deviation bands.

Known failure conditions

• ADR_B remains near 1.0 during strong price moves, indicating the trend is driven by few large gaps rather than consistent bar pressure.
• STC stays pinned at 0 or 100 for extended periods while price moves against the direction, indicating extreme momentum exhaustion.
• Market enters a low-volatility 'squeeze' where the Grid Bot range is narrower than the ATR-based stop loss.

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