HiLo Momentum Structural Trigger Strategy

Family: trend_following · Regime: trending · Complexity: medium · Asset classes: Forex, Equities, Indices · Timeframes: H1, H4, D1

Thesis

The strategy assumes that significant market moves are preceded by a alignment of macro-trend regime and momentum, where candlestick patterns act as the final confirmation of participant aggression. By using a zero-lag exit (ZLSMA), the hypothesis is that we can capture a larger portion of the 'meat' of the trend than standard trailing stops, while the HiLo and MACD filters reduce the frequency of false candlestick signals.

Components

• HiLo Activator 02 (regime) — Establishes the macro-trend regime and structural support/resistance 'staircase' levels.
• MACD Demo Implementation (direction) — Provides momentum confirmation to ensure the candlestick pattern is occurring in the direction of active flow.
• Pattern Recognition Master (entry) — Acts as the precise trigger by identifying micro-rejections or momentum shifts via Japanese candlestick geometry.
• Zero Lag Least Squares Moving Average (ZLSMA) (exit) — Provides a sensitive, low-lag trailing exit to capture trend extensions while minimizing give-back during reversals.
• Average True Range (NNFX Version) (risk) — Determines dynamic stop-loss distance and position sizing based on current market volatility.

Known failure conditions

• The strategy produces consecutive losses in trending environments due to 'Pattern Recognition Master' identifying false reversals.
• Asset classes with high fixed spreads (e.g., Exotic FX) negate the edge provided by the ZLSMA exit.
• ZLSMA frequently overshoots price in low-volatility environments, causing exits at breakeven or loss despite favorable movement.

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