Hybrid Darvas-UTBot Structural Trend Follower

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

Thesis

Institutional participation in a trend is often marked by volume spikes coinciding with moving average alignment. By using a volatility-based entry (UTBot) that triggers only when price breaks its current ATR 'noise' band, we capture high-momentum legs. Using Darvas Boxes for risk management ensures that stops are placed at structural levels where the trend hypothesis is truly invalidated, while ZigZag exits allow the trend to run until a confirmed reversal in market structure occurs.

Components

• Simple Moving Average (SimpleMA) (regime) — Establishes the primary trend regime to ensure entries are only taken in the direction of the long-term arithmetic mean.
• Custom 006 Hybrid Table Scanner (direction) — Filters for high-conviction direction by requiring dual EMA alignment and volume confirmation of institutional activity.
• UTBot Alerts (entry) — Provides volatility-adjusted entry triggers based on ATR trailing stop crossovers, minimizing entries during low-momentum periods.
• ZigZag Color (Classic) (exit) — Acts as a trend-exhaustion filter; exits positions when a new structural swing leg in the opposite direction is confirmed.
• Darvas Boxes Modern/Classic (risk) — Defines the structural 'floor' or 'ceiling' for the current price action to set hard stops and calculate position risk.

Known failure conditions

• Consecutive ZigZag exit signals occurring within 3 bars of entry (indicating range-bound noise).
• Darvas Box heights exceeding 10% of the asset price (volatility too high for meaningful structural risk).
• UTBot signals firing against the slope of the 50 SMA.

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