Log-Error Volatility Squeeze Trend-Follower

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

Thesis

Institutional-grade trends are characterized by a 'Volatility Breakout' from a price squeeze, confirmed by volume expansion. By using MSLE to measure the 'unusualness' of price movement (log-deviation), we can filter out noise and size risk based on the stability of the price-to-mean relationship, while Ichimoku provides the precise structural confirmation of a trend transition.

Components

• SuperTrend MT5 (FxGeek) (regime) — Filters trades to ensure entries only occur in the direction of the dominant volatility-adjusted trend.
• MACD Classic (3-Line) (direction) — Ensures that momentum is moving in the direction of the trade at a medium-term horizon before entry.
• Ichimoku Kinko Hyo (entry) — Provides the specific execution trigger via TK-Cross and price position relative to the Kumo cloud.
• MACD (exit) — Captures momentum exhaustion to exit before the trend fully reverses.
• Mean Squared Logarithmic Error (MSLE) (risk) — Quantifies the deviation of price from its log-normal equilibrium to scale risk and set volatility-adjusted stops.
• RVOL (Relative Volume) (confirmation) — Confirms that the breakout is backed by institutional participation rather than low-liquidity noise.
• Bollinger Squeeze Advanced (volatility_filter) — Prevents entry during low-volatility "squeeze" phases and only allows trades when volatility is expanding.

Known failure conditions

• MACD histogram and SuperTrend consistently showing opposing signals for >10 bars.
• RVOL stays below 1.0 during significant price moves, indicating retail-only exhaustion.
• MSLE values stay near zero during high ATR periods, suggesting log-calculation compression issues.

Explore the full interactive blueprint, parameter ranges and evidence on WOBR StrategyVerse, or generate this strategy as an MT4/MT5 Expert Advisor with QuantMogul AI Engine.