MAPE-Risked Structural Divergence Strategy

Family: hybrid · Regime: trending · Complexity: medium · Asset classes: Forex (Majors) · Timeframes: 30M, 1H, 4H

Thesis

Significant currency moves are driven by global yield/economic divergence reflected in the Strength Matrix; institutional participants leave 'footprints' (Order Blocks) when entering these moves. By filtering for high ADX-momentum and using MAPE to define the price's 'normal' deviation, we can enter these institutional flows at structural inflection points with a statistical safety buffer.

Components

• Currency Strength Matrix (All) (regime) — Filters for currency pairs with high relative divergence, ensuring we only trade the strongest against the weakest.
• DEMA 200 & ADX Combined HUD (direction) — Provides a secondary trend filter and momentum threshold (ADX) to avoid low-volatility ranging markets.
• Order Block & FVG Detector (entry) — Identifies institutional liquidity zones for precise entry triggers within the established trend.
• Momentum Oscillator (exit) — Signals the exhaustion of the price impulse, triggering an exit before a mean-reversion occurs.
• Mean Absolute Percentage Error (MAPE) (risk) — Quantifies the current 'prediction error' of the price relative to its mean (EMA), providing a volatility-adjusted stop-loss distance.

Known failure conditions

• Base and Quote currency strength converge within 10% of each other.
• ADX drops below 15, indicating a total loss of trend momentum.
• MAPE spikes 300% above its 20-period average, suggesting news-driven volatility that invalidates technical structure.

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