Pitchfork Flip-Flop Structuralist Strategy

Family: hybrid · Regime: trending · Complexity: medium · Asset classes: FX, Indices, Commodities · Timeframes: H1, H4, D1

Thesis

The hypothesis is that markets move in structured channels (Pitchforks) but only reverse or continue at key levels of historical imbalance (Supply/Demand). By waiting for a momentum 'flip' (FFI) at these zones, we filter out premature entries. We further hypothesize that the 'predictability' of these moves is inversely proportional to the Relative Absolute Error (RAE), meaning we should reduce exposure when price deviates erratically from its mean structure.

Components

• Auto Pitchfork (regime) — Defines the primary trend vector and channel boundaries. Only trades in the direction of the pitchfork slope are permitted to ensure alignment with large-scale structure.
• Supply & Demand Zones (NNFX) (direction) — Identifies high-probability reversal areas. Entries are only valid if price is interacting with a Demand (Long) or Supply (Short) zone.
• Flip Flop Indicator (entry) — Acts as the momentum trigger. It requires price to breach the high of the most recent 'extreme' bearish candle (for longs), confirming that sellers have lost control at the zone.
• MACD (exit) — Used to detect momentum exhaustion. A signal line cross against the trade direction indicates the mean-reversion move has reached its peak.
• Relative Absolute Error (RAE) (risk) — Measures the 'predictability' of price. Higher RAE values suggest high error relative to the mean, necessitating wider stops and reduced position sizing due to increased noise.

Known failure conditions

• Pitchfork slope frequently flipping directions (choppy/sideways regime) despite large depth.
• Price consistently blowing through Supply/Demand zones without reaction, indicating a high-velocity trend regime.
• RAE remaining above 1.5 for extended periods, suggesting the market is in a state of 'chaotic' movement where mean-based structure fails.

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