Recursive Elliott Impulse Strategy
Family: trend_following · Regime: trending · Complexity: high · Asset classes: FX, Equities, Crypto · Timeframes: H1, H4, D1
Thesis
Market cycles exhibit impulsive phases where momentum becomes self-reinforcing. By identifying these Elliott Wave 'Motive' phases and confirming them with polynomial trend filters (SGF) and recursive averages, we can enter trades with high directional conviction while filtering out the corrective noise that typically triggers false signals in standard trend-following systems.
Components
- Elliott Wave [LuxAlgo] (regime) — Defines the market regime. Filters for Motive Wave 3 or 5 development to ensure we are trading in high-probability impulsive structures rather than corrective noise.
- Savitzky-Golay Filter (SGF) (direction) — Provides the primary trend direction by filtering noise with polynomial regression, ensuring the bias aligns with the underlying cyclical flow.
- Recursive Moving Average Unlimited (entry) — Acts as the execution trigger. The multi-iterative smoothing creates a high-conviction crossover when the price momentum breaks through the recursive density.
- Connect MACD (Azullian) (exit) — Detects momentum exhaustion. Used to exit when the weight-indexed signal line crosses back, capturing the meat of the impulsive wave.
- iExposure (risk) — Used to monitor and manage aggregate risk across the symbol, ensuring lot sizing adheres to the 1% risk rule based on the net exposure calculated.
- Bulls Power (Elder-ray) (confirmation) — Confirms the entry by ensuring buyers are truly exerting strength (Bulls > 0) during a long setup, preventing entries on weak price bounces.
Known failure conditions
- Market enters a prolonged sideways 'Complex Correction' where Elliott Wave pivots fail to confirm a direction.
- Savitzky-Golay slope flattens (near zero) for more than 5 periods, indicating a loss of polynomial trend.
- The Recursive MA creates a 'whipsaw' effect during low-volatility compression.
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