Regime-Performance Hidden Divergence Trend-Follower

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

Thesis

Assets exhibiting multi-timeframe relative strength are likely to persist in their current trend. By waiting for hidden divergences (momentum pullbacks) and confirming price expansion beyond local volatility channels, we can enter these trends with a high probability of continuation while using spread-based filters to maintain economic viability.

Components

• Performance Table (regime) — Identifies assets with persistent relative strength/weakness across multiple horizons to ensure we are trading in the direction of institutional flow.
• Multi-Type Moving Average Sticker (direction) — Uses a 17-period Linear Weighted Moving Average (LWMA) to provide a responsive trend filter, ensuring entries align with immediate price inertia.
• Divergence Base Template (entry) — Detects hidden divergences which typically signal trend continuation after a minor pullback, providing high-probability entry points within an established trend.
• HiLo Activator (Pandini Version) (exit) — Serves as a trailing exit mechanism that tightens as the trend progresses, protecting gains and exiting when the immediate trend structure breaks.
• Spread Display and Alert (risk) — Acts as a trade execution gatekeeper; if the spread exceeds the threshold, the entry is invalidated to prevent high slippage/cost from eroding the edge.
• Linefill All Visualizer (volatility_filter) — Used to define a 'no-trade' volatility zone; entries only occur if price has expanded beyond the visualized channel created by recent High/Low linefills.

Known failure conditions

• The Performance Table shows conflicting signals across timeframes (e.g., 1M positive but YTD negative), indicating a loss of regime coherence.
• Price remains trapped within the Linefill Visualizer channel for extended periods, suggesting a low-volatility environment where divergence signals are prone to failure.
• Spread frequently exceeds the Alert threshold during signal windows, making the strategy economically unviable.

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.