WAE-UTBot Explosive Momentum Strategy
Family: breakout · Regime: high_vol · Complexity: medium · Asset classes: FX, Equities, Crypto · Timeframes: M15, H1
Thesis
Significant price moves are often preceded by 'volatility explosions' where momentum acceleration outpaces historical volatility. By using the Waddah Attar Explosion to identify these clusters and a zero-lag Triple EMA (McNicholl) to exit at the first sign of momentum decay, the strategy attempts to capture the most efficient portion of a trend while minimizing exposure to the subsequent mean-reversion or consolidation phase.
Components
- Switch Timeframes Keys (regime) — Used to ensure regime alignment across timeframes; the strategy requires momentum confirmation on a higher timeframe (HTF) before execution on the trading timeframe (TTF).
- Waddah Attar Explosion (WAE) (direction) — Filters for 'explosive' price moves where momentum exceeds a volatility-derived threshold (Bollinger Band width), ensuring trades occur during volatility expansion.
- UTBot Alerts (entry) — Provides the specific entry trigger based on ATR-trailing stop crossovers, acting as a sensitive trend-change detector.
- McNicholl EMA (MCNMA) (exit) — Used as a zero-lag sensitive exit to capture the meat of a move and exit before the 'overshoot' or mean-reversion phase.
- Average True Range (ATR) (risk) — Calculates dynamic stop-loss levels and position sizing based on current market noise.
- MACD Demo Implementation (confirmation) — Secondary momentum filter to ensure the fast trend is synchronized with the WAE explosion signal.
Known failure conditions
- The WAE explosion line stays above the trend histogram for >50 bars (low volatility regime).
- Average trade duration falls below 3 bars (hyper-whipsaw).
- Price consistently hits SL but reverses to the target within 1 ATR (incorrect volatility scaling).
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