Adaptive Volume-Momentum Trend Follower

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

Thesis

Sustainable price trends are driven by volume-backed momentum. By entering when Momentum and A/D align during a non-exhausted RSI regime (50-70 for longs), and exiting using an Efficiency-Ratio based adaptive moving average (KAMA), the strategy captures high-probability trend segments while avoiding the 'tail' of the trend where volatility often spikes without directional progress.

Components

• Relative Strength Index (Standard) (regime) — Used as a regime filter to ensure the strategy only enters trades when momentum is active but not overextended (avoiding extremes).
• Momentum (direction) — Provides the primary directional bias; the zero-line cross ensures we are trading in the direction of the medium-term price shift.
• UTBot Alerts (entry) — Acts as the tactical entry trigger by identifying local volatility breakouts above an ATR-based trailing stop.
• MultiKAMA (TyphooN) (exit) — Serves as the trend exhaustion exit; its adaptive nature flattens during noise and tightens during strong trends.
• Chandelier Exit Heiken Ashi Variant (risk) — Defines the hard stop-loss and position sizing based on Heiken Ashi smoothed volatility.
• Accumulation/Distribution (A/D) (confirmation) — Confirms that price movement is supported by volume flow, filtering out 'hollow' breakouts.

Known failure conditions

• Price remains in a tight range resulting in the MultiKAMA and UTBot lines overlapping frequently.
• Low volume environments where the A/D indicator becomes erratic and loses its predictive power.
• Significant overnight gaps that bypass the Chandelier HA stop levels.

Explore the full interactive blueprint with parameter ranges and evidence on WOBR StrategyVerse, or generate this strategy as an MT4/MT5 Expert Advisor with QuantMogul AI Engine (free download).