Bias-Filtered Fractal Gap Reversal

Family: breakout · Regime: trending · Complexity: medium · Asset classes: Forex, Crypto, Indices · Timeframes: 15m, 1h, 4h

Thesis

Market structure breaks (Fractals) that generate significant directional bias (Mean Error) often create aggressive price imbalances (FVG) as liquidity is purged. An edge exists in waiting for the re-balancing of these gaps after a confirmed structural shift, using session volatility projections (ATR Fib) to define the boundaries of the move's invalidation.

Components

• Mean Error (ME) (regime) — Filters for directional persistence by ensuring the 'Predicted' price (SMA) is significantly disconnected from 'Actual' price, indicating a momentum-heavy regime.
• Trend Break Fractal (direction) — Identifies the macro structural shift when a price breaks a localized pivot cluster.
• Fair Value Gap (FVG) Indicator (entry) — Seeks entry within localized liquidity imbalances immediately following the trend break.
• UTBot Alerts (exit) — Provides a dynamic ATR-based trailing exit to capture extended trend runs while mitigating whipsaw.
• ATR Fib (risk) — Uses the session-based ATR projection levels to define hard stop-loss coordinates and risk-unit calculation.

Known failure conditions

• Asset median ATR falls below the static 'ATR' input in the ATR Fib indicator for >10 days.
• Price consistently fills the FVG but fails to expand in the direction of the Fractal Trend Break (liquidity grab regime).
• Mean Error remains near zero for extended periods while price is volatile, indicating erratic oscillation rather than trend.

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