Carter-Float Pullback Inversion

Family: hybrid · Regime: trending · Complexity: medium · Asset classes: Equities, Forex (High Liquidity), XAU/USD · Timeframes: H1, H4

Thesis

The strategy bets that the first significant momentum divergence (ADX inversion) after a TTM Squeeze release in a trending market is a false reversal (shakeout) rather than a trend change, provided volume turnover (Float) confirms sufficient market participation. Entry occurs on the pullback to capture the second leg of expansion.

Components

• TTM Squeeze (Carter Ratio version) (regime) — Defines the market state as either 'coiling' (Squeeze On) or 'expanding' (Squeeze Off). High-momentum expansion is required for entry.
• Simple Moving Average (SMA) (direction) — Filters trades to ensure entries align with the long-term institutional trend direction.
• ADX Crossing INGM (entry) — Used here as a 'pullback exhaustion' trigger. Given the indicator's internal logical inversion, a +DI crossing below -DI during an uptrend signals a temporary bearish surge that may be ripe for mean reversion.
• Restu Kaioh Scalping Indicator (exit) — Uses stochastic overextension to exit positions before momentum fully dissipates.
• Median Absolute Error (risk) — Provides a volatility-adjusted stop-loss based on the median forecast error of the current price action, resisting outlier-induced stops.
• Float Indicator (volatility_filter) — Acts as a volume-based hurdle; entries only occur once a significant portion of the 'float' has turned over, suggesting trend maturity.

Known failure conditions

• Prolonged low-volatility 'Squeeze On' states leading to time-decay in options or stagnant capital.
• Price oscillating around the SMA 200, creating whipsaws.
• Low volume environments where the Float turnover threshold is never met.

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).