Currency Basket Momentum & Point-Grid Scalpel

Family: trend_following · Regime: trending · Complexity: medium · Asset classes: Forex (Majors and Minors) · Timeframes: H1, H4

Thesis

Currency trends are driven by underlying capital flows that manifest as aggregate strength across all pairs of a specific currency. By identifying a strong currency relative to its peers and entering pullbacks (CCI) within that momentum (ROC), we capture 'real' trend participation. The 30-point grid provides a hard mechanical limit to losses when the fundamental strength fails to translate into immediate price action.

Components

• Currency Strength Template (regime) — Filters for pairs where the base currency is in a high-momentum state relative to a basket, ensuring we trade the 'strongest' trends.
• Rate of Change (ROC) (direction) — Confirms the specific pair's momentum aligns with the aggregate currency strength.
• Commodity Channel Index (CCI) (entry) — Acts as a timing mechanism to enter during mean-reversion pullbacks within a confirmed trend (from -100).
• Pivot Points (Classic) (exit) — Provides objective, session-based price targets (R1/S1) for profit taking.
• Point-Based Price Grid (risk) — Uses fixed psychological point intervals (e.g., 30 pips) to define hard stop losses and risk units.
• Bollinger Bands (volatility_filter) — Ensures entry occurs when volatility is expanding and price is not at an exhaustive extreme.

Known failure conditions

• Prolonged periods of currency strength convergence (where all currencies move in lockstep).
• High-frequency volatility spikes that trigger the 30-point grid stop before the ROC direction can manifest.
• Structural failure of daily pivot levels to act as magnets or barriers during low-liquidity holidays.

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