Elliott-Darvas VIX Pulse Trend

Family: trend_following · Regime: trending · Complexity: high · Asset classes: Equities, Indices, High-Volume Crypto · Timeframes: H1, H4, D1

Thesis

The hypothesis is that sustainable price trends occur when internal market volume (A/D) and ease of price movement (EOM) align with a stable or improving macro-volatility environment (VIX Contango). By using Darvas Boxes to capture breakouts only during Elliott Wave motive phases, the strategy seeks to enter at the point of maximum impulse while using the VIX curve to proactively scale down risk during structural market shifts.

Components

• Elliott Wave [LuxAlgo] (regime) — Establishes the macro cycle; trades are only taken during projected Motive Wave 3 or 5 to capture high-probability impulsive moves.
• Accumulation/Distribution (A/D) Index (direction) — Ensures that price movement is backed by actual volume flow, filtering out 'hollow' breakouts.
• Darvas Boxes Modern/Classic (entry) — Provides the mechanical entry trigger based on price breaking out of established consolidation ranges within the EW cycle.
• Ichimoku Kinko Hyo (exit) — The Kijun-sen (Base Line) acts as a trailing stop and trend exhaustion exit, representing the 26-period equilibrium.
• VIX Curve Regime (Simple) (risk) — Uses the VIX/VIX3M ratio to adjust position sizing and stop-loss elasticity based on broad market fear/stability.
• Ease of Movement (EOM) (confirmation) — Confirms that the breakout is occurring with 'ease' (low resistance), suggesting momentum will persist.
• SMA3x5+BB - pjdhiro (volatility_filter) — Filters for volatility expansion (BB) and ensures trades align with the long-term institutional trend (SMA200).

Known failure conditions

• VIX/VIX3M ratio remains above 1.1 for extended periods (persistent panic), making trend-following unreliable.
• Elliott Wave counts repeatedly 'reset' or oscillate between Wave 1 and 2 without progressing to Wave 3.
• Price remains bound within the Ichimoku Cloud (Kumo) while Darvas Boxes trigger frequent whipsaws.

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).