Recursive Laguerre Cycle Follower

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

Thesis

Market trends exhibit persistence but are often obscured by high-frequency noise. By applying multi-iterative recursive smoothing, we can isolate the dominant trend direction. Combining this with Laguerre-transformed RSI allows for entries when momentum 'resets' within that trend, while Ehlers CG identifies cyclic exhaustion points for exits before the trend reverses. The edge exists due to the behavioral tendency of markets to over-extend before mean-reverting to a dynamic center of gravity.

Components

• SuperTrend MT5 (FxGeek) (regime) — Filters for high-volatility trend regimes to avoid entering during low-signal noise.
• Recursive Moving Average Unlimited (direction) — Determines dominant trend direction using multiple smoothing iterations to reduce high-frequency jitter.
• Laguerre RSI (entry) — Uses time-warped polynomials to identify momentum thrusts out of temporary pullbacks without the lag of standard RSI.
• Ehlers Center of Gravity (CG) (exit) — Identifies the exhaustion point of a price cycle to capture exits before trend exhaustion.
• Parabolic SAR (risk) — Provides an accelerating trailing stop that tightens as price momentum increases, protecting capital in sharp reversals.

Known failure conditions

• Consecutive losses exceeding 15% of equity indicating regime shift to mean-reversion.
• Laguerre RSI remaining pinned at 0 or 1 for more than 20 bars, rendering momentum signals useless.
• Realized volatility dropping below the SuperTrend ATR threshold for extended periods.

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).