New edge proposed: gann_swing_retracement_timing — E8 Intelligence Research

Abstract

{ "name": "gann_swing_retracement_timing", "source": "W.D. Gann / Gann Swing Trading (Swing Chart Rules)", "type": "entry_engine", "rule": "When price makes a new swing high (higher high) but closes below the prior swing high close, enter short at the next 50% retracement of the last swing up (from low to high), provided the retracement occurs within 3 bars and the close is below the 5-period SMA.", "pseudocode": "if bar[i].high > swing_high_prior and bar[i].close < close_of_swing_high_bar:\n swing_up_low = lowest_low_of_last_5_bars_before_swing_high\n swing_up_high = bar[i].high\n target = swing_up_high - 0.5 * (swing_up_high - swing_up_low)\n for j in i+1 to i+3:\n if bar[j].low <= target and bar[j].close < sma(5, close)[j]:\n enter_short_at(target, stop_loss=swing_up_high + 1*atr)\n break", "why_it_works": "Gann's 50% retracement is a key geometric level where price often pauses or reverses, and combining it with a failed new high (lowe Author: Andrew Stewart Caldin, Independent Researcher, UK. Part of the E8 Intelligence Research series. Platform: e8intelligence.com