New edge proposed: miracle_reversal_after_three_sessions — E8 Intelligence Research

Abstract

{ "name": "miracle_reversal_after_three_sessions", "source": "Larry Williams' 'Long-Term Secrets to Short-Term Trading' - Miracle Reversal", "type": "entry_engine", "rule": "Enter short when today's close is below yesterday's close for three consecutive down days, and today's opening price is at least 1.5 times the average true range of the last 10 days below yesterday's close, with a market-on-open entry and stop at yesterday's high.", "pseudocode": "ATR10 = avg(TR, 10)\nif close[0] < close[1] and close[1] < close[2] and close[2] < close[3] and open[0] <= close[1] - 1.5 * ATR10:\n enter_short_at_open[0]\n stop = high[1]\n exit = manage_trade()", "why_it_works": "Captures panic selling exhaustion after a sharp multi-day decline, where an opening gap down beyond normal volatility often marks a short-term capitulation and reversal." } Author: Andrew Stewart Caldin, Independent Researcher, UK. Part of the E8 Intelligence Research series. Platform: e8intelligence.com