Main Features
Shadow Diver
TWM
Extensions
FREE
SHADOW DIVER
Pullback strategy
Strategies
This algorithmic strategy is designed to capture momentum reversals near a key moving average. It waits for strong confirmation signals before entering a trade and uses clearly defined risk and profit management rules.
The strategy monitors price behavior relative to a moving average line. When conditions indicate that the price is bouncing off this line with strong momentum and temporary dips or spikes, it places a stop-market order slightly above or below the recent high or low to catch the breakout. Once the trade is entered, it automatically sets a take-profit and stop-loss level, canceling any opposing orders once one of them is filled
Description
🔍 Detailed Logic of Entry and Exit
🟢 Entry Conditions (Going Long or Short)
The strategy evaluates the price action relative to a moving average over the last 3 bars and places an entry only when very specific conditions are met.
✅ Long Entry Logic (Buy Setup)
The strategy enters a long position if:
- The last three closing prices are above the moving average
- →
Close[0] > MA,Close[1] > MA,Close[2] > MA - → Confirms short-term bullish momentum.
- The current candle's open is also above the moving average
- → Additional bullish confirmation — the market opened strong.
- There was a recent dip below the moving average (a wick)
- →
Low[0] < MAandLow[1] < MA - → Suggests buying pressure defended the average.
- Two bars ago, the low stayed above the moving average
- →
Low[2] > MA - → Confirms price is holding the moving average.
- Volume switch (
_vSwitch[0]) is above threshold (≥ 0.5) - → Indicates that volume or a custom condition validates the entry.
If all above are true, it places a stop-market buy order at:
🔼 High[0] + EntryOffset × TickSize
→ This ensures we only enter if the market breaks above the current high.
🔴 Short Entry Logic (Sell Setup)
A short position is entered when:
- The last three closes are below the moving average
- →
Close[0],Close[1],Close[2]all < MA - → Suggests downward trend.
- Current candle opened below the moving average
- → Market opened weak.
- The highs of the last two candles went above the moving average
- →
High[0] > MAandHigh[1] > MA - → Indicates failed attempts to go higher (bearish wicks).
- Two bars ago, high was below the moving average
- →
High[2] < MA - → Reinforces bearish sentiment.
- Volume condition
_vSwitch[0]≥ 0.5 - → Validates the signal.
If these are met, a stop-market short order is placed at:
🔻 Low[0] - EntryOffset × TickSize
→ Enter only if price breaks recent lows.
⏳ Order Timeout Logic
Once an entry order is placed:
- It stays active for a maximum of
KeepOrderBarsbars. - If not filled within this window, the order is automatically canceled to avoid outdated entries.
🧯 Exit Logic
Once in a position, the strategy manages risk and profit using predefined levels:
📉 Stop-Loss
- For Long Trades:
-
Stop = EntryPrice - (StopLoss% × EntryPrice) - For Short Trades:
-
Stop = EntryPrice + (StopLoss% × EntryPrice)
→ A stop-market order is placed to exit if price moves against us.
📈 Take-Profit
- For Long Trades:
-
ProfitTarget = EntryPrice + (Profit% × EntryPrice) - For Short Trades:
-
ProfitTarget = EntryPrice - (Profit% × EntryPrice)
→ A limit order is used to close with a profit.
🔁 Exit Order Coordination
- When one exit (stop or profit) is hit, the other is automatically canceled to avoid conflicting orders.
- Orders are also canceled if the position is manually closed using a market exit.
❌ Early Exit on Trend Reversal (Optional)
There's also a method (BelowMaExit) that can force an early exit if price crosses the moving average in the opposite direction:
- Long Position Exit:
Close[0] < MA - Short Position Exit:
Close[0] > MA
→ This logic is currently not called in OnBarUpdate() but is available for future activation.
Smart Trend Filtering
Trades only in conditions where price action confirms trend direction using a 3-bar check above or below a moving average.
Dynamic Entry Logic
Uses recent highs/lows and offsets to enter at likely breakout points instead of blindly jumping into the market.
Built-in Risk Management
Every position includes an automatic stop-loss and take-profit order based on percentages of entry price.
Order Time-to-Live Control
If an entry order is not filled within a predefined number of bars, it's automatically canceled to avoid stale entries.
FAQ
Do you have any more questions about our Extension? Let's see if we already have the answer. Please read the FAQ below.
What type of strategy is this?
A trend-following breakout strategy with pullback confirmation.
Which indicators does it use?
A single moving average is used for trend direction and as a reference point for price behavior.
How does it decide to enter a trade?
It waits for 3 consecutive closes above or below the moving average, plus certain candle shapes like wicks piercing the average.
How are entries executed?
With stop-market orders placed slightly above highs (for longs) or below lows (for shorts).
What happens if an entry order isn’t filled?
It's canceled after a fixed number of bars to avoid late or irrelevant entries.
Does it use stop-loss and take-profit?
Yes, both are placed automatically based on configurable percentages of entry price.
Is the system always in the market?
No, it enters only when strict conditions are met and stays flat otherwise.
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