123 Reversal and Fisher Transform Indicator Combo Strategy
This strategy is named “123 Reversal and Fisher Transform Indicator Combo Strategy”. It incorporates the 123 reversal pattern and Fisher transform indicator, entering trades when both give concurring signals.
The 123 reversal pattern refers to prices gaping significantly over three consecutive days with the third day closing in the opposite direction of the previous two days. Statistically, 123 reversals have higher win rates.
The Fisher transform indicator normalizes prices into a Gaussian-like curve, and its extreme swing turning points can effectively identify price reversals.
The trading logic is:
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The 123 reversal pattern shows buy or sell signals.
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The Fisher transform curve shows buy or sell signals.
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When the two give concurring signals, the corresponding buy or sell trades are taken.
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When the two give opposing signals, positions are kept flat.
The advantage of this strategy is the indicator combo can improve judgment accuracy of reversal timing. But parameter optimization is still crucial, and rigorous money management is a must.
In conclusion, indicator integration forms a more comprehensive analytical perspective. But traders still need sufficient discretion to adjust strategies based on market conditions.
/*backtest
start: 2023-08-13 00:00:00
end: 2023-09-12 00:00:00
period: 4h
basePeriod: 15m
exchanges: [{"eid":"Futures_Binance","currency":"BTC_USDT"}]
*/
//@version=4
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// Copyright by HPotter v1.0 28/08/2020
// This is combo strategies for get a cumulative signal. - 1