The Three Color Cross Trend Tracking Strategy is a trend following trading strategy based on candlestick patterns. It identifies the direction of the current trend by recognizing specific three color candlestick patterns and selectively goes long or short when the patterns are identified.
The core logic of this strategy is: When three consecutive candlesticks of the same color (three red or three green) appear, followed by one candlestick of the opposite color, and then reverse back to the original three candlesticks’ color, it indicates the original trend is continuing. Therefore, this is the time to track the trend by entering into a position.
Specifically, the strategy detects the situation of the most recent five candlesticks to determine if the entry criteria are met. If the most recent five candlesticks are: the fifth candle has a lower low than the previous one (higher high for long), the fourth candle is a bullish candle (bearish for long), the third candle is a bearish candle (bullish for long), the second candle is a bearish candle (bullish for long), and the first candle is a bearish candle (bullish for long), then a short tracking position is opened. On the contrary, if the most recent five candlesticks are: the fifth candle has a higher high than the previous one, the fourth candle is a bearish one, the third candle is a bullish one, the second candle is a bullish one, and the first candle is a bullish one, then a long tracking position is opened. By judging the trend direction through such specific candlestick patterns, additional profits can be made when the trend persists.
The Three Color Cross Trend Tracking Strategy identifies current trend direction by recognizing specific candlestick patterns, and selectively opens positions when the trend persists. This strategy is simple, clear, easy to operate, and capable of gaining additional profits during trend stages. But it also carries some risks, and needs further optimization to improve stability. Overall, it serves as an effective complementary component in quantitative trading strategy portfolios.
/*backtest start: 2024-01-20 00:00:00 end: 2024-02-19 00:00:00 period: 3h basePeriod: 15m exchanges: [{"eid":"Futures_Binance","currency":"BTC_USDT"}] */ // This source code is subject to the terms of the Mozilla Public License 2.0 at https://mozilla.org/MPL/2.0/ // © softinterface2000 //@version=5 strategy("3 Line Strick", overlay=true, margin_long=100, margin_short=100) //Sell fifth= close < low[1] fourth= close[1] > open[1] third= close[2] < open[2] seccond= close[3] < open[3] first= close[4] < open[4] //Buy fifth1= close > high[1] fourth1= close[1] < open[1] third1= close[2] > open[2] second1= close[3] > open[3] first1= close[4] > open[4] longCondition = fifth1 and fourth1 and third1 and second1 and first1 if (longCondition) strategy.entry("Long", strategy.long) shortCondition = fifth and fourth and third and seccond and first if (shortCondition) strategy.entry("Short", strategy.short)template: strategy.tpl:40:21: executing "strategy.tpl" at <.api.GetStrategyListByName>: wrong number of args for GetStrategyListByName: want 7 got 6