This strategy is a breakout trading system that mainly buys and sells based on the breakthrough of prices. The system uses Bollinger Bands to determine the price breakthrough area. When the price breaks through the lower rail of the Bollinger Band upwards, a buy order will be placed. When the price breaks through the middle rail or lower rail of the Bollinger Band downwards, a sell order will be placed.
This strategy uses Bollinger Bands to determine price breakthrough areas. Bollinger Bands consist of a simple moving average line of n days and its standard deviation multiplier. Here we calculate the 20-day moving average of highest price and lowest price to determine the upper and lower rail of Bollinger Bands, as well as the average of upper and lower rail as the baseline.
When the close price breaks through the lower rail upwards, it indicates that the price starts to go up which is a buy signal. When the close price breaks through the middle or lower rail downwards, it indicates that the rising trend ends and positions need to be sold out. This strategy takes advantage of the tendency of prices to continue running up or down after the breakthrough to make profits.
Solutions:
This is a price breakthrough trading strategy based on Bollinger Bands. It takes advantage of the characteristics of price breakthroughs to identify trading opportunities. The advantages are that it is simple, easy to implement; the disadvantages are that there may be false breakouts leading to losses. We can optimize this strategy by adjusting parameters, incorporating other indicators and setting stop loss to achieve good results in backtesting and live trading. In general, this strategy is suitable for market environments that can fully tap the trending tendency of prices.
/*backtest start: 2023-02-14 00:00:00 end: 2024-02-20 00:00:00 period: 1d basePeriod: 1h 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 //Break out trading system works best in a weekly chart and daily chart of Nifty and BankNifty //@version=4 strategy("Eswar New",shorttitle = "ESW") length = input(20, minval=1) exit = input(1, minval=1, maxval=2,title = "Exit Option") // Use Option 1 to exit using lower band; Use Option 2 to exit using basis line lower = lowest(length) upper = highest(length) basis = avg(upper, lower) l = plot(lower, color=color.blue) u = plot(upper, color=color.blue) plot(basis, color=color.orange) fill(u, l, color=color.blue) longCondition = crossover(close,upper[1]) if (longCondition) strategy.entry("Long", strategy.long) if(exit==1) if (crossunder(close,lower[1])) strategy.close("Long") if(exit==2) if (crossunder(close,basis[1])) strategy.close("Long")template: strategy.tpl:40:21: executing "strategy.tpl" at <.api.GetStrategyListByName>: wrong number of args for GetStrategyListByName: want 7 got 6