This strategy is designed to allow you to catch the bounce or "SNAP Back" of an equity that has been in a trend.
1) Once the moving averages are in the order of 200SMA > 50 > 34EMA > 20SMA > 8EMA (or reverse for and uptrend), the strategy is setup.
2) Next you wait for a trigger of the closing price crossing the 8EMA, while there is a desired gap size between the 8EMA and the 20SMA (2-10% of stock value preferred).
3) Exit position based on target profit reached (conservative sell half at 34EMA and engage a trailing stop loss for remainder or set static limit) or price crosses 8EMA or stop loss%
*)This code also allows you to determine your desired backtesting date compliments of alanaster
This code is the product of many hours of hard work on the part of the greater tradingview community. The credit goes to everyone in the community who has put code out there for the greater good.
The idea for the coding came from a video I watched on YouTube presented by TradeStation called Snap Back - thank you guys for the inspiration.
UPDATE: I have coded the other side of the strategy to allow you to take advantage of the same set-up in an uptrend for Short plays. You can turn the up or downsides on, off, or both.
The main intent is to catch the bounces of a falling stock. However, I have found that you can do the inverse and catch the drops in a rising stock (the latter is not as reliable). This also tends to work better on less volatile stocks. I have included a large of user defined conditions and display entry and exit conditions on the chart to see how your choices are impacting the script.
2) Updated exit conditions
1) You can now select the MD_SMA as an exit condition
2) You can chose to run the Trailing Stop Loss Jointly or Exclusively
The Default values have also be updated and are now optimized for Day Trading on a 2 min chart (Back Testing XLE from 01JAN2022 to present)
As always enjoy and use at your own risk, strategy is for discussion purposes and is not a recommendation to buy, sell or trade anything.