Enhancing Basic Volatility Breakout System

Enhancing Basic Volatility Breakout System:

Adding filters can sometimes create further enhancements. Examples of types of filters include: indicators to determine whether or not the market is trending condition, seasonality, days a week, or the degree of contraction instability already present in the market. Periods of low volatility in the market can be identified with the contraction in the right range, a low ADX, or statistical indicator such as a low historical volatility ratio or a low standard deviation.
The system then might look something like this:
1st Initial state of instability = true
2nd Buy or sell based on open and stop the current tape, plus or minus one percent band from the previous day.
3rd Home Risk management stops once a trade is concluded.
4th Exit strategies.
Types of variables that can be used in a simple range expansion breakout system:
1st Period - is a breakout on the function of the previous day or previous 10-day period, for example?
2nd Scope - does not use the average range for this time or the biggest, smallest, or total range?
3rd Percentage - the percentage of coverage is used? It is possible, for example, to use 120% of the total number of the previous 3 days.
4th Base - is the range function added to close the day before or the day is open. This feature can be added to the high or low of previous bar or the previous period, which lasts 10 days.
As a general rule, the greater the percentage factor used, the greater the percentage of winning trades will be. However, the entire system can be less profitable because fewer trades are taken.
Once again, as an initial condition can be: Enter a trade just one day after the narrowest election in the last 7 days. Or, take a trade only if the market has made a new 20-day high or low in the last five trading days. Whenever you add a filter system, be sure to compare the results of the baseline and to examine the difference in level of activity.