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11 Apr, 6 tweets, 2 min read
Small thread on ATRSTOCHA Strategy:

One of the strategies I follow with extreme bearish or bullish environment is the ATRSTOCHA. Which I shared in TC21. Sharing it here for wider reach

Along with Stocha. (OB / OS), ATR (Upper Band vs Lower Band) gives good Mean Reversal
1/
Need - ATR Band (21-3), Stochastics (default
)and HK (to be used as an indicator)

ATR: ATR is price actions', GPS. ATR informs as to where the current price action is in relationship to possible ranges it could move in. This helps with a directional bias.

2/
If we plot an ATR band (Upper & Lower), it will give the range. A band is plotted around ATR to determine if the price is in an uptrend, downtrend or moving in a sideways pattern

3/
The Strategy: When prices touch the Upper/ Lower Range of the ATR band along with Stocha in OB / OS zones, probabilities of mean reversion increases. This gets confirmation with the changing Heikin-Ashi candles

4/
Short: Bearish Reversal HA candles in the upper range of ATR along with Stocha being OB (Slope of Stocha need to be downward with %D>%K

Long: Bullish Reversal HA candles in the lower range of ATR along with Stocha being OS zones (Slope of Stocha need to be upward with %K > %

5/
These have higher probability of Mean Reversion.

Stop loss can be kept with previous day low OR swing low for long setup and vice versa for Shorts OR 1.5 ATR

Don't follow this blindly, please backrest at your end before following it up. It works nicely in Indexes as well.

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