Heikin-Ashi candles smooth noise and highlight trend direction. A shift from a series of bearish HA candles to a bullish one, or vice versa, can indicate a change in momentum. This strategy trades those color flips and uses a percentage stop for protection.
The logic calculates Heikin-Ashi values from regular candles. When the HA close crosses above the HA open after a bearish sequence, a long is taken. A cross below after a bullish run opens a short. The stop is placed a fixed percentage away from entry.
The method is simple yet effective during choppy swings when traditional candlesticks are noisy.
- Entry Criteria: Heikin-Ashi candle changes color.
- Long/Short: Both.
- Exit Criteria: Stop-loss.
- Stops: Yes, percentage based.
- Default Values:
- CandleType = 15 minute
- StopLoss = 2%
- Filters:
- Category: Reversal
- Direction: Both
- Indicators: Heikin-Ashi
- Stops: Yes
- Complexity: Basic
- Timeframe: Intraday
- Seasonality: No
- Neural networks: No
- Divergence: No
- Risk level: Medium