The Volatility Breakout strategy seeks strong directional moves when price escapes from its average range. By measuring the distance from a simple moving average using the Average True Range, the algorithm defines breakout thresholds that scale with volatility. 
A buy order is triggered when the close rises above the SMA by more than 
Multiplier times the ATR. A sell signal appears when the close falls below the SMA by the same distance. Positions remain open until an opposite breakout occurs or a protective stop is hit. 
This technique caters to intraday traders who thrive on momentum surges. Using ATR-based thresholds helps filter out noise so only significant moves generate trades. 
 
- Entry Criteria: 
  
 
- Long: Close > SMA + Multiplier * ATR 
 
- Short: Close < SMA - Multiplier * ATR 
 
 
 
- Long/Short: Both sides. 
 
- Exit Criteria: 
  
 
- Long: Exit when an opposite breakout triggers or stop-loss hits 
 
- Short: Exit when an opposite breakout triggers or stop-loss hits 
 
 
 
- Stops: Yes, stop-loss at Multiplier * ATR from entry. 
 
- Default Values: 
  
 
- Period = 20 
 
- Multiplier = 2.0m 
 
- CandleType = TimeSpan.FromMinutes(5) 
 
 
 
- Filters: 
  
 
- Category: Breakout 
 
- Direction: Both 
 
- Indicators: SMA, ATR 
 
- Stops: Yes 
 
- Complexity: Intermediate 
 
- Timeframe: Intraday 
 
- Seasonality: No 
 
- Neural networks: No 
 
- Divergence: No 
 
- Risk Level: Medium