DEMA ATR Strategy [PrimeAutomation]

⯁ OVERVIEW
The DEMA ATR Strategy combines trend-following logic with adaptive volatility filters to identify strong momentum phases and manage trades dynamically.
It uses a Double Exponential Moving Average (DEMA) anchored to ATR volatility bands, creating a self-adjusting trend baseline.
When the adjusted DEMA shifts direction, the strategy enters positions and scales out profit in phases based on ATR-driven targets.

This system adapts to volatility, filters noise, and seeks sustained directional moves.

⯁ KEY FEATURES

• DEMA-Volatility Hybrid Filter
  Uses Double EMA with ATR expansion/compression logic to form a dynamic trend baseline.
  
• Directional Shift Entries
  Entries occur when the adjusted DEMA flips trend (bullish crossover or bearish crossunder vs its past value).
  
• Noise Reduction Mechanism
  ATR range caps extreme moves and prevents false flips during choppy volatility spikes.
  
• Multi-Level Take Profits
  Targets scale out positions at 1×, 2×, and 3× ATR multiples in the trade direction.
  
• Volatility-Adaptive Targets
  ATR multiplier ensures profit targets expand/contract based on market conditions.
  
• Single-Direction Exposure
  No pyramiding; the strategy flips position only when trend shifts.
  
• Automated Trade Finalization
  When all profit targets trigger, the position is fully closed.
  

⯁ STRATEGY LOGIC

• Trend Direction:
  DEMA baseline is modified using ATR upper/lower envelopes.
  • If the adjusted DEMA rises above previous value → Bullish
  • If it falls below previous value → Bearish
  
• Entry Rules:
  • Enter Long when bullish shift occurs and no long position exists
  • Enter Short when bearish shift occurs and no short position exists
  
  
• Take Profit Logic:
  3 partial exits for each trade based on ATR:
  • TP1 = ±1× ATR
  • TP2 = ±2× ATR
  • TP3 = ±3× ATR
  Profit distribution: 30% / 30% / 40%
  
• Exit Conditions:
  • Exit when all TPs hit (full scale-out if sum of all TPs 100%)
  • Opposite trend signal closes current trade and opens new one
  

⯁ WHEN TO USE

• Trending environments
  
• Medium–high volatility phases
  
• Swing trading and intraday trend plays
  
• Markets that respect momentum continuation (crypto, indices, FX majors)
  

⯁ CONCLUSION
This strategy blends DEMA trend recognition with ATR-based volatility adaptation to generate cleaner directional entries and structured take-profit exits. It is designed to capture momentum phases while avoiding noise-driven false signals, delivering a disciplined and scalable trend-following approach.