TRADLEWARE-Gaussian Channel + StochRSI ETH

Gaussian Channel + Stochastic RSI ETH

This strategy combines a fast Gaussian Channel with a Stochastic RSI filter and a 200-day SMA bull-market gate, aimed at catching trend continuation while sitting out confirmed downtrends.

How it works

The Gaussian Channel is a smoothed price envelope built with an IIR (infinite impulse response) filter — a mathematically elegant alternative to a simple moving average. It applies a bell-curve weighting across recent bars, producing smooth, low-lag output. The channel is formed by adding and subtracting a filtered measure of true range (volatility) around the central filter line.

The channel turns green when the filter is rising (uptrend) and red when it is falling (downtrend). A separate 200-day simple moving average acts as a bull/bear regime switch: the strategy only trades when price is above it.

Entry

A long position is opened when all five conditions are true simultaneously:

The channel is green (filter rising — uptrend confirmed)
Price closes above the upper band (breakout above the channel; an optional buffer above the band can require more room, but testing found this counterproductive — see Parameters)
Stochastic RSI %K is either above 80 (strong momentum confirming the breakout) or below 25 (oversold dip within the uptrend)
Price is above the 200-day SMA (bull regime — can be disabled)
The signal bar itself closes above its own open — a bullish candle (can be disabled)

The bullish-candle check filters out breakout bars that clear the upper band intrabar but still close weak — a common precursor to an immediate whipsaw exit on the next bar.

The 200-day SMA gate exists specifically to block breakout entries that fire during bear-market bounces — dead-cat rallies that look like trend resumption on the channel and oscillator alone but occur underneath a still-falling long-term average.

Exit

The position is closed when either:

Price closes back below the upper band (breakout has failed or the trend is cooling), or
The channel reverses from green to red (trend direction has flipped)

An optional stop-loss (on by default) is placed at the lower band and trails as the channel moves, providing a floor on losses if price drops sharply through both the upper and lower bands in the same move. The regime gate only blocks new entries — it does not force an exit on its own if price falls back below the 200-SMA mid-trade.

Parameters

Poles: 4 (filter smoothness — higher = smoother but more lag)
Sampling Period: 89 (faster channel than the baseline version, reacts sooner to trend changes)
True Range Multiplier: 1.5 (controls channel width)
Stochastic RSI overbought threshold: 80
Stochastic RSI oversold threshold: 25 (a parameter sweep found a stable plateau from 22-28; 25 sits at its center rather than its single best value)
200-SMA regime gate: on by default, can be disabled; length is adjustable
Bullish entry candle requirement: on by default, can be disabled
Entry breakout buffer: 0% (off) by default; tested at multiple levels above 0% and found to reduce returns at every level, so left disabled
Stop-loss at lower band: on by default, can be disabled
Start/End date range inputs let you restrict the backtest window without editing code

Costs modelled

0.1% commission per side, 3 ticks slippage, fills at next bar's open.

Intended assets and timeframe

Daily bars. Designed and validated on ETH/USDT. Likely applicable to other trending crypto assets; not validated on equities.

Known limitations

Underperforms in choppy or ranging markets — the upper band breakout condition generates whipsaws when price oscillates without directional conviction. The regime gate is a trade-off: it blocks bear-bounce false starts, but it also means the strategy can miss the first leg of a genuine new uptrend until price reclaims the 200-day SMA. The filter requires several hundred bars of history to fully converge; results on very short histories may differ from the validated backtest. The strategy trades infrequently (around 28 trades on the validated window), so treat any single backtest run as a small sample rather than a statistically strong result.

Credit

The Gaussian Channel filter is from the open-source "Gaussian Channel (DW)" indicator by DonovanWall. This script reuses that filter and adds the Stochastic RSI entry filter, the 200-day SMA regime gate, exit rules, stop-loss, and full strategy order management on top of it.

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Feragatname

Bilgiler ve yayınlar, TradingView tarafından sağlanan veya onaylanan finansal, yatırım, alım satım veya diğer türden tavsiye veya öneriler anlamına gelmez ve teşkil etmez. Kullanım Koşulları bölümünde daha fazlasını okuyun.

cs_lev