Hermes — Strategy by aicccia

By aicccia

Performance Metrics

Description

HERMES STRATEGY - TRADINGVIEW DESCRIPTIONOVERVIEWHermes is an adaptive trend-following strategy that uses dual ALMA (Arnaud Legoux Moving Average) filters to identify high-quality entry and exit points. It's designed for swing and position traders who want smooth, low-lag signals with minimal whipsaws.Unlike traditional moving averages that operate on price, Hermes analyzes price returns (percentage changes) to create signals that work consistently across any asset class and price range.HOW IT WORKSDUAL ALMA SYSTEMThe strategy uses two ALMA lines applied to price returns:• Fast ALMA (Blue Line): Short-term trend signal (default: 80 periods)• Slow ALMA (Black Line): Long-term baseline trend (default: 250 periods)ALMA is superior to simple or exponential moving averages because it provides:• Smoother curves with less noise• Significantly reduced lag• Natural resistance to outliers and flash crashesTRADING LOGICBUY SIGNAL:• Fast ALMA crosses above Slow ALMA (bullish regime)• Price makes new N-bar high (momentum confirmation)• Optional: Price above 200 EMA (macro trend filter)• Optional: ALMA lines sufficiently separated (strength filter)SELL SIGNAL:• Fast ALMA crosses below Slow ALMA (bearish regime)• Optional: Price makes new N-bar low (momentum confirmation)The strategy stays in position during the entire bullish regime, allowing you to ride trends for weeks or months.VISUAL INDICATORSLINES:• Blue Line: Fast ALMA (short-term signal)• Black Line: Slow ALMA (long-term baseline)TRADE MARKERS:• Green Triangle Up: Buy executed• Red Triangle Down: Sell executed• Orange "M": Buy blocked by momentum filter• Purple "W": Buy blocked by weak crossover strengthKEY PARAMETERSALMA SETTINGS:• Short Period (default: 30) - Fast signal responsiveness• Long Period (default: 250) - Baseline stability• ALMA Offset (default: 0.90) - Balance between lag and smoothness• ALMA Sigma (default: 7.5) - Gaussian curve widthENTRY/EXIT FILTERS:• Buy Lookback (default: 7) - Bars for momentum confirmation (required)• Sell Lookback (default: 0) - Exit momentum bars (0 = disabled for faster exits)• Min Crossover Strength (default: 0.0) - Required ALMA separation (0 = disabled)• Use Macro Filter (default: true) - Only enter above 200 EMABEST PRACTICESRECOMMENDED ASSETS - Works well on:• Cryptocurrencies (Bitcoin, Ethereum, etc.)• Major indices (S&P 500, Nasdaq)• Large-cap stocks• Commodities (Gold, Oil)RECOMMENDED TIMEFRAMES:• Daily: Primary timeframe for swing trading• 4-Hour: More active trading (increase trade frequency)• Weekly: Long-term position tradingPARAMETER TUNING:• More trades: Lower Short Period (60-80)• Fewer trades: Raise Short Period (100-120)• Faster exits: Set Sell Lookback = 0• Safer entries: Enable Macro Filter (Use Macro Filter = true)STRATEGY ADVANTAGES1. Low Lag - ALMA provides faster signals than traditional moving averages2. Smooth Signals - Minimal whipsaws compared to crossover strategies3. Asset Agnostic - Same parameters work across different markets4. Trend Capture - Stays positioned during entire bullish regimes5. Risk Management - Multiple filters prevent poor entries6. Visual Clarity - Easy to interpret regime and filter statesWHEN TO USE HERMESBEST FOR:• Trending markets (crypto bull runs, equity uptrends)• Swing trading (hold days to weeks)• Position trading (hold weeks to months)• Clear trend identification• Risk-managed exposureNOT SUITABLE FOR:• Ranging/sideways markets• Scalping or day trading• High-frequency trading• Mean reversion strategiesRISK DISCLAIMERThis indicator is for educational purposes only. Past performance does not guarantee future results. Always use proper position sizing and risk management. Test thoroughly on historical data before live trading.CREDITSInspired by Giovanni Santostasi's Power Law Volatility Indicator, generalized for universal application across all assets using adaptive ALMA filtering.Strategy by Hermes Trading SystemsQUICK START1. Add indicator to chart2. Use on daily timeframe for best results3. Look for green buy signals when blue line crosses above black line4. Exit on red sell signals when blue line crosses below black line5. Adjust parameters based on your trading style: • Conservative: Enable Macro Filter, increase Buy Lookback to 10 • Aggressive: Disable Macro Filter, lower Short Period to 60 • Default settings work well for most assets

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