Kairos Strategy

1 de dez.

Kairos meaning: The right or critical moment

Overview
Kairos Strategy combines multiple technical indicators and filters to create a robust framework for identifying, confirming, and managing trade entries in both trending and ranging markets. The strategy's core revolves around Hull Moving Average (HMA) variants for primary trend detection, supported by VWMA, SMMA, and ZLSMA for precision in signal confirmation. The integration of Parabolic SAR, ATR-based Stop Loss, and RSI filters ensures accurate entry points and risk control. This multi-layered approach provides flexibility and reliability across timeframes and market conditions.

Methodology
The Kairos Strategy employs a systematic approach to analyze market dynamics:

Primary Trend Identification
The Hull Moving Average (HMA) and its variants (THMA and EHMA) detect major trends.
Users can adjust sources like VWMA, SMMA, and ZLSMA for improved accuracy and trend clarity.

Multi-Indicator Integration
Parabolic SAR signals align with price direction to identify actionable trade zones.
RSI Filters ensure trades occur during optimal momentum conditions, avoiding overbought/oversold areas.

Dynamic Risk Management
ATR-based Stop Loss adapts to volatility, ensuring proper risk/reward ratios.
A customizable trailing stop follows price movements, locking profits while minimizing risk.

Signal Filtering
To enhance reliability, entries are validated by avoiding conditions where price interacts directly with the moving averages.

Customization and Flexibility
The Kairos Strategy empowers traders to adapt to different trading styles and market environments through an array of customizable settings. Each component of the strategy is fine-tuned for flexibility and precision, ensuring it meets the diverse needs of its users.

Configurable Indicators and Sources

• Select from multiple moving average options, including LSMA, VWMA, SMMA, VAMA, and ZLSMA, for trend identification and crossover signals.
  
• Adjust the length, smoothing type, and multiplier settings for each indicator to suit various market conditions and timeframes.
  
• Incorporate higher timeframes for broader trend validation without sacrificing detail on lower timeframes.
  

Risk-Reward Optimization

• Define distinct risk-reward ratios for both long and short trades, allowing for tailored approaches to each market scenario.
  
• Enable ATR-based stop-loss calculations for adaptive risk management that responds to market volatility.
  
• Utilize bar-based stop-loss levels for simpler, price-action-driven risk placement.
  

Strategy Logic
The Kairos Strategy's multi-layered logic is designed to maximize trading opportunities while minimizing false signals:

Entry Conditions

• Crossover Signals: The strategy identifies buy or sell signals when a selected moving average crosses over the Hull MA in the direction of the trend.
  
• Momentum Validation: RSI filters ensure that entries are aligned with favorable momentum conditions, reducing exposure to false signals during choppy markets.
  
• Trend Alignment: Parabolic SAR confirms that entries align with the current price trend, adding an additional layer of validation.
  
• Price Interaction Check: The strategy avoids signals when price touches key levels, such as the moving averages or crossover sources, ensuring cleaner entries.
  

Exit Conditions

• Stop-Loss Placement: Choose between ATR-based or bar-based stop-loss calculations, ensuring exits are optimized for risk control.
  
• Take-Profit Targets: Automatically calculated based on customizable risk-reward ratios, providing a consistent framework for locking in gains.
  
• Trailing Stops: Optional trailing stops dynamically adjust with price movement, preserving profits as trends evolve.
  

Key Benefits

1. Versatility Across Markets: Effective in both trending and ranging conditions, with settings adaptable to any trading style.
   
2. Enhanced Signal Accuracy: Multi-indicator validation and dynamic filtering reduce noise and improve entry timing.
   
3. Robust Risk Management: Advanced stop-loss and risk-reward configurations safeguard capital while optimizing trade potential.
   
4. User-Friendly Interface: Intuitive settings and customizable visuals make the strategy accessible to both novice and experienced traders.
   

Use Cases

• Trend Trading: Utilize the Hull MA and its variants to capture long-term trends with precision and confidence.
  
• Scalping: Leverage shorter timeframes and the strategy's adaptive indicators for quick, high-frequency trades.
  
• Swing Trading: Combine multi-timeframe analysis and dynamic stop-loss settings to capture medium-term market moves.
  

Backtest Results
Symbol: BTCUSDT.P Bitcoin / TetherUS PREPERTUAL CONTRACT Binance
Timeframe: 1h
Operating window: Date range of backtests is 2022.01.08 - 2024.11.26. It is chosen to let the strategy to close all opened positions.
Commission and Slippage: Includes a standard Binance commission of 0.07% and accounts for possible slippage over 5 ticks.
Initial capital: 1000 USDT
Percent of capital used in every trade: 100 USDT on 30x leverage = 3000 USDT
Maximum Single Profit: 463.95 USDT
Maximum Single Position Loss: 219.34 USDT
Net Profit: +7,302.60 USDT (730.26%)
Total Trades: 156 (52.56% Win rate)
Profit Factor: 2.443
Maximum Drawdown: 640.29 USDT (-29.65%)
Average Profit per Trade: 46.81 USDT (+1.56%)

I recommend this strategy for leverage trading, that's why the trading properties are set this way!

Disclaimer
This tool is designed for educational and informational purposes, reflecting Kairos dedication to empowering traders with knowledge. Keep in mind that past performance is not indicative of future results. Always test strategies in a simulated environment before applying them in live markets.