The DipTrendCatcher is a trend-following strategy designed for strong bullish markets to capture low-timeframe opportunities.
It identifies uptrends using the alignment of three EMAs: Fast > Mid > Slow. For additional confirmation, the strategy requires the bullish alignment to persist for a predefined number of bars (bullish lookback), ensuring trades only occur in sustained uptrends. The strategy enters a long position when the price dips below the Slow EMA and reclaims the Fast EMA. Positions are exited when the price crosses below the Fast EMA.
This strategy is only effective in strong bullish phases and relies on the trader's ability to correctly identify such market conditions. It has been tested on BTC with a 5-minute timeframe, though performance can vary significantly depending on the exchange, chart type (e.g., Bybit, Binance), and timeframe. To achieve optimal results, traders should optimize parameters, including the EMA lengths and bullish lookback, and thoroughly backtest the strategy. Deploying it in sideways or bearish markets will result in poor performance. Proper market phase identification and alignment with bullish trends are critical for success.