Investing & Trading

Gandalf Project Research System Strategy

By Samantha Baltodano


TL;DR:

The Gandalf Project Research System is a trading strategy that uses data like the candle average price, median price, and mid-body value to identify points of price weakness and strength for generating buy and sell signals. It uses specific conditions to generate entry and exit signals and can be applied to any market.


What Is The Gandalf Project Research System Strategy?

The world of trading can be complex and challenging, requiring traders to develop robust and effective strategies to achieve financial success. 


One of these strategies is the Gandalf Project Research System, developed by Domenico D'Errico and Giovanni Trombetta.


So, what is the Gandalf Project Research System?


The Gandalf Project Research System is a trading strategy that can help traders identify points of price weakness and strength more accurately to generate buy and sell signals. 


By using data like the candle average price (ohlc4), median price, and mid-body value, the strategy can identify specific patterns and trends in the market, which can provide valuable insights into future price changes. This can help traders make more accurate predictions and generate higher profits.


The Math Behind the Strategy

The strategy uses a set of conditions to generate simulated buy to open and sell to close orders. 


The buy signal is generated if either of the following conditions are met:


  1. The previous ohlc4 is less than the previous median price, and the median price from 2 bars ago is less than or equal to the previous ohlc4, and the median price from 2 bars ago is less than or equal to the ohlc4 from 3 bars ago.
  2. The previous ohlc4 is less than the median price from 3 bars ago, and the current mid-body price is less than the median price from 2 bars ago, and the previous mid-body price is less than the mid-body price from 2 bars ago.


On the other hand, the sell signal is generated if any of the following conditions are true:


  1. A specified exit number of bars elapses after an entry.
  2. A specified gain-exit number of bars elapses after an entry while the close price is greater than the entry price.
  3. Close price is less than the entry price, and either of the additional conditions is true.


Additional conditions for the sell signal are:


  1. The previous ohlc4 is less than the previous mid-body price, and the median price from 2 bars ago equals the mid-body price from 3 bars ago, and the previous mid-body price is less than or equal to the mid-body price from 4 bars ago.
  2. The ohlc4 from 2 bars ago is less than the current mid-body price, and the median price from 4 bars ago is less than the ohlc4 from 3 bars ago, and the previous mid-body price is less than the previous ohlc4.


How to Use the Strategy

To use the Gandalf Project Research System strategy, traders need to identify the appropriate conditions for generating buy and sell signals. The strategy can be applied to any market, including stocks, commodities, and forex.


Traders can use the conditions outlined above to identify points of price weakness and strength and generate entry and exit signals. 


Test The Gandalf Project Research System Strategy

Great news! 


You can back test this exact strategy on historical data for any of your favorite symbols using TradingView. 


This strategy has already been built and all you have to do is log in and take it for a spin. You can access this indicator here.


If you’re new to back testing and to TradingView, don’t worry. I created a step-by-step guide you can follow to begin testing the Gandalf Project Research System Strategy.


Summary

  • The Gandalf Project Research System is a trading strategy developed by Domenico D'Errico and Giovanni Trombetta to identify points of price weakness and strength for generating buy and sell signals.
  • The strategy uses data such as candle average price, median price, and mid-body value to identify specific patterns and trends in the market, providing valuable insights into future price movements.
  • The buy signal is generated if specific conditions are met, such as the previous ohlc4 being less than the previous median price, and the median price from 2 bars ago is less than or equal to the previous ohlc4, and the median price from 2 bars ago is less than or equal to the ohlc4 from 3 bars ago.
  • The sell signal is generated if specific exit or gain-exit criteria are met, such as a specified number of bars elapsing after an entry or the close price being less than the entry price.
  • Additional conditions for the sell signal include the previous ohlc4 being less than the previous mid-body price and the ohlc4 from 2 bars ago being less than the current mid-body price.


Gandalf Project Research System is just one of many strategies that Archaide automates. For a full list of strategies and studies available click here.


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