Entry Rules

Entry rules define the conditions under which your strategy opens a new position. Arconomy provides a comprehensive library of pre-built entry rules covering technical indicators, price action patterns, and volume-based signals. Each rule can be configured with custom parameters and combined with other rules to create sophisticated entry logic.

How Entry Rules Work

An entry rule evaluates market data on every tick or bar close (depending on your strategy's evaluation mode) and produces a boolean signal: either the entry condition is met, or it is not. When all active entry rules on a strategy's canvas emit a true signal simultaneously, the strategy generates an entry order.

Entry rules can be combined in two ways on the canvas:

• AND logic — Connect multiple entry rules in series. All conditions must be true at the same time for an entry to trigger.
• OR logic — Place entry rules in parallel branches. Any single branch evaluating to true will trigger an entry.

Moving Average Crossover

Overview

The Moving Average Crossover rule generates an entry signal when a faster moving average crosses above (for long entries) or below (for short entries) a slower moving average. This is one of the most widely used trend-following entry signals and serves as an excellent starting point for new strategies.

The rule supports multiple moving average types, allowing you to choose the calculation method that best suits your trading style and the instrument you are trading.

Key Parameters

Parameter	Description	Default	Range
Fast MA Period	The lookback period for the faster moving average	20	2 – 500
Slow MA Period	The lookback period for the slower moving average	50	2 – 500
MA Type	The calculation method: Simple (SMA), Exponential (EMA), Weighted (WMA), or Hull (HMA)	EMA	—
Direction	Long Only, Short Only, or Both	Both	—
Price Source	The price field used for calculation: Close, Open, High, Low, HL2, HLC3	Close	—

Typical Use Case

The Moving Average Crossover is ideal for trend-following strategies on higher timeframes (1H and above). A common configuration is a 20/50 EMA crossover on the 4-hour chart for forex pairs or equity indices. This combination balances responsiveness with noise reduction, generating signals that align with the prevailing trend while filtering out short-term fluctuations.

Entry Rule: MA Crossover
  Fast MA: 20 EMA
  Slow MA: 50 EMA
  Direction: Long Only
  Price Source: Close
  Timeframe: 4H

RSI Threshold

Overview

The RSI (Relative Strength Index) Threshold rule generates an entry signal when the RSI value crosses above or below a specified level. This rule is commonly used for mean-reversion strategies, entering positions when an instrument reaches oversold or overbought conditions with the expectation that the price will revert toward its average.

Key Parameters

Parameter	Description	Default	Range
RSI Period	The lookback period for the RSI calculation	14	2 – 200
Overbought Level	The RSI value above which the instrument is considered overbought	70	50 – 99
Oversold Level	The RSI value below which the instrument is considered oversold	30	1 – 50
Signal Type	Cross Above Oversold (long), Cross Below Overbought (short), or Both	Both	—
Price Source	The price field used for RSI calculation	Close	—

Typical Use Case

An RSI Threshold rule configured with a 14-period RSI and 30/70 levels works well for range-bound markets. For more aggressive mean-reversion strategies, tightening the levels to 25/75 or using a shorter RSI period (such as 7) produces more frequent signals. Pair this entry rule with a Trend Filter to avoid mean-reversion entries against a strong trend.

Breakout Detection

Overview

The Breakout Detection rule identifies when price moves beyond a defined range, signalling the beginning of a potential new trend. The rule calculates dynamic support and resistance levels based on recent price action and triggers when price decisively breaks through these levels.

Key Parameters

Parameter	Description	Default	Range
Lookback Period	Number of bars used to calculate the range high and low	20	5 – 200
Breakout Type	High/Low Channel, Donchian Channel, or Bollinger Band breakout	High/Low Channel	—
Confirmation Bars	Number of consecutive bars that must close beyond the level to confirm the breakout	1	1 – 10
Buffer (%)	Percentage buffer beyond the range level to reduce false breakouts	0.0	0.0 – 5.0
Direction	Long Only, Short Only, or Both	Both	—

Typical Use Case

Breakout Detection works best on instruments that spend periods consolidating before making directional moves. A 20-bar High/Low Channel breakout on the daily chart is a classic approach for commodity futures and equity indices. Adding a 0.5% buffer and requiring 2 confirmation bars significantly reduces false breakout signals, though it may slightly delay entry.

Entry Rule: Breakout Detection
  Lookback: 20 bars
  Type: High/Low Channel
  Confirmation: 2 bars
  Buffer: 0.5%
  Direction: Both
  Timeframe: Daily

Candlestick Pattern Recognition

Overview

The Candlestick Pattern Recognition rule scans for established candlestick patterns and generates entry signals when they are detected. Arconomy supports both single-bar patterns (such as Hammer, Doji, and Engulfing) and multi-bar patterns (such as Morning Star, Three White Soldiers, and Harami). Patterns are identified using configurable tolerance thresholds to account for varying market conditions.

Key Parameters

Parameter	Description	Default	Range
Pattern	The candlestick pattern to detect (select from a list of 25+ supported patterns)	Engulfing	—
Signal Direction	Bullish patterns only, Bearish patterns only, or Both	Both	—
Body Size Tolerance	Minimum candle body size as a percentage of the average bar range	50%	10% – 100%
Shadow Ratio	Required wick-to-body ratio for patterns that depend on shadow length	2.0	0.5 – 10.0
Confirmation	Require the next bar to close in the pattern's expected direction	Off	—

Typical Use Case

Candlestick patterns are most effective when used at key support and resistance levels. A Bullish Engulfing pattern detected at a known support zone, combined with an RSI showing oversold conditions, creates a high-probability long entry. Enable the Confirmation parameter to wait for a follow-through bar, which reduces false signals at the cost of a slightly later entry.

Volume Spike

Overview

The Volume Spike rule triggers an entry signal when trading volume exceeds a multiple of its recent average. Abnormal volume often precedes or accompanies significant price moves, making it a valuable confirmation tool for other entry signals. This rule can be used on its own for volume-driven strategies or combined with directional entry rules.

Key Parameters

Parameter	Description	Default	Range
Average Period	Number of bars used to calculate the average volume baseline	20	5 – 200
Spike Multiplier	The multiple of average volume that constitutes a spike	2.0	1.1 – 10.0
Direction Filter	Only trigger on volume spikes with a positive price change (Up), negative (Down), or Any	Any	—
Volume Type	Tick Volume or Real Volume (where available)	Tick Volume	—

Typical Use Case

A Volume Spike rule with a 2x multiplier is commonly paired with a Breakout Detection entry rule. When a breakout occurs on above-average volume, it is more likely to be sustained. This combination is particularly effective on equity markets where volume data is reliable and meaningful.

Custom Condition Builder

Overview

The Custom Condition Builder allows you to create entry rules based on any combination of indicator values, price data, and mathematical operations. This rule provides maximum flexibility when the pre-built rules do not cover your specific entry logic. You construct conditions using a visual expression builder that supports arithmetic operators, comparison operators, and logical operators.

Key Parameters

Parameter	Description	Default	Range
Left Operand	The first value in the comparison (indicator value, price, constant, or sub-expression)	—	—
Operator	The comparison: Greater Than, Less Than, Crosses Above, Crosses Below, Equals	Crosses Above	—
Right Operand	The second value in the comparison	—	—
Lookback Offset	Evaluate the condition using data from N bars ago	0	0 – 100

Typical Use Case

The Custom Condition Builder is useful for implementing proprietary entry logic. For example, you could create a condition that enters long when the MACD histogram is positive, the current bar's close is above the VWAP, and the ATR is within a specific range. The expression builder handles the boolean logic so you can focus on the trading idea.

Custom Entry Condition:
  MACD_Histogram(12, 26, 9) > 0
  AND Close > VWAP(Session)
  AND ATR(14) > 0.5
  AND ATR(14) < 2.0

Combining Entry Rules

The real power of Arconomy's entry rules emerges when you combine multiple rules on the canvas. A well-designed entry system typically includes a directional signal (such as a Moving Average Crossover), a confirmation signal (such as a Volume Spike), and a filter (covered in the Filter Rules section) to avoid unfavourable market conditions.

When combining rules, keep these guidelines in mind:

• Fewer is often better. Adding too many entry conditions reduces trade frequency and can lead to over-fitting. Two to three well-chosen rules typically outperform five or six overlapping ones.
• Use diverse signal types. Combining an indicator-based rule with a price-action rule provides more robust signals than combining two indicator-based rules that may be correlated.
• Test each rule independently first. Before combining rules, run a backtest with each rule in isolation to understand its individual characteristics — win rate, average trade duration, and drawdown profile.