Entry Rules

In Arconomy, entering a trade means configuring the right combination of indicator rules to detect your desired market conditions, then connecting them to a trade execution rule that places the order. This page explains the trade execution rules available for entering positions, and how to use Arconomy's indicator and pattern rules to build common entry strategies.

Placing Trades

Arconomy provides two rules for placing trades, each designed for different use cases:

Place Trade with Risk

The Place Trade with Risk rule places a trade with a built-in stop loss. You configure the stop loss based on an amount, price or pips, and the rule automatically calculates the position size from your risk parameters. This is the recommended rule for most entry strategies because it combines trade execution and risk management in a single step — ensuring every trade has a stop loss from the moment it is placed.

Typical use cases for Place Trade with Risk include:

• Strategies where every trade must have a defined risk from entry
• Percentage-risk position sizing — the rule calculates the quantity based on your risk amount and stop distance
• Strategies that require a fixed stop loss on every trade without needing a separate Stop Loss rule

Place Trades

The Place Trades rule places one or more trades with a fixed or dynamic quantity. Unlike Place Trade with Risk, this rule does not include a built-in stop loss — you manage risk separately using Stop Loss or Aggregate Stop Loss rules connected on the canvas.

The Place Trades rule also allows scaling into a position and dynamically adjusting the quantity. This makes it well suited for:

• Strategies that build positions over time (e.g. adding to a position as the trend develops)
• Fixed lot sizing — using the same quantity on every trade regardless of account size
• Strategies where the quantity is calculated by another rule and fed in as a dynamic input
• Placing multiple trades at once with different configurations

Detecting Entry Conditions

Arconomy's indicator rules calculate technical values from market data and produce output that can be compared using the Compare Values rule to detect specific conditions. By connecting indicator rules together with execution dependencies and condition logic, you can build virtually any entry strategy. Below are some common approaches.

Trend Following

Trend-following strategies aim to enter in the direction of the prevailing trend. In Arconomy, you can detect trend conditions by combining indicator rules such as:

• Moving Average — calculate a moving average (SMA, EMA, WMA, etc.) and use Compare Values to detect when a fast MA crosses above a slow MA, or when price crosses above a MA
• MACD — detect signal line crossovers or histogram direction changes that indicate trend momentum shifts
• RSI — use the RSI value to confirm trend strength (e.g. RSI above 50 for bullish momentum)

For example, a simple moving average crossover entry can be built with two Moving Average rules (one fast, one slow) connected to a Compare Values rule that triggers when the fast MA crosses above the slow MA. The Compare Values rule's execution then triggers a Place Trade with Risk rule to enter the position.

Mean Reversion

Mean-reversion strategies enter positions when price deviates significantly from an average, expecting it to revert. Useful indicator rules include:

• RSI — detect oversold or overbought conditions (e.g. RSI below 30 for a long entry, expecting price to revert upward)
• Bollinger Band — detect when price touches or crosses outside the upper or lower bands, indicating an extended move that may reverse
• Keltner Channel — similar to Bollinger Bands but based on ATR, providing volatility-adjusted overbought and oversold levels

A typical mean-reversion setup might use an RSI rule to detect when RSI drops below 30, combined with a Bollinger Band rule to confirm that price is at or below the lower band. When both conditions are met, the strategy triggers a long entry.

Breakout

Breakout strategies enter when price moves beyond a defined range, signalling the beginning of a potential new trend. Arconomy provides several rules that can detect breakout conditions:

• Donchian Channel — calculates the highest high and lowest low over a lookback period, triggering when price breaks above the upper channel or below the lower channel
• Highest Price / Lowest Price — track the highest or lowest price over a configurable period, useful for detecting new highs or lows
• Price Level — set a specific price range and detect when price moves above or below the range
• Bollinger Band — detect when price breaks through the upper or lower band with expanding bandwidth, indicating a volatility breakout

For example, a Donchian Channel breakout entry can be built by connecting a Donchian Channel rule to a Compare Values rule that detects when the current price exceeds the upper channel value. The ATR rule can be added as a filter to confirm that volatility is expanding, reducing false breakout signals.

Candlestick Patterns

The Candle Pattern rule detects established candlestick patterns from price data and can be used to trigger entries based on technical chart patterns. This includes both single-bar patterns (such as Hammer, Doji and Engulfing) and multi-bar formations (such as Morning Star and Three White Soldiers).

Candlestick patterns are most effective when combined with other indicator rules to provide context. For example, detecting a Bullish Engulfing pattern is more meaningful when it occurs at a support level identified by a Moving Average or at the lower Bollinger Band. You can set up these conditions using execution dependencies — the Candle Pattern rule executes after the indicator rules have updated, and a Compare Values condition confirms the pattern occurred in the right context before triggering the trade.

Building Entry Logic

The power of Arconomy's approach is that entry logic is built by connecting standard rules together on the canvas rather than relying on pre-built entry strategies. This gives you complete flexibility to combine any indicators, patterns and conditions in whatever way your strategy requires.

A typical entry flow on the canvas looks like:

1. Price Data rule provides market data
2. One or more indicator rules (Moving Average, RSI, Bollinger Band, etc.) calculate their values
3. Logic Count rules detect the specific conditions you are looking for and how many conditions should be met
4. A Place Trade with Risk or Place Trades rule places the trade or trades when the required number of conditions are met

Each rule's execution is controlled by execution dependencies, so you have full control over the order of operations and the conditions that must be satisfied before a trade is placed. See the Available Rules page for the complete list of indicator and utility rules you can use to build your entry logic.

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.