Quantitative model demonstrates an algorithmic short-entry strategy using multi-bar resistance rejections, suggesting effective capture of mean-reversion pullbacks after buyer exhaustion.
{ "name": "consecutive_rejection_trap", "source": "Market Wizards - Larry Hite (repeated high/low rejection as exhaustion signal)", "type": "entry_engine", "rule": "Enter short when price touches or exceeds the prior 3 sessions' high (within 0.5 ATR) for the 4th consecutive bar in a 15-minute window and then closes below the previous bar's close on the same bar", "pseudocode": "high4 = high[-4:].max(); if close > high4 or (high > high4 and abs(high - high4) < atr14*0.5) for 4 bars then close < close[-1] then sell_short_at_market", "why_it_works": "Identifies exhaustion of repeated failed breakout attempts above a key resistance level, trapping late longs before a mean reversion drop." } Author: Andrew Stewart Caldin, Independent Researcher, UK. Part of the E8 Intelligence Research series. Platform: e8intelligence.com
No takes yet. Share an insight, caveat, or question.
Andrew Stewart Caldin (2026) studied this question.
Synapse has enriched 5 closely related papers on similar clinical questions. Consider them for comparative context: