Comments for https://ctrader.com/products/2401

🛡️ Risk Management Playbook for Trend Cycle
Since Trend Cycle combines directional trend detection (HMA) with Time Statistics (Duration analysis), your risk management should be based on both Price and Time.

1. Stop Loss Placement (Price Risk)
   The HMA is a tight-tracking moving average. Use it as your dynamic trailing stop.

Initial Stop Loss: Place your SL just below the recent Swing Low (for Buys) or above the Swing High (for Sells) when the signal appears. Do not place it exactly on the HMA line, as price often retests the line before expanding.

The "Flip" Exit: The most objective risk control is to close the trade immediately if the Trend Color changes (e.g., Green turns to Orange). This indicates the momentum has statistically shifted.

1. Time-Based Risk (The "Cycle" Logic)
   This is the unique advantage of this indicator. It calculates the Average Trend Duration (e.g., "Bull avg: 12 bars"). Use this to gauge probability:

Green Zone (Low Risk): If the current trend duration (Real Len) is less than 50% of the average duration, the trend is young. You can hold with standard risk.

Red Zone (High Risk): As soon as Real Len exceeds the Avg Len, the statistical probability of a reversal increases drastically.

Action: When Real Len > Avg Len, tighten your Stop Loss or take partial profits. Don't be greedy with "old" trends.

1. Filtering False Signals (Whipsaws)
   HMA is very reactive and can generate false signals in sideways (ranging) markets.

Wait for the Close: Never enter a trade while the candle is still moving. The HMA color is only confirmed when the bar closes.

Use the "Trend Sensitivity" Parameter: If you find you are getting stopped out too frequently by small color flips, increase the Trend Sensitivity parameter from 3 to 5. This forces the indicator to wait for more consistent movement before signaling a change.

1. Position Sizing
   Volatility Adjustment: Since the HMA reacts fast, your Stop Loss might be tight. Ensure you calculate your lot size so that the distance to your SL represents no more than 1-2% of your account equity.

Scale Out: Use the Forecast Line (the gray horizontal line drawn on the chart) as a target. When price reaches this time projection, scale out 50% of your position.
For a detailed analysis of performance and optimized setfiles for each condition, we invite you to visit our Discord: https://discord.gg/VcsszWc6z7