Exhaustion + Band — fading the giant candle
Discovered in round 10 of our studies: an entry orthogonal to Double Reversal that survived out-of-sample on both JPY pairs.
The rule: hunt the "giant" candle
Exhaustion + Band trades the exhaustion of an explosive move. It enters when, on the same candle:
- The candle range is ≥ 2× the previous ATR(14) — a giant candle vs the recent norm;
- The body is ≥ 60% of the range — directional move, not a wick;
- The candle closes OUTSIDE the Bollinger band — the final overshoot.
Giant down candle closing below the band → CALL (fade). Giant up candle above the band → PUT. The logic: a move 2x bigger than normal that still closes outside the band tends to be a climax — everyone who had to enter already has.
The numbers
| Pair | Overall | Test | FRESH (out-of-sample) |
|---|---|---|---|
| USD/JPY | 60.8% | 60.0% | 56.6% (n=488) ✅ |
| GBP/JPY | 57.6% | — | 58.5% (n=340) ✅ |
Bonus finding: with a 2-candle expiry the same entry rises to 60.8% test / 58.7% fresh — the fade needs a bit more time to complete. We tested "looser" variants (exa25, exa_solto, RSI confirmation): none improved — the edge lives in the exhaustion+band COMBINATION, not in loosening parameters.
The perfect partner for Double Reversal
Most valuable of all: Exhaustion+Band is orthogonal to Double Reversal — it fires on different candles (candle anatomy vs distance from mean). Running both in individual mode (union) doubles the signal count at the same accuracy: 59.9% overall, 58.4% fresh (n=1,597 and 498). It's the champion config our bot ships with.
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FAQ
Does it work on OTC? No — like everything: OTC is ~50% for all strategies.
What about pin bars / long wicks? Tested: 47–49% on M1 (a wick there means continuation, not reversal). Even inverted it went nowhere.
Where do I enable it? In the panel: estrategias = reversao_dupla,exaustao_bb, 120s expiry, USDJPY+GBPJPY, 9–10:59am / 6–11:59pm UTC-3 windows.
⚠️ Binary options carry a high risk of losing all your capital. Educational content based on demo-account data — not investment advice. Past results do not guarantee future results. No bot or strategy guarantees profit.