Construct a second-pullback entry after a moving-average crossover

Separate the regime change from the order

The archive workflow starts with a moving-average-crossover and withholds the order. When the shorter average crosses the longer average, the procedure only assigns a trend state and resets the flags. Editorial reading: treat that event as a regime change, not as a rule-based-entry.

The later stage waits for a pullback on the spread-stochastic. Only after that second condition can a rule-based-entry become eligible, and the exits are written in the same procedure.

Build the average-spread and the spread-stochastic

A momentum series, the average-spread, can be formed as the difference between a shorter moving average and a longer moving average of close.

That difference series is converted with a stochastic oscillator by placing the current value between the lowest and highest values of the same series over a lookback, then averaging the resulting ratio over three bars. The result is the spread-stochastic: a bounded map of the average-spread.

The illustrated construction uses a 10-bar shorter average, a 40-bar longer average, and a 5-bar lookback for the stochastic oscillator of the average-spread.

Reset the flags at each crossover

When the shorter average crosses above the longer average, the procedure sets an uptrend state, turns first-cross-state on, and turns second-cross-state off.

When the shorter average crosses below the longer average, the procedure sets a downtrend state and applies the same first-cross-state on and second-cross-state off reset.

Arm the pullback only after a midpoint recross

While first-cross-state is on, a later crossing of the spread-stochastic through 50 in the direction of the new trend turns first-cross-state off and second-cross-state on. Until that recross, a rule-based-entry stays ineligible.

Fire a rule-based-entry at the matching extreme

Once second-cross-state is on, a long rule-based-entry is eligible only if the trend state is up and the spread-stochastic is below a lower threshold illustrated as 10.

Once second-cross-state is on, a short rule-based-entry is eligible only if the trend state is down and the spread-stochastic is above an upper threshold illustrated as 90.

Close with the same pair of exit rules

An open long is closed by a trend-reversal-exit if the moving-average trend state turns down, or by a mid-band-target-exit if the spread-stochastic rises through an interior target illustrated as 50 while the uptrend remains in force.

The short side uses the opposite pair of rules. Editorial reading: close a short on a trend-reversal-exit when the trend state turns up, or on a mid-band-target-exit when the spread-stochastic falls through that interior target while the downtrend remains in force.