SHEL Supertrend Strategy

Supertrend is an ATR-based trend indicator. It creates bands above/below price using ATR. When price closes beyond a band, it 'flips' to indicate trend change. The line then acts as trailing stop, only moving in the trend direction.

ATR period 10 and Multiplier 3.0 is recommended for Shell. This balances responsiveness with noise filtering for Shell's moderate volatility. Adjust to 3.5 in high volatility, 2.5 in low volatility.

Wait for Supertrend flip to confirm (bar must close). Bullish flip = long entry on next bar open. Bearish flip = short entry (or exit long). Stop at Supertrend level + small buffer.

Primary exit is opposite flip. For long position, exit when bearish flip occurs (price closes below Supertrend). Also use 20-day time stop and consider partial profits at 2× ATR.

Whipsaws occur in ranging markets (low ADX). Use ADX > 25 filter to avoid ranging conditions. Also check oil direction - Shell ranges when oil consolidates.

ADX measures trend strength. Require ADX > 25 for valid flip signals. When ADX < 20, market is ranging and flips will whipsaw. ADX filter significantly improves win rate.

Shell is world's largest LNG trader. Oil alone misses LNG-driven moves. Check Brent Supertrend AND LNG trend. Both confirming = full size. Mixed = half size. Shell can outperform on LNG strength.

Weekly Supertrend sets major bias. Only take daily flips aligned with weekly. Daily bullish flip + Weekly bullish = high probability. Counter-weekly flips have lower success rate.

Check ATR vs its average. High volatility (ATR > 125% of average) = use 3.5 multiplier. Low volatility (ATR < 75%) = use 2.5 multiplier. Adapts bands to current conditions.

If price consolidates but doesn't flip, stay in trade. Supertrend continues trailing. Shell often consolidates then continues trend. Only exit on actual flip or time stop.

Calculate TR, ATR, HL2, Upper/Lower bands. Track trend direction (1=bullish, -1=bearish). Ratchet Supertrend (Max for bullish, Min for bearish). Detect flip = trend change. Add ADX and energy filters.

Buy calls on bullish flip, puts on bearish for defined risk. Use 30-45 DTE (typical Supertrend hold is 2-4 weeks). Spreads reduce cost. Exit options on opposite flip.

Test ATR 7-14, Multiplier 2-4 with walk-forward testing. Robust parameters perform similarly to nearby values. 10/3 is standard and robust. Avoid curve-fitting.

ADX > 30: full trading, standard parameters. ADX 20-30: moderate, standard. ADX < 20: skip flips (ranging). Transitioning: half size, tight time stops. Shell follows energy regime.

Per-trade: 1.5% risk. Total Shell: max 5%. Total energy: max 10%. Max concurrent Supertrend: 3 across portfolio. Track by regime and energy filter for attribution.