Range Trading and SMT Divergence

Detect a range first, then use cross-market divergence only as contextual confirmation.

Range is a market regime

A range can be represented by the end of an impulse and the end of the following correction, producing upper and lower boundaries plus a midpoint. Boundary excursions should not automatically be classified as breakouts; they can be tagged as deviations until acceptance outside the range is confirmed.

Why this matters for bots

A trend strategy and a range strategy should not share the same entry permissions. A regime detector can suppress trend continuation entries while price repeatedly rotates around the midpoint and both boundaries remain active.

SMT as cross-market disagreement

The material compares instruments with a shared USD component and the dollar index. The automation-safe interpretation is relative structural disagreement: one related market takes a comparable extreme while another fails to confirm it. That can become a secondary feature, never proof of reversal by itself.

if regime == RANGE and boundary_swept:
    if related_market_divergence and local_shift:
        setup_score += SMT_CONFIRMATION
    else:
        wait()

Educational engineering material. These are testable market models and implementation ideas, not investment advice or guarantees of performance.