Fisher Pattern Detection - Configuration User Guide

Table of Contents

  1. Overview
  2. Pattern Types Explained
  3. Configuration by Trading Style
  4. Configuration by Timeframe
  5. Advanced Tuning Guide
  6. Examples & Best Practices

Overview

Fisher Pattern Detection identifies institutional trading behavior across five key patterns:

  • Accumulation - Smart money building positions quietly
  • Distribution - Selling into retail buying (top formations)
  • Breakout - Strong directional moves with volume confirmation
  • Stop Hunt - Rapid spikes to trigger stop losses, then reversal
  • Absorption - Large orders absorbed with minimal price impact

This guide provides optimized configurations for different trading styles and timeframes.

Pattern Types Explained

1. Accumulation

What it detects: Quiet consolidation with increasing volume - whales building positions

Key characteristics:

  • Low price volatility (tight range)
  • Gradually increasing volume
  • Controlled candles (no panic moves)
  • Multiple volume spikes without price movement

Trading implication: Bullish - anticipate upward breakout

2. Distribution

What it detects: Selling climax - smart money exiting into retail FOMO

Key characteristics:

  • High volatility with large candles
  • Volume declining after initial spike
  • Panic candles and rapid moves
  • Volume peaked earlier (buying climax)

Trading implication: Bearish - anticipate downward move

3. Breakout (Bullish/Bearish)

What it detects: Strong directional move breaking consolidation

Key characteristics:

  • Consolidation phase first (low movement)
  • Explosive move in one direction (>3%)
  • Heavy volume acceleration (>2x)
  • Large candles showing conviction

Trading implication: Follow the breakout direction

4. Stop Hunt

What it detects: Manipulative spike to trigger stops, then quick reversal

Key characteristics:

  • Sudden volatility spike (>2.5x normal)
  • Massive volume surge
  • Large wick candles
  • Price recovers quickly within same block

Trading implication: Trade the reversal direction

5. Absorption

What it detects: Large selling/buying pressure absorbed by whales

Key characteristics:

  • Multiple volume spikes (3+)
  • Massive volume (>1.8x increase)
  • Minimal net price movement (<1.5%)
  • Price holds support/resistance

Trading implication:

  • Support Absorption → Bullish (buyers defending)
  • Resistance Absorption → Bearish (sellers defending)

Configuration by Trading Style

SCALPING (Quick in/out, high frequency)

Timeframes: 1m, 3m, 5m
Goal: Catch quick moves with tight stops

fisher_patterns:
  accumulation:
    movement_a_max: 0.8          # Very tight consolidation
    movement_c_max: 0.6          # Extremely controlled
    volume_accel_c_min: 2.0      # Higher volume requirement
    large_candle_ratio_max: 0.15 # Minimal large candles
    volume_spikes_min: 3         # More confirmation needed
  
  distribution:
    movement_c_min: 1.5          # Lower threshold for faster detection
    volume_accel_c_max: 0.9      # Slightly looser
    large_candle_ratio_min: 0.35 # Catch early distribution
  
  breakout:
    movement_a_max: 1.0          # Tighter consolidation
    movement_c_min: 2.0          # Lower breakout threshold (scalp smaller moves)
    volume_accel_c_min: 2.5      # Higher volume confirmation
    volume_spikes_min: 2
    large_candle_ratio_min: 0.4  # Strong moves only
  
  stop_hunt:
    volatility_multiplier: 3.0   # More aggressive spike detection
    volume_spikes_min: 1
    volume_accel_c_min: 3.0      # Very high volume required
    large_candle_ratio_min: 0.4  # Significant wicks
    recovery_ratio: 0.4          # Quick recovery expected
    block_b_volatility_ratio: 0.5 # Very sudden moves
  
  absorption:
    volume_spikes_min: 4         # More spikes for confirmation
    volume_multiplier: 2.2       # Higher volume requirement
    movement_max: 1.0            # Very tight price action
    volatility_ratio: 0.9
    vwap_ratio: 0.999
    price_ratio: 0.998
    support_movement_threshold: -0.2

DAY TRADING (Intraday swings)

Timeframes: 5m, 15m, 30m
Goal: Balance between frequency and reliability

fisher_patterns:
  accumulation:
    movement_a_max: 1.5          # Standard settings
    movement_c_max: 1.2
    volume_accel_c_min: 1.5
    large_candle_ratio_max: 0.25
    volume_spikes_min: 2
  
  distribution:
    movement_c_min: 2.0
    volume_accel_c_max: 0.85
    large_candle_ratio_min: 0.4
  
  breakout:
    movement_a_max: 2.0
    movement_c_min: 3.0
    volume_accel_c_min: 2.0
    volume_spikes_min: 2
    large_candle_ratio_min: 0.5
  
  stop_hunt:
    volatility_multiplier: 2.5
    volume_spikes_min: 1
    volume_accel_c_min: 2.0
    large_candle_ratio_min: 0.3
    recovery_ratio: 0.5
    block_b_volatility_ratio: 0.6
  
  absorption:
    volume_spikes_min: 3
    volume_multiplier: 1.8
    movement_max: 1.5
    volatility_ratio: 0.8
    vwap_ratio: 0.998
    price_ratio: 0.995
    support_movement_threshold: -0.3

SWING TRADING (Multi-day holds)

Timeframes: 1h, 2h, 4h
Goal: Catch larger moves, filter out noise

fisher_patterns:
  accumulation:
    movement_a_max: 2.5          # Allow more movement (noise filtering)
    movement_c_max: 2.0
    volume_accel_c_min: 1.3      # Lower volume requirement (longer timeframe)
    large_candle_ratio_max: 0.30
    volume_spikes_min: 2
  
  distribution:
    movement_c_min: 3.5          # Higher threshold for significance
    volume_accel_c_max: 0.80
    large_candle_ratio_min: 0.45
  
  breakout:
    movement_a_max: 3.0
    movement_c_min: 5.0          # Larger breakout moves
    volume_accel_c_min: 1.8
    volume_spikes_min: 2
    large_candle_ratio_min: 0.55
  
  stop_hunt:
    volatility_multiplier: 2.0   # Less sensitive (avoid false signals)
    volume_spikes_min: 2
    volume_accel_c_min: 1.8
    large_candle_ratio_min: 0.35
    recovery_ratio: 0.6
    block_b_volatility_ratio: 0.7
  
  absorption:
    volume_spikes_min: 2         # Less strict on higher timeframes
    volume_multiplier: 1.5
    movement_max: 2.5
    volatility_ratio: 0.75
    vwap_ratio: 0.995
    price_ratio: 0.990
    support_movement_threshold: -0.5

POSITION/LONG TRADING (Weeks to months)

Timeframes: 6h, 12h, 1d
Goal: Major trend changes, very high confidence

fisher_patterns:
  accumulation:
    movement_a_max: 4.0          # Very relaxed for daily moves
    movement_c_max: 3.5
    volume_accel_c_min: 1.2
    large_candle_ratio_max: 0.35
    volume_spikes_min: 2
  
  distribution:
    movement_c_min: 5.0          # Only major distribution events
    volume_accel_c_max: 0.75
    large_candle_ratio_min: 0.50
  
  breakout:
    movement_a_max: 4.0
    movement_c_min: 8.0          # Very large breakouts only
    volume_accel_c_min: 1.6
    volume_spikes_min: 2
    large_candle_ratio_min: 0.60
  
  stop_hunt:
    volatility_multiplier: 1.8   # Very conservative
    volume_spikes_min: 2
    volume_accel_c_min: 1.5
    large_candle_ratio_min: 0.40
    recovery_ratio: 0.7
    block_b_volatility_ratio: 0.75
  
  absorption:
    volume_spikes_min: 2
    volume_multiplier: 1.4
    movement_max: 4.0
    volatility_ratio: 0.70
    vwap_ratio: 0.992
    price_ratio: 0.985
    support_movement_threshold: -1.0

Configuration by Timeframe

1-Minute Charts (Scalping, High Frequency)

Characteristics: Very noisy, many false signals
Strategy: Maximum filtering, high volume requirements

fisher_patterns:
  # Use SCALPING config above
  # Key adjustments:
  # - High volume_accel requirements (2.5-3.0x)
  # - Tight movement thresholds (0.6-1.0%)
  # - More volume spikes needed (3-4)

3-5 Minute Charts (Scalping/Fast Day Trading)

Characteristics: Still noisy but some patterns emerge
Strategy: Balanced scalping settings

fisher_patterns:
  # Slightly relaxed from 1m
  accumulation:
    movement_a_max: 1.0
    volume_accel_c_min: 2.0
    volume_spikes_min: 3
  
  breakout:
    movement_c_min: 2.5
    volume_accel_c_min: 2.2

15-Minute Charts (Day Trading Sweet Spot)

Characteristics: Good balance of signal vs noise
Strategy: Standard day trading settings (see DAY TRADING above)

Why 15m is popular:

  • Clear patterns without excessive noise
  • Enough data points for confirmation
  • Good for 2-8 hour holding periods

30-Minute to 1-Hour Charts (Day/Swing Transition)

Characteristics: Reliable patterns, lower frequency
Strategy: Slightly relaxed thresholds

fisher_patterns:
  accumulation:
    movement_a_max: 2.0
    movement_c_max: 1.8
    volume_accel_c_min: 1.4
  
  breakout:
    movement_c_min: 4.0
    volume_accel_c_min: 1.9

2-4 Hour Charts (Swing Trading)

Characteristics: Strong trend signals, minimal noise
Strategy: Use SWING TRADING config (see above)

Best for:

  • Multi-day position holds
  • High win rate setups
  • Reduced screen time

Daily Charts (Position Trading)

Characteristics: Major trends only, very high confidence
Strategy: Use POSITION/LONG TRADING config (see above)

Best for:

  • Long-term investors
  • Major market structure changes
  • Low-frequency trading

Advanced Tuning Guide

If You're Getting Too Many Signals (False Positives)

Tighten these parameters:

  1. Increase volume requirements
    • volume_accel_c_min → +0.5 to +1.0
    • volume_spikes_min → +1
  2. Tighten movement thresholds
    • movement_a_max → -0.3 to -0.5
    • movement_c_min → +0.5 to +1.0
  3. Increase pattern strictness
    • large_candle_ratio_min → +0.1
    • volatility_multiplier → +0.5

If You're Missing Valid Signals (False Negatives)

Relax these parameters:

  1. Lower volume requirements
    • volume_accel_c_min → -0.3 to -0.5
    • volume_spikes_min → -1
  2. Widen movement thresholds
    • movement_a_max → +0.5
    • movement_c_min → -0.5
  3. Reduce pattern strictness
    • large_candle_ratio_min → -0.1
    • absorption_volume_spikes_min → -1

Volatile Markets (High Crypto Volatility)

# Adjust for BTC/ETH during high volatility periods
fisher_patterns:
  accumulation:
    movement_a_max: 2.5          # Allow more "normal" movement
    movement_c_max: 2.0
  
  breakout:
    movement_c_min: 5.0          # Require stronger breakouts
    volume_accel_c_min: 2.5      # Higher volume confirmation
  
  stop_hunt:
    volatility_multiplier: 3.5   # More extreme spikes expected
    recovery_ratio: 0.6

Low Volatility / Ranging Markets

# Adjust for tight ranging conditions
fisher_patterns:
  accumulation:
    movement_a_max: 0.8          # Very tight ranges
    volume_accel_c_min: 2.0      # Focus on volume divergence
  
  breakout:
    movement_c_min: 2.0          # Lower threshold (smaller moves)
    volume_spikes_min: 3         # More confirmation needed
  
  absorption:
    movement_max: 0.8            # Very tight price action
    volume_multiplier: 2.5       # Heavy volume focus

Examples & Best Practices

Example 1: Conservative Day Trader (15m)

Profile: Risk-averse, prefers high win rate over frequency

fisher_patterns:
  accumulation:
    movement_a_max: 1.2          # Tighter than default
    volume_accel_c_min: 2.0      # Higher volume requirement
    volume_spikes_min: 3         # More confirmation
  
  breakout:
    movement_c_min: 4.0          # Larger breakouts only
    volume_accel_c_min: 2.5
    volume_spikes_min: 3
  
  # Focus on high-confidence patterns only
  stop_hunt:
    volume_accel_c_min: 2.5
    volatility_multiplier: 3.0

Example 2: Aggressive Scalper (3m)

Profile: High frequency, accepts lower win rate for more opportunities

fisher_patterns:
  accumulation:
    movement_a_max: 1.5          # More relaxed
    volume_accel_c_min: 1.3      # Lower volume bar
    volume_spikes_min: 2
  
  breakout:
    movement_c_min: 1.8          # Catch smaller moves
    volume_accel_c_min: 1.8
  
  stop_hunt:
    volatility_multiplier: 2.0   # More sensitive
    recovery_ratio: 0.6

Example 3: Swing Trader (4h) - Trend Following

Profile: Holds 3-10 days, focuses on major trend changes

fisher_patterns:
  accumulation:
    movement_a_max: 3.0
    volume_accel_c_min: 1.2      # Volume divergence focus
    volume_spikes_min: 2
  
  breakout:
    movement_c_min: 6.0          # Only major breakouts
    volume_accel_c_min: 1.8
    large_candle_ratio_min: 0.60 # Strong conviction moves
  
  distribution:
    movement_c_min: 4.0          # Major top formations
    large_candle_ratio_min: 0.50
  
  # Less focus on stop hunts (noise on higher TF)
  stop_hunt:
    volatility_multiplier: 2.0
    volume_accel_c_min: 1.8

Best Practices

  1. Start with Defaults
    Use the default configurations for your timeframe, then adjust based on results.
  2. Backtest Your Changes
    Test configuration changes on historical data before live trading.
  3. Market-Specific Tuning
    Different assets have different characteristics:
    • BTC/ETH: Higher volatility → increase thresholds
    • Low-cap altcoins: Extreme volatility → much higher thresholds
    • Stable pairs: Lower volatility → decrease thresholds
  4. Session-Based Adjustments
    Market behavior varies by session:
    • Asian session: Lower volume → relax volume requirements
    • US session: Higher volume → standard or tighter settings
    • Weekends: Thin liquidity → increase thresholds
  5. Combine with Other Indicators
    Fisher patterns work best when combined with:
    • Support/Resistance levels
    • Trend indicators (MA, EMA)
    • RSI/MACD for divergence confirmation
    • Order book depth analysis
  6. Pattern Priority
    Not all patterns are equal. Suggested priority:
    1. Accumulation - Highest win rate (60-70%)
    2. Stop Hunt - Good risk/reward (55-65%)
    3. Breakout - Momentum plays (50-60%)
    4. Absorption - Context-dependent (50-60%)
    5. Distribution - Hardest to time (45-55%)
  7. Time-of-Day Filtering
    Consider disabling/adjusting during:
    • Major news events (extreme volatility)
    • Market opens/closes (manipulation common)
    • Low liquidity periods (wider spreads)

Quick Reference Table

Trading Style Best Timeframes Key Settings Expected Signals/Day
Scalping 1m, 3m, 5m Tight thresholds, high volume 10-30
Day Trading 15m, 30m Balanced settings 3-10
Swing Trading 1h, 2h, 4h Relaxed, filter noise 1-3
Position Trading 6h, 12h, 1d Very relaxed, major moves only 0-1

Configuration Template

Copy and customize this template:

# Fisher Pattern Detection Configuration
# Trading Style: [SCALPING/DAY/SWING/POSITION]
# Primary Timeframe: [1m/15m/1h/1d]
# Risk Profile: [CONSERVATIVE/BALANCED/AGGRESSIVE]

fisher_patterns:
  accumulation:
    movement_a_max: 1.5
    movement_c_max: 1.2
    volume_accel_c_min: 1.5
    large_candle_ratio_max: 0.25
    volume_spikes_min: 2
  
  distribution:
    movement_c_min: 2.0
    volume_accel_c_max: 0.85
    large_candle_ratio_min: 0.4
  
  breakout:
    movement_a_max: 2.0
    movement_c_min: 3.0
    volume_accel_c_min: 2.0
    volume_spikes_min: 2
    large_candle_ratio_min: 0.5
  
  stop_hunt:
    volatility_multiplier: 2.5
    volume_spikes_min: 1
    volume_accel_c_min: 2.0
    large_candle_ratio_min: 0.3
    recovery_ratio: 0.5
    block_b_volatility_ratio: 0.6
  
  absorption:
    volume_spikes_min: 3
    volume_multiplier: 1.8
    movement_max: 1.5
    volatility_ratio: 0.8
    vwap_ratio: 0.998
    price_ratio: 0.995
    support_movement_threshold: -0.3

📎 Related Topics