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What trade direction means

Trade direction defines how a strategy participates in the market. Every strategy can:
  • trade long only
  • trade short only
  • trade both long and short
Direction is not a preference - it is a structural decision that affects entries, exits, and risk.

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Long trades

A long trade profits when price increases. Typical long logic:
  • buy strength
  • buy pullbacks
  • buy breakouts
Example: 
Go long when EMA(20) crosses above EMA(50).
Long trades are commonly used in:
  • bullish markets
  • trend-following systems
  • momentum strategies

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Short trades

A short trade profits when price decreases. Typical short logic:
  • sell weakness
  • fade overbought conditions
  • trade breakdowns
Example: 
Go short when RSI(14) crosses below 40.
Short trades are structurally symmetric to long trades, but behavior is often asymmetric.
Short trades usually move faster and can be riskier.

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Using both directions in one strategy

A single strategy may include both long and short logic. Example: 
Trade BTC/USDT on 1h.
Go long when EMA(20) crosses above EMA(50).
Go short when EMA(20) crosses below EMA(50).
In this case:
  • long and short entries are evaluated independently
  • each direction has its own lifecycle
  • exits may be shared or direction-specific

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Shared vs direction-specific exits

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Shared exits

Use a 5% take profit and 1% stop loss.
Applies to both long and short trades.

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Direction-specific exits

For long trades use a 6% TP and 1% SL.
For short trades use a 4% TP and 1.5% SL.
Direction-specific exits allow asymmetric behavior.

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Direction filters

You may explicitly restrict direction: Examples:
  • long-only strategies
  • disabling shorts in bullish regimes
  • disabling longs in bearish regimes
Only allow long trades.
Or conditionally: 
Allow shorts only when the higher timeframe trend is bearish.

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Default behavior

If direction is:
  • explicitly stated → ATI follows it exactly
  • implied but clear → ATI may infer direction
  • ambiguous → ATI will ask for clarification

What Trinigence fills automatically

See how direction assumptions are handled.

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Common mistakes

Market behavior is often asymmetric. What works long may fail short.
Each direction must be fully defined to be valid.
Shorts often experience sharper moves and faster stop-outs.

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Best practices

  • Start with one direction
  • Validate behavior before adding the second
  • Consider asymmetric risk rules
  • Inspect long and short trades separately

Entry logic

Learn how entries are evaluated per direction.

Entry logic

How trades are opened.

Exit logic

How trades are closed.

Risk management

Direction-aware risk control.

Strategy structure overview

Return to the big picture.
Direction defines bias.
Risk defines survival.