Really would like to discuss my potential strategy with some like minded people.
I have been flipping between strategies for a while but in the last 6 months I have been working on combining things that I think will work for me, I think I have what I want and wanted to discuss with others.
So its a swing trading strategy on the 4h.
It looks to get in on pullbacks and the same fib level each time.
The SL & TP will be at the same fib levels each time.
The trade will be taken in the direction of the trend and will use 4h market structure, the 1D and 1W charts to determine this.
To backtest this I have created a spreadsheet which records the maximum retracement level, the max fib extension level and the maximum fib extension level at the point at which the 1D Heikin Ashi candle changes color.
With this data I have added global settings for each potential trade which states the account size, risk per trade, the fib stop level, the fib take profit level and the fib entry level.
By changing the global settings I can see what effect this would have on the overall outcome and find something which has a good balance of win rate vs RR vs % return as well as potential drawdown.
The best balance of settings I have found have a fixed limit order entry at the 0.618, a SL on the 0.85 and a TP at the previous swing high/low/ 0.0 fib level.
Using these settings I get a 57% win rate, a 1:2.9 R/R and haven’t experience a drawdown of more than 3.6%.
I have tested 9 pairs. Some have data for 6 months and some for all of 2024. The return is sitting at 158%.
Rather than using a fixed TP, if I use the Heikin Ashi take profit method of closing a trade when the first daily candle closes in a different colour, I get a 292% return.
Obviously it would be a struggle to get every trade, things would be slightly different live and I am adding more data to try and get a full year of on each pair I want to trade. However to me it looks like a solid rules based strategy that would use the same entry, SL & TP each time using limit orders - meaning it should be a relatively easy strategy to implement.
If anyone has any thoughts on what I have done, advice, thinks im crazy!! I would love to hear back. Thanks
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