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Backtesting JJ Simon's NQ Strategy | Fair Value Theory — Transcript

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0:00I'm honestly going to say, like, this JJ
0:01guy might be legit. I hope he doesn't
0:04come out like in a week on JJ's a fraud.
0:06But, we put his strategy to the test
0:08with no bias, no, um, expectations.
0:11Definitely a promising strategy that if
0:13you love 1-minute timeframe NQ scalping,
0:16um, could be a strategy for you.
0:22New guy in town that's, uh, one of my
0:23trading friends shared with me, uh, JJ
0:25Simon, somebody you've probably never
0:27heard of before. He just started his
0:29YouTube channel like a couple of weeks
0:30ago, but pretty bold claims, uh, $1.2
0:33million in payouts that he's claimed
0:35he's made over the last, um, 12-13
0:37months or so. Obviously, you know, it's
0:39not fully verified on our end. I think
0:41he has done a decent job so far of
0:42showing like live logins. He showed like
0:44a bunch of different bank accounts and
0:46different things like that. I hope he
0:47continues to show proof of the like
0:50actual live logins and not, you know,
0:52anything that can be edited or anything
0:53like that, but, um, but yeah, he claims
0:55to have made tons of payouts from all
0:57kinds of different futures prop firms,
0:58Topstep, uh, E8, Funded Next was, um,
1:01that what that video he just recently
1:03shared. And he trades a NQ, uh, 1-minute
1:06scalping strategy. Uh, this guy's like
1:0720 years old. I think he, uh, he said he
1:10studied quantitative finance in, uh, in
1:12in college and he's tried to, uh, apply
1:14some of the things he's learned from
1:16college to his trading. So, what is his
1:19his strategy? I'll kind of break it
1:20down, um, as usual, and I've got a
1:22strategy PDF PDF for you guys that I
1:24shared in the chats, um, as well as, um,
1:27if you guys are watching the recording,
1:29you guys can always, um, access this
1:31from the link below. But, uh, yeah, I'm
1:33going to go over his strategy.
1:34I obviously, like, you know, for most of
1:36these strategies we'll try to identify
1:38like if there's a couple little tweaks
1:40we can do to make it a little more
1:41mechanical so that it's easier for you
1:42guys to more consistently identify and
1:44execute it. Um, you know, I'll I'll, you
1:46know, mention a few things like that.
1:48But, very high level, uh, before we get
1:49into it, you know, just looking at his
1:51chart visually, um, fair value theory is
1:53his general strategy and he's identified
1:55a few points in time where you can kind
1:57of trade a early continuation away from
1:59that price and expect to, you know, more
2:01often than not mean revert back to that
2:03price. And these references price can
2:05often be like New York open at 9:30. Uh,
2:09he also trades like a 2:00 p.m. like
2:10kind of afternoon open, which is
2:12interesting. Um, he also trades Asia
2:14session, um, the open of Asia session.
2:16And I think he's, uh, based in the US,
2:18so he doesn't trade London. But, there's
2:19several, uh, you know, periods you can
2:21test. That's like that the basis of the
2:22strategy and we'll get into like the
2:24actual specifics of it in a second. So,
2:27what is fair value theory? Let's, uh,
2:28break down a couple educational
2:29components first. Um, many of you should
2:32be familiar with what is a market
2:33structure break, um, or a break in
2:35structure, um, but a couple
2:36demonstrations. So, market structure
2:38break is really if price is in a
2:39downtrend and you see a close above a
2:42previous, uh, kind of wick high. That's
2:44a bullish market structure break. It
2:46indicates a potential reversal in the
2:47trend. Um, you might also hear a break
2:51in structure, BOS, which is more of like
2:52a trend continuation. So, like, whereas
2:54this is a market structure break to the
2:56upside, a break in structure would be
2:57like the close below this low right
2:59here, or we're continuing to the
3:00downside, or a close below this low
3:02here, we're continuing to the downside.
3:03So, breaks in structures and market
3:05structure breaks we use pretty
3:06interchangeably, but all you all you got
3:08to know is it's a kind of break of a
3:10previous level with a close, not just a
3:12wick past it.
3:14Um, and so, uh, yeah, we'll get to you
3:16all your comments in a second. Um, we'll
3:18see if the strategy holds up. Obviously,
3:20with most of these videos, uh,
3:21especially these claims, like it's a
3:22pretty bold claim. Uh, at the end of the
3:24day, it's really important to validate
3:25any of these strategies and see if it's
3:27actually legit instead of just trusting
3:29what everybody says, so that's exactly
3:31what we're going to do today and see if
3:32it's, um, actually profitable or, you
3:34know, has promise or not. Um, the next
3:36thing is like, uh, this concept of a
3:37displacement candle. And in his, um,
3:40kind of video, he talks about it being
3:42like a large candle and kind of like a
3:43decisive candle. Um, how decisive a
3:46candle closes is something you can't
3:48actually make a very mechanical
3:49definition around. So, we can use this
3:51like counter wick definition where
3:53basically for a bullish candle that top
3:54wick, if you measure from like the open
3:56to that kind of the high, how much of
3:58that, um, kind of range does the wick
4:01make up? And like a decisive close you
4:03could say, "Okay, I don't want that
4:04counter wick to be more than 20% of that
4:06range." That can indicate that that's a
4:08really strong close. You're not seeing
4:09much of a counter wick at all. Um, the
4:11size of the candle is a little more
4:13discretionary. That's something that's a
4:14little harder to make a mechanical rule
4:16set around. So, for my testing
4:18specifically, I've tried to focus mostly
4:20on like the decisiveness of the candle.
4:22Um, obviously, if you tried to figure
4:24out a way to incorporate size, too, that
4:27could work. But, just to you show you
4:28visually, like, this green candle right
4:29here, this is a very decisive candle,
4:31but it's not very strong. Uh, or sorry,
4:33it's not very large. Like, it's
4:34relatively small compared to these. This
4:36one right here is kind of the best where
4:38it's both decisive and large relative to
4:40kind of the previous candles. But,
4:42again, that's a little discretionary,
4:43hard to,
4:44you know, make a rule around what large
4:46is or not. Um, same here. We have a a
4:49fairly large candle, um, that also
4:51closes decisively. So, these are kind of
4:52displacement candle definitions and then
4:54vice versa for shorts. Um,
4:56this candle right here is a good example
4:58of a non, um, decisive candle where
5:00there was actually a pretty big counter
5:01wick, more than 20%. So, this would like
5:04not meet our criteria mechanical
5:05criteria for like a decisive candle, um,
5:08closing in our direction. Whereas this
5:10one right here, um, did have a small
5:12counter wick. Same thing. This candle,
5:14this candle, like, very small counter
5:15wicks that are less than 20% and again,
5:18I kind of have some commentary about,
5:19you know, this is a pretty big size,
5:20this is a relatively small size, but
5:21it's it's discretionary enough that I
5:23think it's better it's going to be
5:24better to focus on the decisiveness
5:26versus the size, um, when testing.
5:29Um, so, few strategy details and then
5:32yeah, I'll get to you guys' questions.
5:33If you guys have questions at any
5:34points, uh, feel free to, um, ask. I'll,
5:37you know, adjust everything I can.
5:38Um, but,
5:40we'll talk about the general parameters.
5:41Obviously, this is NQ 1-minute
5:43timeframe. He's 20 years old. He's
5:44probably really good at first-person
5:45shooters, would be my guess. And he's
5:47trading 1-minute NQ timeframe, NQ
5:50futures. Um, so, this is obviously a
5:51futures specific strategy. Um, he trades
5:54basically the market open, uh, through
5:56about 11 to about 90 minutes after New
5:58York open. And then for the the kind of
6:00afternoon window, he'll start straight
6:02charting at around 2:00 p.m. He didn't
6:04he didn't specifically say how long he
6:05trades. From my testing, I think it's
6:07probably best to cut off around 3:00 if
6:09you're trading that afternoon window.
6:11And then again, you could also test the
6:12first 90 minutes of Asia session, London
6:15open. Um, you could also test other
6:16assets to see if the same price theory
6:18works on others, but he specifically
6:20trades NQ, um, during a New York open,
6:23New York p.m. And I think he does
6:25sometimes trade Asia Asia. We'll talk a
6:26little bit more that, uh, a little bit
6:28later. So, again, fair value theory,
6:30like I mentioned, um, his the whole
6:32concept is if there's no new information
6:34for the market to price in, it's most
6:36likely like kind of already decided
6:37what's fair value and, uh, it's price is
6:40going to kind of like mean revert back
6:41to that price. And he's found that the
6:439:30 open and the 2:00 p.m. New York
6:45afternoon often act as fair value for
6:47that.
6:48Um, in terms of timing,
6:49he generally looks for continuations
6:51kind of away from the fair value the
6:52first 10-15 minutes, um, after the open
6:55and then look for mean reversions, uh,
6:56back to that fair value the rest of the
6:58trade window.
6:59In terms of the entry model, it's pretty
7:01sim- simple, um, not too complex.
7:03Obviously, it's 1-minute timeframe, so
7:04it's fast, but overall, it's it's pretty
7:06simple. So, um, he says in his video he
7:09does he will trade, um, displacements
7:12only where like you're you only have
7:14that displacement candle, um, but he
7:16said the best combination is when it's
7:18displacement plus a break in structure.
7:20Um, so, I don't know if there's a great
7:22example for the if you're upside here.
7:23But, you can see the difference between
7:24these candles. We have, uh, kind of
7:26displacement that breaks structure here.
7:28The second example is just the
7:30displacement candle, no real structure
7:31break. And the second one that worked
7:33had a displacement plus break. So, I
7:35decided to stick with the best. Okay?
7:37So, we're going to use the break the,
7:39uh, break of structure and decisive
7:41candle for our kind of entry criteria,
7:43either for the continu- continuation
7:45away from the fair value price or coming
7:48back to it, the market structure break
7:49after the fact. Um, and so, you can see
7:51kind of bullish and bearish examples
7:53right here.
7:54Um,
7:56and then, yeah, somebody said they
7:58thought it was the 9:29 candle. It's
7:59basically market open. So, like, what
8:01what price, um, opens, um, at, uh, when
8:05you, you know, see the price. And he he
8:07usually hides it highlights like the
8:08first candle. Um, so, it's basically
8:10that the what price opens, um, kind of
8:12at market open.
8:13And then, um, in terms of the stop loss
8:16distance, this is another thing that,
8:18um,
8:18he didn't he he says he basically uses
8:20like most often a 25 tick stop loss and
8:23like a 38.5, um, tick tick profit for
8:251.5 R. Um, but he did mention there's
8:28like more of maybe if it's more
8:29volatile, then he'll do like a 50 tick
8:31stop loss and 75 ticks. So, to give you
8:33guys like a very mechanical way to
8:35adjust your stop loss distance based on
8:37how volatile price is, you can use the
8:40average true range indicator, which is
8:42kind of a a volatility indicator,
8:43essentially. And, um, use that the level
8:46of the ATR to determine like how big of
8:49size your stop loss should be. So, if
8:51it's over 20, like, price is really
8:52moving, um, 50 tick stop loss is going
8:54to be a good, um, stop loss distance.
8:56And obviously, 1.5 R would be 75.
8:597 to 20 was kind of the range that I
9:01was, uh, testing and playing around
9:03with. Seems like a pretty good range,
9:04um, that happens in most of the time for
9:06that 25 tick stop loss, um, in the 38
9:09and 1/2 tick tick profit. And then if
9:11it's below 7 ATR, this is most often in
9:14the New York p.m. session or probably
9:15Asia session sometimes, too, if you're
9:17trading that. Um, it's probably better
9:18to tighten it up a little further and
9:20use like a 16 and 1/2 versus 24.75. And
9:22you might be wondering like where these
9:23numbers come from. And, um, the
9:25interesting way he obviously trades prop
9:27firms, uh, futures prop firms, and
9:29these, um, distances are specifically
9:31designed so that if you have, um,
9:34a, let's look at this first example. If
9:36you have a pretty wide stop loss with 50
9:38ticks, one contract on NQ is going to
9:40equate to a $1,000 risk per trade.
9:42So, the these levels are almost like
9:44designed to work specifically with NQ
9:46contract amounts.
9:48So, one contract with a 50 tick stop
9:51loss equates to $1,000 risk per trade.
9:53Two contracts with a 25 tick equates to
9:55$1,000 risk per trade, or three
9:57contracts with a 16.5 tick stop loss.
10:001,000. So, like it's very easy to
10:02adjust the quantity based on the stop
10:04loss levels.
10:06A few other rules we definitely need to
10:07go over and then we'll look at a few
10:08specific examples.
10:10From my testing so far, and this is
10:12something you could validate as well, it
10:13may be best to avoid the first three
10:15minutes after the 9:30 open.
10:18A lot of people get pretty scared
10:20trading market open anyways,
10:22but it may actually not be worth trading
10:24those first three minutes
10:26if you're getting chopped up too often
10:27and it's causing like too many losses.
10:29Something you can test and validate
10:30yourself, but from my testing so far
10:31that seems like it may be best to wait
10:33like the first three minutes before
10:35taking these continuations.
10:37Um,
10:38he didn't mention it specifically in his
10:39video, but looking at some some other
10:41examples that I found, he often will
10:42have like the VWAP on his chart as well,
10:44so that could potentially be another
10:45confluence to test and maybe find out
10:48how he uses that to as a potential
10:50confluence or not. I [snorts] didn't
10:52personally test Asia session. I just
10:54focused on New York session for my
10:55testing so far, but if you're going to
10:57trade Asia, he says he really only likes
10:59to trade it if there's like a surge in
11:00volume and volatility. Otherwise, he
11:02doesn't like to trade it cuz it's
11:03generally like pretty flat and choppy.
11:06Same thing with second attempts. If you
11:08he he in his video, he showed second
11:11attempts pretty frequently. You know, I
11:12had a loss here, took another try, had a
11:13loss here, took another try. With FX
11:15Replay, the great thing is you can use
11:16tags to see Sorry, let's come back to
11:18the PDF. You can use the tags to see
11:20like is it worth taking the second
11:21attempts or not. So, you can collect the
11:23data and confirm if you should try it or
11:25not.
11:26Um,
11:27he also mentioned you can trade news
11:28with this strategy. The 8:30 a.m. red
11:31folder news. You could trade mean
11:32reversion back to the price before news.
11:35Something else you could try again. I
11:36didn't specifically test those. It's
11:38something you guys can test with the FX
11:40Replay like go to news feature if you
11:41wanted.
11:42Um,
11:43and then let's see a couple other
11:45things.
11:46Oh, yeah. In his video, he shows not in
11:49this specific example, it's probably a
11:50little earlier.
11:51Let me see if I can find where it is.
11:54He shows like a few days of examples in
11:55here.
11:57I'm going to try and find what I'm which
11:58one I want to reference.
11:59He'll trade like
12:01additional continuations after price
12:03comes back. Um,
12:05maybe this is a good one.
12:07So, price has already moved away from
12:08the and already kind of reverted back
12:10and now he's taking subsequent
12:12continuations and mean reversion. So,
12:15in my testing, I tried to focus mostly
12:17on like kind of this first move, the
12:18initial move away and the move back.
12:21But, you could also test and see if
12:22these like kind of second moves are also
12:25worth testing whether that's another
12:26continuation or maybe it comes back up
12:28to the other upside now and you can mean
12:29revert back to it. So, you could also
12:31test with additional
12:33kind of trades after that initial move
12:35away and mean reversion, but I just try
12:37to focus on just that first move to keep
12:39it simple so far
12:41today. So, that's what that bullet
12:42means.
12:43Timing wise again, this is an
12:45optimization opportunity I'm seeing from
12:46some of the data that I'm starting to
12:48test. It may be best to just stop
12:50trading that second hour after the
12:52window. So, maybe only the first 30
12:54minutes of New York open and maybe only
12:57the first hour in that in the afternoon
12:58window. It's again an optimization. As
13:00you get large sample size of data, you
13:02can optimize and see like what the best
13:04times are to trade.
13:05And then I'd already mentioned you could
13:06trade mean reversion either side of the
13:08fair value. So, pretty simple checklist.
13:11We're waiting waiting for for
13:12continuations. We're waiting for either
13:14a break of structure or market structure
13:15break away from the fair value fair
13:17value price
13:18and looking for that combination of
13:19displacement candle plus that break
13:22for our entry. Or if price has already
13:24moved away from fair value price, we're
13:26looking for the same entry model back to
13:28it essentially. Using the ATR to
13:30determine our stop loss and just going
13:32for a fixed 1.5 R no trade management.
13:34So, couple examples and then we'll dive
13:35right into FX Replay. So,
13:37we have actually on this day both trades
13:39played out. So, 9:30 market open
13:41happened here and shortly after we had a
13:43really nice market structure break to
13:44the upside. Price had previously been
13:46trending to the downside.
13:47Our ATR was between 7 and 20, so I was
13:50using a 25 tick stop loss here. Didn't
13:52really get close to it in this case, but
13:53moved up nicely to take profit after we
13:56had a nice decisive candle plus the
13:57break. And then as price came up a
14:00little further, took a little while, we
14:01eventually had a nice decisive candle to
14:02the downside that also broke structure
14:04here. So, we got our kind of two two
14:06checklists for the for the trade. Same
14:09stop loss, the ATR was still in in that
14:11zone. So, same 25 tick stop loss. The
14:13take profit was pretty much right back
14:15to the fair value price and caught two
14:17wins on this specific day.
14:19Now we have an example from that
14:21afternoon session. Similar price action.
14:23Obviously, he's trading in the same
14:25concept in pretty much all of these
14:27situations. And again, we have a break
14:29in structure here. I think price was
14:30previously trending to the upside. So,
14:32break of structure with that decisive
14:34candle
14:35gives us our entry. Stop loss
14:37calculated based on the ATR. Ended up
14:39catching a nice win and the same thing,
14:41wait for that market structure break
14:42with a decisive candle to return back
14:45towards the fair value price. So, not
14:47that complicated of a
14:49entry model, but the timing of it and I
14:51think the optimizations and obviously
14:53like is it something realistic for you
14:54to execute is probably the bigger
14:56question that you need to ask. So, let's
14:58have an FX Replay and do some
14:59validation.
15:00I've obviously been testing this on
15:01myself.
15:02So, I want to get have someone from the
15:04chat give me a totally random point in
15:05time in the last three years or
15:07something. We're going to back test a
15:08totally random point today.
15:10To do Simon
15:13at fair value theory
15:15stream.
15:17So, somebody in the chat give me like a
15:18random day in the last like three years.
15:20I'll pick like a random point in time
15:21for this.
15:24I'm going to load one of my previous
15:25layouts.
15:29Let's do this one.
15:31March 4th, 2025. All right.
15:35All right, March 4th. All right, and
15:37then we'll see how far we get.
15:38We'll we'll at least get through like,
15:40you know, a few days.
15:43>> [clears throat]
15:44>> Nice, somebody shared their birthday.
15:45All right.
15:47So, I've got this layout that I set up
15:48previously. I'm going to go ahead and
15:50make a copy of it like I usually do. So,
15:52I'll make a copy of this.
15:54Make sure that I have a fresh layout.
15:56So, this is stream.
15:59Got to my layout named. I'll delete all
16:00my previous drawing tools so we have a
16:02totally fresh layout. And then
16:04indicators that I have on the chart is
16:05pretty simple. In this lower section
16:07here, I have this ATR.
16:09Which I I think you can type ATR. Yeah,
16:11you just type ATR, average true range.
16:14It's basically like kind of giving you
16:15an indication of how volatile the price
16:17action is or if it's smaller candles, so
16:19it's going to be a smaller so the value
16:20on the right kind of shows you the
16:22current ATR value which we'll use for
16:24our stop loss distance. Then I also have
16:26like this volume overlay. We're not
16:28specifically using it again. If you're
16:29trading like Asia session, I think it's
16:31going to be more important to like watch
16:32for volume spike or something like that.
16:34Otherwise, maybe pass on the session,
16:36but that's you know, also something you
16:37can play around with. So,
16:39I've got couple different
16:41sessions in here. I was testing some
16:42other stuff this weekend. So, let's make
16:43sure we update this specific for the
16:46strategy. So, we want to be going to
16:479:30 for New York sessions. We don't
16:49care about London specifically today.
16:51And then I think there's like a New York
16:53p.m. session that you can do 1400 down
16:55here. So, we can save both of those out
16:57to have access to both of them.
16:59And we'll just jump right next to the
17:00next 9:30 open.
17:03And reset our chart.
17:05So, 1-minute time frame NQ, we are good
17:07to go.
17:08And yeah, let's see what we have. So,
17:10you can mark out the reference price
17:12kind of at market open. He usually
17:14shades like the first candle, but you
17:15can just draw a line. Either one works.
17:17And let's see if we can find
17:19um,
17:20some trades. So again, I'm going to I'm
17:21going to personally be waiting like for
17:23a couple minutes just cuz I'll show you
17:25that at the end after some testing I've
17:26done. It seems like it's best to wait.
17:28So, I'm going to wait like a couple
17:29minutes and then look for that decisive
17:30candle to see if we can get a a break
17:33either side. It's a very large candle.
17:35It's not super decisive yet. I use this
17:37fib retracement tool. Show you guys the
17:39settings specifically. So, you're using
17:410, 2, and 1
17:42for the fib retracement. You can use one
17:44color. It's up to you if you want the
17:46prices or not. I think it's easy, but
17:48yeah, you can apply this fib level from
17:50basically the open of the candle to the
17:52low
17:53and see like did it close decisively or
17:55not. So, in this case we had too large
17:57of a candle wick. So, this doesn't meet
17:58our mechanical decisive candle
18:00definition. Trade could work out, but
18:03we're going to wait for a little more
18:04clear criteria. This actually might be
18:07might be one right here.
18:08So, we do have a decisive candle now.
18:12However, we haven't really broken
18:14structure with this candle. You want to
18:15see the break of the candle and the
18:16decisive
18:18decisive candle in the same
18:19instance, whereas the break kind of
18:21happened this first candle and now we're
18:22in a decisive candle. So, we may just
18:24need to wait for a market structure
18:27or sorry, mean reversion in this case.
18:28Again, very strong decisive candle, but
18:30we do not have the structure to give us
18:33the break. So, we may just kind of miss
18:34this trade. The move happened
18:36like in a couple of candles there.
18:37Unfortunately, it just didn't meet our
18:39specific criteria.
18:40Just for for kicks, let's see the ATR on
18:43this big candle we had down here was was
18:46like 26. This would have been a pretty
18:48large stop loss. And and a pro tip for
18:50you guys, if you're if you're trading
18:51the strategy, I really recommend setting
18:53these um,
18:55thresholds on the on the long and short
18:57position tools and then save them as
18:58templates. So, I already have like some
19:00templates saved out. So, this 50 tick
19:02stop loss, I can literally just right
19:03click it, apply the template, and then
19:05place the order. It's very quick to
19:07apply the different stop loss distances.
19:08So, this this If you would have taken
19:10the less decisive break, this one would
19:12have been a loss. Didn't really go to
19:14our take profit.
19:15This mean reversion might have might
19:17have worked out, but again, we want to
19:19wait for the highest probability setups
19:20that have both the break and the
19:21decisive candle on the same candle.
19:23Okay, there's news. So, yeah.
19:26It has done what he expected. It's kind
19:28of pushed away, come back, pushed away,
19:29come back. So, really the only play left
19:32for this session,
19:34you know, if you wanted to trade the
19:35full, you know, 90 minutes after open is
19:37a mean reversion back to this price. So,
19:39we could see if it if it pushes up, we
19:40could look for mean reversion, but looks
19:42like it's really just hanging around
19:43there. So, probably just better off
19:45going to the afternoon session now.
19:47Let's go to New York session.
19:49And again, we'll mark out the opening
19:51price
19:52Kind of at the start of the session,
19:54look for a continuation away from it. Um
19:57the afternoon session from my testing
19:58didn't matter as much if you waited a
20:00few candles or not. So this like New
20:02York market open is like crazy volatile.
20:05Um but afternoon it seems like even if
20:06it's like the first candle of the PM
20:08session that seemed to was fine uh to
20:10take if it met the criteria. So I think
20:11we finally have a a trade here. So we
20:14have a break in structure right here. We
20:16took out this high.
20:17We've been in an uptrend. We have formed
20:19a swing high here. We pushed through it.
20:21Now we're just going to verify the
20:22decisive candle. Uh looks pretty
20:24decisive to me but we can apply our fib
20:26just to like double check.
20:27So from the high to low it's very close
20:29and this is where the price levels might
20:30come into play. 2606.25
20:34and it's literally right at that. So um
20:36I'll let you guys decide if we want to
20:37allow it to be exactly equal amount.
20:39We'll go ahead and take it. Um I think
20:41in the PDF I said it it can't be more
20:43than. Um so we'll uh apply the and then
20:46our what's our ATR? ATR is 23. So this
20:48is also still pretty volatile. Um so
20:50apply the 50 tick stop loss. Pretty big
20:52stop loss. Um but we'll we've got our uh
20:55levels applied. We'll place the order
20:56here.
20:57I've been using entry trigger one for
20:59the continuations, entry trigger two for
21:01the uh meaner versions. So we'll do that
21:04and let me just let it play out. See
21:06what happens. Nice. Got a win.
21:08Um I'm going to make sure there's no
21:09questions there. Somebody mentioned
21:11there's also like a candle strength
21:12indicator um that they've used in the
21:14past. Um me honestly you guys you guys
21:16could probably uh code now that we have
21:17the custom indicators in FX Replay. Um
21:19you could probably code this logic into
21:21an indicator um and like I've I've in
21:23the past you know tried a little bit of
21:25coding and like you can sometimes use
21:27like you know if you want to distinguish
21:29the decisive candles or not like make
21:30them have a white body or something like
21:31that um to make it easily visibly to see
21:34but for now with testing you can
21:35obviously just use the fib retracement
21:37uh tools and it's super easy. Um doesn't
21:39take that long. You just just check it
21:40out when you're testing. Okay. Might
21:42have gone one too far.
21:43So did we form a swing low here? That's
21:46the only thing. I'm not really seeing
21:47like a clear structural low. We've kind
21:49of just like slowly melted up. We didn't
21:51form like a decisive low here. Like if
21:54you were really getting cute you could
21:56say like we did kind of go up come down.
21:58Um but I personally like visibly I'm not
22:00seeing like a clear wick low. Um so this
22:03probably doesn't quite meet the like eye
22:04test for me. Um I'd rather see like a
22:06clear market structure break.
22:09And it might work out. It probably will
22:10work out. But I want to try and like
22:13visibly see. Okay. So this is like a
22:15better definition but now we're pretty
22:16we're already like pretty close to the
22:18meaner version level. So in cases like
22:20this I I was was really like not trying
22:22to take the trade if we're already
22:23pretty much like at our target. Like if
22:25we're using um the 50 tick take profit
22:2750 tick stop loss here like you'd have
22:29to go all the way back through and it's
22:30just like a little lower probability
22:32than maybe if we were taking it up here.
22:34Um
22:35So this trade you know would have been a
22:36little more in line with the fair value
22:38theory. Um and I guess like if the take
22:40profit level is like a little bit past
22:42the fair value price it's probably okay.
22:44He definitely has some examples where he
22:45he does do that but if we're already
22:47like super close to it I think these
22:49trades are probably going to be a little
22:50lower probability. We'll go ahead and
22:52take it um just to see but I do think
22:54like it's going to be better if you if
22:55you're already kind of away from the
22:57from the level a little bit. Um so we'll
22:59say this is entry trigger two for our
23:02meaner versions.
23:03And I guess another way if if it comes
23:05back to the fair value price you could
23:07um go break even at that point.
23:09Um yeah we got super close to our stop
23:11loss and yeah got a loss there. So yeah
23:13I do think um
23:14in my testing I probably wouldn't have
23:16taken this. I I took it today just to
23:17show you guys kind of what the trades
23:18would look like but overall um kind of
23:21had the right idea didn't just didn't
23:22quite come back to our fair value
23:23theory. Um so very deci- very uh large
23:27candle to the downside but not decisive
23:28and it's also within that first kind of
23:303 minutes.
23:32Also pretty large candle.
23:34Um
23:35So waiting a little bit here.
23:37We are kind of coming back into the
23:39price. Um so we could potentially see a
23:42continue still see a continuation away.
23:44Um we are kind of reverting around the
23:46level but not seeing any specific This
23:49is probably pretty close to decisive
23:50candle but I can already tell it wasn't
23:52quite. I've been testing this enough
23:54that I could see it wasn't quite um a
23:56decisive candle. There's a little bit
23:58was a little bit too much of a counter
23:59wick.
24:00Um so now we're looking for mostly just
24:02meaner versions. We want to see price
24:04pushing away um from the zone either
24:06either side and looking for a meaner
24:07version.
24:08So see if we can get some sort of
24:09structure break
24:11with a decisive candle
24:13before our trading window ends. We've
24:15still got a little bit time.
24:18Okay. We're continuing to push up. No
24:20strong candle. That's a very strong
24:21decisive candle. Hasn't quite cleared
24:23our structure yet. Um so again doesn't
24:25quite meet the combined criteria that we
24:28have um for the break plus the um this
24:30decisive candle plus the break. Um but
24:33does look like the right kind of candle
24:35we want and we may just be after yeah
24:36we've already kind of 30 minutes into
24:38our I'm sorry we have 30 minutes left.
24:39Um we could test.
24:41So we still have a little bit time we
24:42could look for a meaner version if it
24:44meets the criteria.
24:46You can see here like even though we had
24:47the the kind of strong displacement
24:49candle since there wasn't a structure
24:51break it didn't work out. Um so that's
24:53why the combination of the two is going
24:54to be higher probability for sure. Uh so
24:57this is probably good enough. Um it's
24:58definitely um not as good as like this
25:02strong candle here. Um but if we do have
25:04a really decisive candle here and it did
25:06form the break in structure. We have now
25:08closed below this previous structure
25:09level. So I think this is probably good
25:10enough. Um our ATR at this point is
25:13still 26. Um so we're still going to
25:14stick with the 50 tick. Um we're
25:16probably going to be 50 ticks alive if
25:18this is 2025.
25:19Um
25:20So we'll go for this one uh with entry
25:22trigger two
25:23for our meaner versions. Um again you
25:26could use additional tags for other
25:27confluences or anything else you want.
25:29No trade management. Just simply letting
25:31it play out. Front ran our tick profit
25:33by two
25:34>> [laughter]
25:34>> couple ticks.
25:35And eventually got TP. Nice. Um so that
25:37would have been a pretty emotional
25:39roller coaster if you were taking that
25:41one but eventually played out. He
25:43doesn't do any trade management as far
25:44as I know. He just lets it play out um
25:46win or loss. Um somebody asked a
25:47specific question what about the large
25:48green candle on this uh this day? Uh
25:50large green candle at 10 to 10:05
25:54I think they said. Um 10:05 right here.
25:58Maybe right here. Um Okay. One of these
26:00times. So there's a large green candle
26:02right here and this is where um I'd
26:04mentioned in the PDF um specifically
26:08you could take additional continuations
26:10after price returns to fair value. Um
26:13but you'd probably want to use a
26:14separate tag. So like when I've been
26:16testing
26:17he he said specifically in his video he
26:19really tries to look for um
26:21continuations the first like 10 minutes
26:22or so. Um so this is like you know
26:2534 33 minutes after open. It's it's
26:28pretty you know it's it's a it's
26:30definitely after the period that he
26:31started. Um so you could you could test
26:33these and see like okay if it's come
26:34back to the zone and we see a
26:35continuation maybe I use entry trigger
26:38three for those like kind of second move
26:40continuations or something like that.
26:41And you can collect data to see like are
26:43those worth taking or is that first move
26:45really like the best thing to take? Same
26:47thing like we're taking it we took a
26:49meaner version short here but say you
26:51were in the session we saw this meaner
26:53version short and you saw like uh an
26:55opportunity for a meaner version long
26:57like still in your session you could
26:58also take these kind of second move
27:00meaner versions and see if those are
27:02worth taking too. So recommend using
27:03different tags um and see
27:06as we usually do we'll mark out the
27:07reference price so it's easy to see
27:09visually.
27:11You could probably code an indicator to
27:12do that too but it's not that hard to
27:14just draw a line.
27:15Um so nice decisive candle. Nice
27:19structure break. Let's see if it's
27:20decisive or not.
27:23Yep. No the counter wick is less than
27:2520% so we got everything we need here
27:26for a continuation.
27:28What's our ATR? ATR is 22 still so still
27:30going with the 50 tick
27:33stop loss. Um so we'll take this one
27:36with entry trigger one.
27:38Place the order.
27:40Let's see what we got here.
27:43Come chop around a bit. Getting closer
27:45to take profit. Nice win.
27:47So now uh we can look for the meaner
27:49version back. Um we're looking for the
27:51same same price signature. The break
27:53with the strong decisive candle which we
27:55have right there.
27:56Check our ATR quickly. It's 20.25 so
27:58it's just over the 20 threshold. If it's
28:00under 20 then we would drop it um to the
28:0225 tick but we'll stick with our 50
28:04tick. Um can try and look for a move
28:06back to the level.
28:08Uh we'll say this is entry trigger two
28:10for our meaner versions.
28:12And we'll see what we got in this case.
28:13Chopped around a little bit and nice win
28:15again. We're on a nice little win
28:16streak. I will say like um the thing
28:18that I like about this strategy that I
28:20haven't seen in a lot of the strategies
28:22I test is it's it's not going for the
28:25most precision in terms of stop loss
28:27that other strategies have where you'll
28:29use the recent structural low or maybe
28:31even like to get a little more risk
28:32reward you use like the body low. Um
28:34he's not as concerned about being so
28:36precise with getting the exact right
28:38entry or the exact right stop loss. He's
28:40just like trying to say okay I think in
28:43general price is going to go this way so
28:44as long as I give myself enough wiggle
28:46room to to catch that move then I
28:48hopefully I'll be right more than I'm
28:50wrong. Um so that's like kind of the the
28:51thing I do like about these like um ATR
28:55based stop losses. It's it's something
28:56you could play around with other
28:57strategies too if you keep getting
28:59barely stopped out on the move when you
29:01generally have the right idea. It may be
29:02better to use a little more general um
29:04kind of numbers based um stop loss
29:06instead of always using structure or
29:08something like that.
29:10Um
29:11And then yeah it's obviously going to be
29:12hard like hard to execute in a live
29:14market for sure. Um but again um outside
29:18of the like New York open trades where
29:19you do tend to have to be pretty quick.
29:21Like price often you know does give you
29:24a little bit of time to execute this.
29:25Like even though it entered here you had
29:28like seven whole minutes to enter at
29:30this price. Um obviously sometimes it's
29:32going to go immediately and you'll just
29:33like you might miss it. Um but even here
29:35you had a couple couple other tries. So
29:36even if you know by the time you see it
29:39it's too late you could still see if you
29:41can catch like a limit order at the end
29:42at the same price before it takes
29:44profit. I bet you'd still they'll to
29:45catch a good amount of the trades Even
29:47if you couldn't execute like a right at
29:48the exact um point that it triggers.
29:52So this is again where you could
29:53potentially track
29:55a kind of second move continuation super
29:58strong candle.
29:59Definitely broke a lot of of structure
30:01right here.
30:02Decent chance that it has continuation.
30:04I'm not going to specifically record it
30:06because I haven't been recording these
30:07testing.
30:08So I just don't really have the data on
30:09them, but this is definitely something
30:11if you want to increase the trade
30:13frequency even more, you could also test
30:15these kind of second move continuations
30:17and mean reversions.
30:19Does look like it would moved a little
30:20bit, but probably would have cut a loss
30:22off that one. The The candle is like
30:24already too large.
30:25So it's probably good enough. Again, I
30:27don't want to trade past the you know
30:29first hour of the afternoon session. We
30:30kind of already got two wins. So
30:32probably you should probably be happy
30:33with that. So
30:35it is specific criteria that you need
30:37the break and the decisive candle on the
30:39same candle.
30:40We didn't have the decisiveness on this
30:42candle. We don't technically have a
30:44break on this candle. So this move might
30:46work out, but you know
30:49also might not have worked out. So
30:51waiting for those specific criteria to
30:53be met probably going to improve
30:55your probability over time. But yeah,
30:57the fair fair value theory played out.
30:59It moved away, came back to it. Now
31:00we're moving back up. We can still look
31:02for a mean reversion for for a little
31:03while. It's a really good candle. Didn't
31:05quite break our structure yet though.
31:07That doesn't quite meet our criteria.
31:08This one might be good enough. Let's see
31:10if it's decisive. Pretty sure it is.
31:1220 at 152. Yeah, we're definitely below
31:15that level we needed for the
31:16decisiveness. So what's our ATR at? We
31:19are at 35 ATR man. This is super
31:22volatile.
31:24This might be getting close to when the
31:25tariff stuff was happening last year.
31:27Can't remember. But yeah, definitely 50
31:28tick stop loss kind of coincides with
31:31this candle high. And let's see if we
31:32can catch a mean reversion back to
31:35our entry with entry trigger two.
31:38We got close to our take profits.
31:42Nice win. So yeah, the
31:44stop loss distances have been working
31:46great. There's been quite a few trades
31:48where we did come into a little bit of
31:49drawdown, but because we were adjusting
31:52the stop appropriately for the
31:53volatility, we were able to kind of
31:56you know survive and and wait for a win.
31:58So really happy with that. And now we
32:00can go to our PM session.
32:02New York PM session.
32:04Okay, there we go. That's exactly what
32:05we want. Now let's just see if it's like
32:07too close to the level.
32:08Our ATR is 24 still. So we're still
32:10using our
32:1250 tick stop loss.
32:14And again, just to show you guys how you
32:15can adjust that.
32:16I have this template for 50 ticks, but
32:18if I wanted to use 25, I have this
32:20template. I can easily like very quickly
32:22modify like the levels. It's super fast.
32:25And if you have these templates saved,
32:26you just apply the template and then
32:28place the order. It's super quick to
32:30apply these different stop loss
32:31thresholds depending on
32:33what you need. So again, this is a
32:35example where like the take profit is
32:37quite a bit of ways beyond the fair
32:39value level. So either you would
32:41probably want to pass on this or I don't
32:43know. Another option you have is if it
32:45taps if it taps the fair value price,
32:47maybe at least go break even at that
32:48point. So maybe that's what we'll try
32:50this time to at least make sure it
32:52doesn't like come back on us if it cuz I
32:54think he said like it's pretty random
32:56after it comes back to the fair value
32:58levels. This is entry trigger two for a
33:00mean reversion.
33:01We'll pull out our fair value price
33:03again just a little bit further.
33:05So we did tap it like to the tick pretty
33:07much and came back. So like I said,
33:09maybe we'll go break even here. But
33:10yeah, the fact that our take profit was
33:12kind of beyond the fair value price just
33:13made this one a little lower probability
33:15I think.
33:16So it's good to the next session. Again,
33:17this is why we're trying to avoid the
33:19first few minutes of New York open
33:21because it can be super volatile. Really
33:23nice
33:24break candle here, but probably not
33:26decisive enough.
33:28We would need 830.5
33:31and it's 820. Actually this is.
33:34Yeah, it was decisive enough. I didn't
33:36think it was, but it did pass the level.
33:38So we can use
33:40our short here for continuation. And we
33:42finally have an ATR below 20. Barely.
33:4519.7.
33:46So this is where we could use the 25
33:48tick stop loss. It looks a little tight
33:50like obviously compared to the candle.
33:52This is maybe a little higher
33:53probability to stop us out. We'll see
33:55what happens this one.
33:57Actually worked out. So I thought it was
33:59going to be 50/50
34:00cuz we didn't have a lot of room for it
34:01to come back, but just going for that
34:03one and a half hour,
34:05we were able to catch it catch it for a
34:06nice win.
34:08And then yeah, not probably not going to
34:10have a whole opportunity for mean
34:11reversion. It happened like very quick.
34:13And again, this potentially could have
34:15been an entry for us, but at that point
34:17ATR is back over
34:2020. So yeah, our take profit is like way
34:23on the other side now of the ATR.
34:26So it's going to be probably a little
34:27lower probability. But we can see if it
34:28pushes away either side and see if we
34:30get a mean reversion
34:32after the fact.
34:33So let's see if we can get a mean
34:35reversion that meets our criteria.
34:36Looking for a structural break plus the
34:38decisive candle.
34:41Playing forward a little bit. I might
34:42have missed one. Let's see.
34:46So we had a little little baby swing
34:48high right here and a break above it. I
34:50don't know if this is decisive enough.
34:53Let's measure it. So the level is
34:5519732.5.
34:57So it did not quite. It was like one
34:59point off.
35:00And so I'm basically like looking at the
35:02price level on the 0.2 to see like okay,
35:05price needed to close at or above this
35:08level. And then like for the current
35:10candle price, you can see what the price
35:11is. So you can basically compare those
35:13and see
35:14pretty quickly if it's decisive or not.
35:16Hopefully that's helpful. Or obviously
35:17make an indicator for it.
35:19So it didn't quite meet the criteria
35:20there. We're still continuing to wait
35:22for the specific criteria we need.
35:25Strong candle not quite decisive enough
35:27I can tell.
35:29We may be getting We still got like 30
35:31minutes I guess. So again, I was seeing
35:34a little lower probability after the
35:35first 30 minutes, but
35:37we can still trade through through 11
35:39cuz he says he'll generally trade like
35:40the first 90 minutes after open.
35:43Still just kind of melting down.
35:45We are pretty far away from our price
35:47theory. And I guess like other thing
35:48that I do want to mention too,
35:50I've simplified his strategy a lot, but
35:51like you'll see in his video like he's
35:53looking up like Trump tweets and things
35:54like that to see like is there new
35:56information that validates this move?
35:59Like I don't know. Maybe something came
36:00out and the market does not like it. And
36:03you know, maybe we don't have it as like
36:04a standard red folder event or something
36:06like that, but in real time maybe there
36:08was actually something that validated
36:10like okay, this is like a a reasonable
36:11move because of this new information the
36:13market didn't like.
36:15So that's something that you have more
36:16access to when live trading and
36:18backtesting. I think it's something
36:19better to focus on the data that you do
36:21have consistently, which is obviously
36:23time and price and like expected news.
36:27But but obviously like in a live
36:29environment with a little more
36:30discretion, I think he's able to
36:32have a little more context and draw
36:34additional like fair value levels beyond
36:37just these opening prices. He'll you'll
36:39often see in some of his videos where
36:41he'll draw like kind of like what seem
36:43like almost like random consolidations
36:45where he'll like see okay, this is like
36:47where the market had now kind of agreed
36:49that the price fair value was kind of
36:50around this level.
36:52So there are additional
36:54fair value levels you could trade as
36:56well, but you would probably need a
36:57little bit more insights on how exactly
36:59he does that. I think
37:00it's fine to just stick to these opens.
37:02It's it works well enough it seems.
37:04Okay, maybe we're we're getting pretty
37:05close to the end of the hour. So far
37:07just no trades this day. So let's look
37:09at the analytics. Like I said, this is
37:10going to be above average. Like I will
37:12show you guys the other sessions I
37:13tested. It is not this high of a win
37:15rate, but thank you for whoever
37:17suggested
37:19March of 2025 cuz yeah, this strategy
37:21crushed during the period we tested. But
37:23obviously it's only eight trades.
37:25So this is like another important thing.
37:28Just as important as if you test a
37:30strategy for 10 trades and it sucks.
37:32If you test a strategy for 10 trades and
37:34it's amazing, it doesn't guarantee that
37:36it's going to do well over a large
37:37sample size. You need to make sure to
37:38validate with a proper sample size. So I
37:40will show you guys some periods that
37:43I've tested to give a little more
37:45context. So I tested 2020 February of
37:48this year cuz obviously he's been
37:50trading this pretty recently. So I
37:51wanted to see how it did
37:53earlier this year. So let's see if I can
37:54filter
37:55on that. I think I tried to name it like
37:58February 2026 or something like that.
38:01So I tested 43 trades over that period.
38:05And in the month of February I was able
38:06to get 19R.
38:08Actually this is this is only like half
38:09of February. So this is
38:12very good. You know, 19R in
38:15You know, you're obviously you're
38:15trading a lot. There's quite a bit of
38:16chart time.
38:18And obviously one minute charts like
38:19drive some people crazy. So you have to
38:20be have the
38:22aptitude and desire to do it. But higher
38:24frequency with a lower time frame. 58%
38:27win rate performed very very well during
38:29this period this recent period that I
38:30tested. Let's jump around. What other
38:32periods I test? I tested this like
38:34pretty strict uptrend here from like
38:37April of
38:392025 like late April 2025 to like early
38:42May. So
38:44let's come back to the replay. Filter on
38:46that session.
38:48If I grab it here, this would have been
38:51uptrend probably.
38:53Upholding market.
38:56Okay. And
38:58started out of definitely a little
38:59flatter.
39:01For for a while we were having around
39:03like you know, plus or minus 5R with a
39:04little bit of drawdown. Eventually
39:06caught a little steam towards the the
39:07later half of it. And so also
39:10profitable. 56% win rate. I think it's a
39:12much more reasonable compared to like
39:1485% win rate or something like that. But
39:16that's a solid profit factor. Like 1.93
39:18profit factor is really good.
39:20And then last period I tested, I think I
39:23wanted to yeah, super super choppy
39:25market. So I tried to find like the
39:26rangiest conditions I could find. This
39:29is like April of 2023 through
39:33April yeah, basically April of 2023.
39:36And I don't even know if he's tested
39:37this far back. I think he's most of his
39:38testing has been the last two years. So
39:40this would have been kind of ranging
39:42market conditions. So, I'll filter on
39:44those real quick.
39:45Ranging markets.
39:47Not as good.
39:49Um,
39:49it was, you know, I I think most
39:51strategy Even with the mean reversion,
39:52you probably the mean reversions were
39:54okay here. Um, but overall, it was still
39:56a little bit worse in this condition. I
39:58think most strategies are probably not
40:00going to trade well when you got barcode
40:02price action. Um,
40:03but uh to give you guys I've jumped
40:05around a few different market conditions
40:06and we have like a really good sample
40:08size for this. I want to show you guys.
40:09So, now if we go to our recent session,
40:11I've created a strategy for this and all
40:14these sessions that I've traded, I'm
40:16going to link up to this specific
40:17strategy.
40:18Um, so we can look at all the analytics
40:20together and get some really good
40:21insights. So, JJ Fair Value Theory.
40:23If you tie your sessions to the
40:25strategy, then you can filter the
40:26strategy um itself either by going to
40:29the analytics
40:30and then
40:32filtering, you don't need the sessions
40:33anymore, but if you look for
40:35the specific strategy,
40:37you can filter it that way. Or often
40:39what I'll do um
40:40is just go to the strategies page.
40:42I have to like search for it cuz I have
40:43so many of them now.
40:45But you could also just click the
40:46analytics from the strategies page and
40:48get it a little quicker. Um, so overall,
40:50uh testing that we have, uh yeah, a lot
40:52of profit in two weeks, but also a lot
40:54of chart time and probably a lot of gray
40:55hairs from trading one minute charts.
40:58So, if it's for you, then great, but
40:59it's definitely not for everyone. Um,
41:02but yeah, let's talk about what we have.
41:03So, 158 trades. Um, you're welcome. I
41:06was curious and like I thought in
41:08specifically in his case since he is
41:10like such a new trader, um you know,
41:13even we've had other traders that I've
41:15tested, Trader Cain, um
41:16Tom Trades, Scarface, who like have been
41:19like around a little bit longer and are
41:21making these claims. This guy like made
41:22his YouTube channel like two weeks ago.
41:24So, I really wanted to spend some time
41:26and actually validate and help you guys
41:27like make sure you're not wasting your
41:29time. Um, so I was curious and it was it
41:31was fast enough to test. Um, but I, you
41:33know, jumped down and did 158 trades for
41:35you guys, so you're welcome. Um, I still
41:36encourage you you to test this yourself
41:38obviously, but over all the period we
41:40tested, 54% win rates,
41:431.76 profit factor. Honestly very solid.
41:46Um, we can look at the different um tags
41:48that we have and then see how they how
41:50they varied um by time frame. So, and
41:53the continuations have slightly higher
41:54win rate, which is very common.
41:55Continuations generally tend to be a
41:57little higher probability over two
41:59profit factor.
42:01Max win streak of eight, max loss streak
42:02of five. Um, we had more buys than sells
42:07in the period.
42:08Um,
42:10and then yeah, pretty similar results
42:12between the AM session and PM session.
42:14Probably slightly higher win rate in the
42:16PM session, it looks like, um but still
42:18profitable in in the performance
42:20session. Uh performance by day, um
42:22Tuesdays, Wednesdays seems a little
42:24lower, but again, this is something that
42:25as you get, I mean, this is a pretty
42:27good sample size, but
42:28over 200 trades, you would probably
42:30going to say like definitively, okay, if
42:32I take out Tuesdays and Wednesdays, I'll
42:34be able to pretty, you know,
42:35significantly improve my results. Um,
42:37and again, looking at performance by
42:38month, anywhere between um sorry.
42:42Anywhere between like 2% uh sorry, 2R
42:44and 15R just trading the continuations.
42:47Um,
42:48we can also look at the risk reward
42:49simulator. I'll run that real quick
42:50before we pivot over to the mean
42:51reversions. And yeah, 1.5 is optimal um
42:55for this strategy the the way we traded
42:57it. It doesn't say that any other risk
42:59reward level is going to drastically
43:01improve our results. I mean, we could
43:02get really granular if we wanted and see
43:04like, okay, what about 1.4R or what
43:07about uh 1.6R?
43:10Really close and see, okay, there you
43:12go. 1.6R is slightly better. So, if you
43:15want to get a little bit more out of the
43:16edge, um you maybe you can go 1.6R
43:19instead of
43:20uh just 1.5. And then obviously, same
43:22thing with other optimizations. I'm sure
43:24there were some trades where it was
43:25worth, you know, trying to trail if
43:27there's trend line liquidity or
43:28something like that. So, you could
43:29obviously play around with additional
43:31optimizations like that, too. But risk
43:33reward simulator shows a little bit of
43:34insights. Maybe we can get a little bit
43:35more of the continuations by going for
43:371.6R instead of 1.5.
43:40Um,
43:41and then now let's look at the entry
43:42trigger two. Um, cuz that's going to be
43:44the mean reversions and see what
43:46insights we can have from that. So,
43:47little lower win rate, 59 or 49% win
43:49rate. Still 15R over the period, 1.46
43:53profit factor, still not quite as good,
43:54but I definitely think there's some good
43:56optimization opportunities with this.
43:58Um, obviously we had a little bit of a
43:59larger loss streak with the lower win
44:01rates.
44:02But um
44:04this is what I wanted to show you guys.
44:05So, from the testing that I've done,
44:07it seems like um you may not want to
44:10take mean reversions if they happen
44:12after the first 30 minutes of New York
44:14open, which means basically only take
44:16mean reversions if they happen within
44:17that first 30 minutes of open. You know,
44:20you've you've taken the continuation or
44:21maybe there wasn't a continuation, but
44:23price has at least moved away um from
44:25the level and you're taking kind of an
44:26earlier reversion back to the level cuz
44:28it seems like later on um they are a
44:30little lower probability. Again, I
44:31didn't personally take those like second
44:34mover versions. Um, so if you added
44:37those to the mix, like um like this one
44:39for example, that's kind of the second
44:41mover version.
44:42Maybe if you added more of these, it
44:44would maybe offset and improve that
44:47second hour window or whatever, but for
44:50my testing, I was mostly focused on kind
44:51of that first move.
44:53So, just some context there. If you if
44:55you're testing it like I had, then you
44:57probably want to just stick to the first
44:5830 minutes. And then same thing, it
45:00seems like the trades there's there's
45:01only eight trades, so not super
45:03material, but you probably only only
45:04want to trade mean reversions the first
45:06hour
45:07of that PM window and just don't worry
45:08about trading the last um last like I
45:11guess 3:00 p.m. to 4:00 p.m. of New York
45:14session. Performance by day, maybe drop
45:16Wednesdays. Um, seems like Wednesdays do
45:18not do well and maybe increase risk
45:21Fridays. Again, these are I have decent
45:23sample size here. This is 67 trades.
45:25This would be better way better with
45:26like 2 300 trades.
45:28Um, but if you get large sample size,
45:29you can get some good insights to see,
45:31okay, I need to just drop Wednesdays and
45:32maybe I go I risk 2R instead of 1R um
45:36for for Fridays if they're doing it in
45:3890% win rates. Um, same thing
45:41with performance by month. A little
45:42lower on these. Definitely most of our
45:44returns came from the continuations.
45:47Just looking at this these monthly
45:48performances, we got 15R here versus
45:51entry trigger one. Um,
45:53I think it was like 40R if I remember.
45:55Um, I'm pretty sure it's like 40R. But I
45:56want to look at the risk reward
45:57simulator for these as well.
45:59So,
46:00interesting.
46:01Um, if you are ex- if you can accept a
46:0427% win rate, um
46:07it seems like holding the mean reversion
46:09a little better. Um, could improve your
46:11results a little bit.
46:12Um, I usually don't recommend people go
46:15for a 27% win rate strategy, so I would
46:17say probably this probably gives you an
46:19idea that in certain occasions, there
46:22are reasons to like trail the stop loss.
46:25Um,
46:26you know, if you have I'm trying to see
46:27if I can come up with a quick example
46:29right here. Um, like in this specific
46:30this is a is a good example. Like this
46:32trade right here kind of just melted
46:34straight down. There weren't like there
46:35were there weren't highs. There wasn't
46:36trend line liquidity in the sense that
46:38um
46:39there weren't like additional levels
46:40that could propel price further very
46:42easily. Instead, you were kind of coming
46:43into these imbalances that could reject
46:45down. So, like a trade like this, you
46:47probably wouldn't want to um to try and
46:50hold for longer, but let me see if I can
46:51find uh the same example. We'll go down
46:54here.
46:55If you were trading a mean reversion
46:56down here, um you see here we have some
46:58kind of trend line liquidity from these
46:59kind of stacked highs along the way. So,
47:01it's maybe a little better um to to
47:03trail the stop. So, giving you guys some
47:04ideas that your trailing stop loss
47:06application for optimizations doesn't
47:08have to be every trade. You could
47:09identify um specific conditions that are
47:12more con- you know, condoning on holding
47:14holding the trade longer and seeing it
47:16if you hold certain trades longer, you
47:18could potentially improve results um
47:19based on this. Um, that's probably what
47:21I would try and do so that instead of
47:23just accepting 27% win rate, maybe you
47:25can get somewhere in between there, um
47:27but improve your your average risk
47:28reward. Um, but I think even if we just
47:31excluded uh those
47:33um the times that we that we saw, um
47:34we'll see pretty good results. Like I in
47:36fact did that.
47:37So, I took my FX Replay export, which
47:39you can do at the top here, and
47:41literally just dumped it into Excel real
47:42quick. I was looking at continuations
47:44first. And to show you guys um why I
47:46found like the first three minutes were
47:48bad. So, you could filter these like by
47:50time. So, this is this is just the FX
47:52Replay export and then I added this um
47:55formula mod of the the time.
47:58And then you just put a comma one. It
48:00just gives you like the time and you
48:02just format it as a time. So, you can
48:04get the specific time for the trades.
48:06And then if I just literally filter on
48:08the first like three minutes, uh we made
48:10like 40R um across all these, I'm pretty
48:12sure. Where's the P&L right here? 36R.
48:16Over these and then this is like the
48:18testing I did before. It doesn't include
48:19the most recent data.
48:21But if we filter just the first three
48:22minutes,
48:24uh we've only made 2R um in that and
48:26there's there's like what it what is
48:28this like?
48:29Uh
48:30am I I'm not seeing the count here.
48:31Let's see the count. 28 trades, you're
48:33only making 2R. Um, so it's going to be
48:34a super low win rates. Um, I don't know
48:36if I counted it, probably like 40 40%
48:38win rate something like that. Um, all
48:40this to say like it it may be worth
48:41waiting like three minutes after open
48:44and not taking those first first few
48:46candle continuations cuz they do seem
48:48like they're a little lower probability
48:50based on that. And then
48:52So, if we if we remove these trades and
48:54then if we take out those
48:57um kind of bad windows for our entry
48:59trigger two, which were basically the uh
49:0210:00 to 11:00 window and the the 3:00
49:04to 4:00 p.m. window. Um, so if you do a
49:06few simple optimizations just like kind
49:08of using the analytics, uh where is
49:10this? Right up here.
49:12Um, which I've done here. I've kind of
49:14combined everything.
49:15We instead of having and I'll look at
49:18our I'll compare like our overall
49:19analytics
49:21without this new session. So, let me
49:23just I'll just do a little comparison
49:24for you guys.
49:25So, this is all the testing I did
49:26before. Um, hunt still 150 trades, 46R,
49:29uh 52% win rate, 1.66 profit factor. And
49:32then after I removed
49:34a few of those um I removed those first
49:36three minutes. I removed the 10 and 11
49:38hour versions. I removed the 3 to 4 p.m.
49:40hour versions. Now we have a 2.46 profit
49:43factor with a 62% win rate. So, very
49:45simple optimization. No new rules or
49:47whatsoever. Just literally like using
49:48the time.
49:49Um,
49:50date your data um, from the analytics to
49:52optimize. So,
49:54um,
49:54I'm honestly going to say like this JJ
49:56guy might be legit. Um, I hope he
49:58doesn't come out like in a week on JJ's
50:00a fraud.
50:01>> [laughter]
50:01>> Um, but we put his strategy to the test
50:04with no bias, no um, expectations. Um,
50:08made a little bit more of of mechanical
50:10rule set so you could consistently
50:12identify and execute it.
50:14Um, so, you know, slightly different
50:16than maybe the video he showed. Um,
50:17being a little more specific with the
50:19combination of criteria that we had. But
50:22honestly, yeah, this is a super solid
50:24um,
50:24data set that we have so far. Definitely
50:26a
50:27promising strategy that if you love
50:291-minute time frame NQ scalping, um,
50:32could be a strategy for you. And check
50:33it out.
50:34Um,
50:35if you guys want more information about
50:37um, FX Replays uh, Discord. Um, it's
50:40also linked in all of the YouTube
50:42videos. Um, or I'll probably on the
50:44website if you scroll down to the
50:45bottom. Um, there's a Discord icon.
50:47Um, so if you want to, you know, see if
50:49other people are checking uh, this
50:50strategy other strategies, feel free to
50:51hop in the Discord. Um, ask questions. I
50:53usually am answering answering questions
50:56and also other traders. Um, so you guys
50:57can can hop in there. Totally free. And
50:59then obviously, um, FX Replays going to
51:01be the best way to for you guys to
51:02actually validate these strategies
51:04yourself instead of just trusting
51:06anybody, myself included, that um, that
51:08it does well. But yeah, the period we
51:10tested today obviously crushed. But I'm
51:11sure there's also periods that you have
51:1330% win rates. Um, so, um, yeah. We'll
51:15see if uh, he comes out with more
51:17content. But does seem like a promising
51:19NQ scalping strategy for those of you
51:21that want to check that out. So, but
51:22with that, we'll wrap it up. Hope you
51:23guys have a great rest of your week and
51:25I'll see you later everyone. Bye.

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