Stupid Simple Trend Continuation Strategy — Transcript

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1. 0:00Find the trend. Mark the last break of
2. 0:02structure in direction of that trend and
3. 0:05highlight that area. Wait for liquidity.
4. 0:07That is a tap back that makes a lower
5. 0:09low. This is not liquidity. This is not
6. 0:11liquidity. Only when we make a lower
7. 0:13low, this becomes liquidity. Nice, we
8. 0:15tapped into the zone, we made a lower
9. 0:17low, so this can now be marked as
10. 0:19liquidity. Check, is my zone still
11. 0:21fresh? Yes. So, when price comes back to
12. 0:24sweep liquidity and back into my zone, I
13. 0:26can enter my shorts and be comfortable
14. 0:28targeting lower prices. This is exactly
15. 0:30how I trade the markets every single
16. 0:32day. Follow me to learn more. Love it
17. 0:34because it's trend following, you're not
18. 0:35going to go against the trend. It
19. 0:37gathers liquidity before actually making
20. 0:39a move. All the good things to have a
21. 0:42proper setup. So, like always, let's
22. 0:44test it. I actually built the entire
23. 0:46indicator with Lux Algo Quant. What it
24. 0:48does is identifies break of structure.
25. 0:50It only trades the first break of
26. 0:52structure after a change of character,
27. 0:54and when price actually goes and sweeps
28. 0:56a higher low that is formed or lower
29. 0:59high that is formed or before, takes
30. 1:00that entry when it snaps back and
31. 1:02targets a ratio based on that zone. As
32. 1:05you can see here on the NQ 5 minute, it
33. 1:07had a very nice trade today. If we go
34. 1:08back and look, and as you can see here,
35. 1:10another one, a change of character, a
36. 1:12break of structure, price immediately
37. 1:13reverses, takes out the previous lower
38. 1:15high, enters a short on that rejection,
39. 1:18has a stop at the zone high, and then
40. 1:20ends up going to run through that low.
41. 1:22Now, this is all great when you're
42. 1:23looking at it on the chart, and there is
43. 1:25A+ setups and then sometimes B setups,
44. 1:28but let's just backtest all the setups
45. 1:30and see if it's viable. What I'm going
46. 1:31to do here is on Lux Algo Quant now, I
47. 1:33can click this button called backtest,
48. 1:35and it's going to immediately run a
49. 1:36backtest on this exact strategy. Now, as
50. 1:38you can see, just over the past 2 weeks,
51. 1:40it's only hit two out of five trades.
52. 1:43Now, we're not done testing yet, so we
53. 1:44can go into the settings and adjust our
54. 1:46take profit and stop loss. Let's go
55. 1:48ahead and start by unchecking the 200
56. 1:50EMA filter. And actually, okay, so we're
57. 1:52starting to see more winning strategy.
58. 1:54We got 66% win rate, six wins, three
59. 1:56losses over the past two weeks. If we go
60. 1:58to the settings, let's adjust the risk
61. 2:00reward maybe and see if that does. Maybe
62. 2:02a one-to-one. Wow, so a one-to-one gives
63. 2:04us an 88% win rate going eight-to-one
64. 2:07this past week on trades. That seems to
65. 2:09be quite optimal. Now, you'll be able to
66. 2:11further backtest this soon inside of Lux
67. 2:13Algo Quant, but if you want to do some
68. 2:15deep backtesting, you have the entire
69. 2:17Pine Script strategy right here that you
70. 2:19can copy, bring over to TradingView, go
71. 2:21to the Pine Editor, and create new
72. 2:24strategy. From here, you delete
73. 2:26everything in that chat, and then you
74. 2:27paste in the strategy, and we can go and
75. 2:29backtest it on further data. After
76. 2:31running through multiple setting types,
77. 2:33what we discovered is not using the 200
78. 2:35EMA filter and an ATR of a one-to-one
79. 2:38risk reward, but at a two multiplier.
80. 2:41This turns into a really nice strategy
81. 2:42for the past 3 months. You can see a 54%
82. 2:44win rate with a only 2.6k drawdown and
83. 2:487k net profit. But, if you want to try
84. 2:50it yourself completely free, I want to
85. 2:52send you the link to this chat with the
86. 2:54exact source code. All you have to do is
87. 2:56comment trend, and I'll send you the
88. 2:58link.