1) Fit a SuperTrend indicator (By KivancOzbilgic) on a
2) Fit another SuperTrend on a smaller timeframe ( when 1 and 2 are green then , 1 & 2 are red then )
3) Use the TTM Squeeze indicator (By Greeny) to determine entry and exit points
4) Adjust the level of fluctuation you are willing to live with by setting a cap on the ATR level . Your strategy can be 10x more lucrative if you are willing to stomach a 56% drawdown on your account. Reducing the ATR threshold reduces that Max Drawdown but also the profit. It is all about balancing risk with profits.
5) Size the trade positions based on the remaining equity (if your strategy is successful, you’ll benefit from compounding, when it is loosing money, you reduce your exposure so you don’t go bust)
6) Trade with to benefit from leverage
7) Adjust your positions between day and night (the margin requirements are lower during RTH so you can increase your position)
8) Script the whole thing
9) Tweak the parameters of all the above until you get the desired outcome (or until you are sick and tired of it :) )
10) Finally automate the trades by sending the alerts to a webhook URL and send them to your brokerage account using your
Optional: Add safety gates such as Max Drawdown, Max Intraday Loss or Max number of loosing days….
I built a script to quickly play with all the variables as input and back test different scenarios with different chart timeframes and trading windows for the above strategy. The resulting strategy was back tested as far as I could (15 months with the data I have) and the numbers are, what can I say, IMPRESSIVE! The strategy turned 10K into 3,000K with 62% Profitable Trades and 1.8 Profit Factor while keeping the Max Drawdown below 35% over a 15 months period!
Before you ask, no the script does not repaint and yes the result were from a standard candle chart. Finally, commissions are factored in.
I started trading this automated strategy live this week on my margin account using MNQ1! . So far so good… I’ll keep you posted…
Disclaimer: Successful back testing is not a guarantee of future success. Trading involves risk and so does automation. The above is not an investment advice but merely an idea. Do your own due diligence and above all, trade safely and stay safe!