These are reversals or early breakout but lots of fake reversal and I don't really know how to filter for range yet. Here you can see up to 5 breakouts but it only buy the first one. Then there is another breakout to the downside, Followed by a false break to the upside, Then Down again ... During period of chops it will buy tops and sell bottoms. Using a moving average don't really help. It's always long or short 1c, That's why it buy 2 and sell 2 I could try to buy / sell, the break of a resistance / support, only if we had a higher low / lower high. I could try using stops. Often chops have equals leg’s length so I could check something with that too.
If you can identify a trend is going up or down that's good. And if you can buy breakouts in a trend that's also good. But you need to combine that with good risk managements like having tight stops before you can't tell when a trend is going to end. If you can tell that then your system is at the next level. But for most people all you can see is that a there's a trend up or down. And best strategy is to just assume a trend will keep on going until it fails. Next level for you might be what criteria are you using to identify breakouts? And what criteria do you use to identify your stops?
Yes at this point it’s more about filtering signals. Tried volume, ATR but it doesn’t help. Thanks for the feedbacks, I’ll check these out tomorrow.
Might also try using higher timeframe analysis but the system doesn’t work on 5min. It’s mainly to gather insights as I am still a discretionary trader but the more I can quantify and backtest, the better.
Trend and breakout should work on 5min charts and multiple time frames. The only difference is there's less signals. And that may be another thing you want to take a look at. What if you use both 5min and 1 min and what would it tell you?
The backtests from the 5min were all losing money but yeah, I agree, there should be no difference. I’ll try to backtest another strategy on the 5min and see how it works. Well I would use the 5min (Higher TF) to filter the signals on the 1min. But everything can be done on the 1min … I mean a 10sma on the 5min is just a ~50 sma on the 1min (with less noise). So yeah I’d use the 5min to denoise (filter) the signals from the 1min. But I might first try to generate less signals on the 1min. More meaningful support and resistance. Then more meaningful breakouts. Try to tinker with stops Avoid false reversals + chops. Let’s see.
I hope you don’t mind my butting in again, but I found I wanted to mention (for what it’s worth, if anything) that I strongly agree with absolutely everything @jinxu has recently said, here. Wishing you well!
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