I Tested 99% Win Rate Scalping Strategy and Built a TradingView Buy Sell Indicator with Pinescript

Summary

In this video, the creator codes and backtests a popular 99% win-rate scalping strategy called 'Super Smart 5-Minute Scalping' by J Monopoly. The strategy uses two indicators—UTB and STC—and follows specific entry and exit rules based on these indicators' signals. After coding the strategy in Pine Script, the creator tests it on TradingView, adjusting settings such as stop-loss and take-profit values. The strategy is backtested across various timeframes to assess its performance, revealing that higher timeframes tend to yield better results. Viewers are encouraged to try the strategy and share other strategies for testing.

Takeaways

• 😀 The video demonstrates how to code and backtest a popular YouTube trading strategy with a 99% win rate called 'Super Smart 5-Minute Scalping Strategy' by J. Monopoly.
• 😀 The strategy relies on two key indicators: UTB for buy/sell signals and STC for overbought/oversold conditions.
• 😀 The strategy's buy condition requires the STC to be below 25 and turning green, with a buy signal from UTB.
• 😀 For a sell signal, the STC must be above 75 and turning red, with a corresponding sell signal from UTB.
• 😀 The stop-loss is based on the recent swing low for buy signals and swing high for sell signals, with take-profit set to a risk/reward ratio (e.g., 1:1 or 1:2).
• 😀 The video includes coding the strategy in Pine Script on TradingView, allowing automatic alerts and backtesting results.
• 😀 Backtesting is performed on different time frames, including 5-minute, 15-minute, 30-minute, 1-hour, and 4-hour, to assess the strategy's performance.
• 😀 Lower time frames (e.g., 5-minute) yield suboptimal results due to frequent market noise, making higher time frames like 4-hour more effective for the strategy.
• 😀 The creator optimizes the strategy by adjusting parameters like stop-loss methods (swing high/low, ATR, percentage-based) and risk/reward ratios.
• 😀 The strategy shows better results with a risk/reward ratio of 1:1 or 1:1.5, while higher ratios (e.g., 1:2) reduce win rates but increase profits.
• 😀 The video serves as an introduction to coding and backtesting trading strategies using TradingView's Pine Script, helping traders understand how to refine strategies through optimization.

Q & A

What is the main purpose of the video?

The main purpose of the video is to code and backtest a popular trading strategy called the '99% Win Rate Super Smart 5-Minute Scalping Strategy' by J. Monopoly. The video aims to provide a detailed demonstration of how to implement and test this strategy using TradingView's Pine Script.

Why does the video creator emphasize the importance of backtesting the strategy?

The video creator emphasizes backtesting because it helps assess the performance of a trading strategy before using it in real market conditions. Backtesting allows traders to understand how the strategy performs historically and whether it's reliable under various market conditions.

Which two indicators are used in the '99% Win Rate Super Smart 5-Minute Scalping Strategy'?

The two indicators used in the strategy are the UTB (which gives buy and sell signals) and the STC (which works like the RSI and helps determine buy and sell opportunities based on specific thresholds).

What are the entry conditions for a buy trade in this strategy?

For a buy trade, the STC must be below 25 and turn green. At the same time, the UTB must give a buy signal. A buy order is placed after the closing of the candle, with a stop loss set at the recent swing low.

What are the entry conditions for a sell trade in this strategy?

For a sell trade, the STC must be above 75 and turn red. Additionally, the UTB must give a sell signal. A sell order is placed after the closing of the candle, with a stop loss set at the recent swing high.

How does the video creator suggest setting the stop loss?

The stop loss can be set based on the recent swing high or low, or alternatively, a fixed percentage or ATR-based stop loss can be used. The video creator suggests experimenting with these settings to determine the most effective stop loss strategy.

What time frame does the video suggest for optimal performance of the strategy?

The strategy performs best on higher time frames such as the 1-hour or 4-hour charts. The video creator finds that lower time frames like 5 minutes or 15 minutes are not as effective due to more frequent market fluctuations.

What risk-to-reward ratio does the video creator recommend?

The video creator recommends a risk-to-reward ratio of 1:1 or 1:1.5 for this strategy. A higher ratio, such as 1:2, may result in fewer trades and lower win rates, especially on lower time frames.

What did the creator conclude about the strategy's effectiveness on lower time frames?

The creator concluded that the strategy doesn't perform well on lower time frames like 5-minute or 15-minute charts. However, it yields more reliable results on higher time frames like 4-hour charts, despite still being an average performer.

What is the key takeaway from the video for viewers who want to use this strategy?

The key takeaway is that viewers can use the provided Pine Script to automate alerts and backtest the strategy. However, they should test the strategy on higher time frames, optimize settings, and understand that backtesting results will differ depending on various factors, including stop loss and risk-to-reward ratios.