Summary
Highlights
A highly profitable trading strategy that gained 130% in two months is introduced. It uses two free TradingView indicators, is easy for all markets, and further secrets for optimization and backtest results will be shared.
Access TradingView and select any security (e.g., Doge). Add the Double Exponential Moving Average (DEMA) indicator. The DEMA provides faster signals with less lag compared to a standard EMA, which is beneficial for this strategy. Adjust the DEMA's length to 200 and change its color to blue for clarity.
Add the Supertrend indicator from TradingView. Set the ATR period to 12 and the ATR multiplier to 3 for optimal performance with this strategy.
For a long trade (e.g., DOGE/USD on a 15-minute timeframe), the price must be above the 200 DEMA (blue line). Wait for the Supertrend indicator to give a buy signal, and ensure the buy signal candle closes before entering. Set the stop loss at the Supertrend's buy signal line. The exit strategy is to sell only when the Supertrend indicator gives a sell signal, allowing for potentially unlimited profit.
For a short trade, the process is reversed. The price must be below the 200 DEMA. Wait for a sell signal from the Supertrend. Enter after the sell signal candle closes, set the stop loss at the Supertrend's sell signal line, and exit when the Supertrend gives a buy signal.
If the price is below the DEMA but a buy signal appears, wait for the price to cross above the 200 DEMA before entering. This method opens up more trading opportunities that might otherwise be missed.
Consider adding Fibonacci Bollinger Bands (FBB) to the strategy. Uncheck all FBB boxes except those with '1's and set the colors to red. These lines act as absolute highs and lows. If the price touches a red FBB line, sell immediately, even if the Supertrend still shows a buy signal, as prices often reflect off these bands. This can lead to increased profitability, although it wasn't part of the main backtest.
The strategy was backtested using Doge/USD and LTC/USD, completing 100 trades over 2.5 months. It yielded a 130.14% profit with a 60% success rate (60 wins, 40 losses). The maximum consecutive wins were 8, and consecutive losses were 3, indicating a robust strategy. Information on how to backtest strategies on TradingView is also provided.