Improvise, Adapt, Overcome.

TL;DR

1. Missing out on many potentially good trades!
2. These trades align perfectly with my current strategy.
3. Improve my current trading strategy by adding these trades.
4. I will be adding this improved version to my signal group!

Disclaimer: I am not a financial advisor. The content for this article is purely for educational/research purposes only and is merely based on my personal opinions.

Please note: There will be affiliate links in this article. But it will only benefit both of us. If you do not wish to participate under my affiliate links, please feel free to Google them separately. Cheers!

I’ve been trading Gold (XAUUSD) for about a year now, closely monitoring the chart and managing my trades. Recently, I made an observation that could potentially increase my income. Let me explain.

Missing Out On Many Potentially Good Trades!

Those in my trading group would know that my strategy used to include only one trade per day on Gold (XAUUSD). The entry is set at the 38.2% Fibonacci level, with a stop loss at 0% and a take profit at the 127.2% Fibonacci level. While this strategy is generally effective, I’ve noticed that there are days when the price doesn’t retrace far enough to trigger my limit order at the 38.2% level. This results in missing out on opportunities when the price moves in the expected direction.

This trade was one of several missed opportunities. The price didn’t retrace sufficiently to trigger my limit order at the 38.2% Fibonacci level. Instead, it quickly rose to my take profit level at 127.2% after touching the 50% Fibonacci level. This trade potentially could earn me around 1.25R per trade.

Improve Trading Strategy By Implementing A Second Trade.

I’ll be incorporating these additional trades into my upcoming trading strategy. They seamlessly align with my current trading strategy and does not have any impact on my trading system. In addition, I will modifying the take profit level to maximum the returns.

In future trade signals, there will be two trades. Trade №1 will occur at the 38.2% level, and Trade №2 will be at the 50% level. Both trades will have a Stop Loss at 0%, Take Profit 1 at 100%, and Take Profit 2 at 127.2%.

I will be adding this improved version to my signal group!

To my Signal group members, I’ll be including this additional trade idea in my future newsletters. However, as always, please remember that these are not financial advice. It’s entirely your decision whether to follow these trade ideas. I’ll be taking the same trades myself.

Backtest Results

I did a detailed backtest for this new strategy for the whole of year 2023. Here are some results.

Capital: $10,000

Risk per trade: 1% ($100)

Total Trade: 301, Win: 156, Lose: 145; Win Rate: 51.83%

Total Returns: $7400 (74%)

Aerage Monthly Returns: ~6% Per month

Comparison To Current Trading Strategy

While my current strategy has a lower total return but a high win rate, I’m focusing more on maximizing returns. Therefore, I’ll favour a strategy that offers higher returns.

Previous Win rate: 61%

Previous Total Returns: $4200 (42%)

Previous Monthly Returns: 3.55%

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