#raynerteo #insidebar #algotrading
Rayner Teo, he shares very useful trading strategies and trading content on his channel and he has more than 2 million subscribers on his youtube channel, so I though I should backtest his trading strategy.
So, in this video, I have backtested his inside bar candle swing trading strategy for 1 year using algo to see if we can really use his inside bar candle trading strategy to capture momentum in a trend and that too at a low risk.
Inside bar candle trading strategy logic:
We will open daily timeframe chart of a liquid stock on trading view, put EMA 10 indicator on it, and when the price moves above EMA 10 indicator, then we will find inside bar candle which is a candle which easily fits inside high and low of the previous candle, thus it is called inside bar candle and the larger bar is called Mother candle. And, as soon as the breakout happens on high of the mother candle, we take BUY trade, with stoploss a notch below low of the inside bar candle and target decided by risk reward ratio of 1:2 to 1:3.
And, we can use the reverse of this trading strategy logic to do short selling, if we were trading on Nifty 50 or any index.
I have backtested this inside bar candle swing trading strategy for 1 year using python code by creating an algo for this strategy and historical data for backtest was taken from dhan broker API.
This swing trading strategy has given an annual return of 52%, 1 lakh was my initial capital, winning trades were 44% and maximum drawdown was 19%.
Now I can convert this swing trading strategy of Rayner Teo into an algo so that trades get executed automatically.
You can follow me on my youtube channel and instagram page whose link is on my youtube channel profile to learn more about algo trading and how to backtest trading strategies.
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#backtesting #backtestingtradingstrategies #algotradingindia #swingtradingstrategy #algotradingstrategies #stockmarket #sharemarket