Strategies / Pattern / Engulfing Candle at Range Extreme

Engulfing Candle at Range Extreme

The strategy buys a bullish engulfing bar at the 7-bar low, or sells short a bearish engulfing bar at the 7-bar high. Each trade has a stop beyond that extreme by ATR(14), and a target at 1.5 times the stop distance.

PatternLong & shortSwingGoldDaily

n/aProfit factor

863Net profit EUR

42.78%Win rate

180Trades

-586Max drawdown

4.79Avg trade

Best run of 2. Gold, Daily, spread 0.6, from run sweeps:2026-10-11-GOLD-D-opt.tsv:124.

Entry rules, long

The previous bar is bearish, closing below its open.
Its low is the lowest low of the last 7 bars, including the current bar.
No position is open, and signals start after the first 15 bars.

Entry rules, short

The previous bar is bullish, closing above its open.
Its high is the highest high of the last 7 bars, including the current bar.
No position is open, and signals start after the first 15 bars.

Exit rules

The target is 1.5 times the stop distance from the entry fill.

Test conditions

Period	Up to 2026-10-11
Instrument	Gold, Daily
Spread	0.6 points
Starting capital	1,000,000
Costs	Spread only. Commissions and overnight financing are not included.
Bars	Up to 200,000 bars, fewer where the instrument has less history
Last tested	2026-10-11

Every run

Markets and timeframes tested

Market	Timeframe	PF	Trades	Win %	Net	Max DD
GoldBest run	Daily	n/a	180	42.78	863 EUR	-586
DAX 40	Daily	n/a	133	42.11	5,371 EUR	-3,968

Charts

Results by run

Net profitMax drawdown

The code

ProBuilder code, as tested

// ==============================================================
// Engulfing Candle at Range Extreme
// ProRealAlgos Strategy Library  |  prorealalgos.com
// Type: Pattern
// Direction: Long & short
// Timeframe tested: Daily
// ==============================================================

DEFPARAM CumulateOrders = false

myAtr = AverageTrueRange[14](close)

19 more lines: the entry and exit rules.

Setup

How to load it

Copy the code with the copy button on the code block.
In ProRealTime, open a chart of the instrument and timeframe you want to test, then open ProOrder > New trading system and choose "Create with programming".
Paste the code, give the system a name and save it.
Click "Backtest", set your own spread and position size, and run it before you consider trading it live.

Indicators used

ATR

Read this firstKnown weaknesses2 points

No profit factor is available, because only sweep results exist for this strategy.
The maximum drawdown of 586 EUR is large next to the net profit of 863 EUR.

Questions

About this strategy

Can I run Engulfing Candle at Range Extreme in ProOrder?

Yes. The code is ProBuilder and runs as an automated ProOrder system. Backtest it on your own account with your own spread and position size before trading it live.

Which markets was it tested on?

It was tested on 2 market and timeframe combinations. The best run by trade count was Gold, Daily, with 180 trades.

How large was the drawdown?

The best run had a maximum drawdown of 586 EUR at the tested position size, against a net result of 863 EUR.

Does it trade long, short or both?

It trades both long and short.

KDJ J Line Momentum Long

Uses the same indicator.

4.17 PF · 6,135 trades

CCI Breakout

Best run on the same market, Gold.

1.08 PF · 6,065 trades

Breakout Reversal

Also a pattern strategy.

n/a PF · 459 trades

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Past backtest results do not guarantee future results. This is not financial advice. Curated and maintained by ProRealAlgos. ProRealTime™ is a trademark of ProRealTime SAS. prorealalgos.com Stats Docs