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Strategies / Momentum / Reversal Pattern With Dynamo Oscillator

Reversal Pattern With Dynamo Oscillator

Buys when a reversal pattern on closing prices and a smoothed stochastic oscillator both point up, and sells short when both point down. Any open position is closed when the two signals disagree.

MomentumLong & shortSwingUSD/JPYDaily
1.67Profit factor
2,263,860Net profit USD
44.26%Win rate
235Trades
-483,010Max drawdown
9,633Avg trade

Best run of 10. USD/JPY, Daily, spread 1, from run pf:2026-10-12-USDJPY-D.tsv:54.

Entry rules, long

  2. Dynamo state is +1 when the Dynamo value is above 77, -1 when it is below 23, and otherwise unchanged.
  3. The system buys one contract at market when both states are +1.

Entry rules, short

  2. Dynamo state is -1 when the Dynamo value is below 23, and +1 when it is above 77.
  3. The system sells short one contract at market when both states are -1.

Exit rules

  2. A short closes when the two states no longer both point down.
  3. There is no stop or target.

Test conditions

PeriodUp to 2026-10-12
InstrumentUSD/JPY, Daily
Spread1 points
Starting capital1,000,000
CostsSpread only. Commissions and overnight financing are not included.
BarsUp to 200,000 bars, fewer where the instrument has less history
Last tested2026-10-12

Every run

Markets and timeframes tested

MarketTimeframePFTradesWin %NetMax DD
USD/JPYBest runDaily1.67 23544.262,263,860 USD-483,010
USD/JPY1 hourn/a 2,31440.75384,390 USD-239,300
Nikkei 225Dailyn/a 21045.2420,851 USD-13,508
Brent CrudeDailyn/a 9442.5517,260 EUR-8,682
Nasdaq 100Dailyn/a 20739.618,249 EUR-6,998
DAX 404 hoursn/a 55242.396,966 EUR-5,336
DAX 4030 minn/a 3,43639.526,026 EUR-5,299
Gold1 hourn/a 2,06139.011,872 EUR-853
Gold4 hoursn/a 55240.581,739 EUR-759
GoldDailyn/a 23136.801,231 EUR-955

Charts

Results by run

Net profitMax drawdown

The code

ProBuilder code, as tested

// ==============================================================
// Reversal Pattern With Dynamo Oscillator
// ProRealAlgos Strategy Library  |  prorealalgos.com
// Type: Momentum
// Direction: Long & short
// Timeframe tested: Daily
// ==============================================================

DEFPARAM CumulateOrders = false

ONCE kfast = 0
ONCE kosc = 0
ONCE posrev = 0
ONCE posdyn = 0
ONCE lowsofar = 9999999
ONCE highsofar = 0

rngf = highest[14](high) - lowest[14](low)

54 more lines: the entry and exit rules.

Setup

How to load it

  1. Copy the code with the copy button on the code block.
  2. 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".
  3. Paste the code, give the system a name and save it.
  4. Click "Backtest", set your own spread and position size, and run it before you consider trading it live.

Indicators used

SMAStochastic
Read this firstKnown weaknesses2 points
  • Results include the spread only. Commissions and overnight financing are not included.
  • The code is published as it was backtested and has not been compiled again since.

Questions

About this strategy

Can I run Reversal Pattern With Dynamo Oscillator 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 10 market and timeframe combinations. The best run was USD/JPY, Daily, with a profit factor of 1.67 over 235 trades.

How large was the drawdown?

The best run had a maximum drawdown of 483,010 USD at the tested position size, against a net result of 2,263,860 USD.

Does it trade long, short or both?

It trades both long and short.

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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.comStatsDocs