Strategies / Momentum / Reversal Pattern With Smoothed Stochastic

Reversal Pattern With Smoothed Stochastic

The system buys when a stochastic-based close reversal agrees with a double smoothed stochastic trigger line above 80 and above its main line, and sells short on the mirror condition below 20. Positions close when the states disagree.

MomentumLong & shortIntradayGold30 min

n/aProfit factor

1,776Net profit EUR

38.31%Win rate

4,007Trades

-1,289Max drawdown

0.44Avg trade

Best run of 10. Gold, 30 min, spread 0.6, from run sweeps:2026-10-12-GOLD-30m-opt.tsv:9.

Entry rules, long

The close is above the prior close, and the prior close was below the close 2 bars earlier.
The Stochastic %K (14 periods) is below its 3-period SMA and above 50 on the same bar.
When both states are bullish and no long is open, the system buys 1 contract at market.

Entry rules, short

The close is below the prior close, and the prior close was above the close 2 bars earlier.
The Stochastic %K (14 periods) is above its 3-period SMA and below 50 on the same bar.
When both states are bearish and no short is open, the system sells 1 contract short at market.

Exit rules

When they no longer agree, an open short is bought back at market.

Test conditions

Period	Up to 2026-10-12
Instrument	Gold, 30 minutes
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	2026-10-12

Every run

Markets and timeframes tested

Market	Timeframe	PF	Trades	Win %	Net	Max DD
GoldBest run	30 min	n/a	4,007	38.31	1,776 EUR	-1,289
USD/JPY	Daily	n/a	254	42.13	1,288,390 USD	-533,800
USD/JPY	30 min	n/a	3,994	42.06	388,220 USD	-309,000
USD/JPY	1 hour	n/a	2,849	42.75	292,530 USD	-251,500
Silver	1 hour	n/a	2,349	38.27	29,739 USD	-11,809
Nikkei 225	Daily	n/a	213	38.97	23,266 USD	-14,976
Brent Crude	Daily	n/a	99	43.43	20,011 EUR	-5,088
US Crude Oil	Daily	n/a	205	45.85	19,117 EUR	-5,989
GBP/USD	1 hour	n/a	3,558	41.60	9,163 USD	-2,696
Gold	1 hour	n/a	2,477	39.69	2,056 EUR	-881

Charts

Results by run

Net profitMax drawdown

The code

ProBuilder code, as tested

// ==============================================================
// Reversal Pattern With Smoothed Stochastic
// ProRealAlgos Strategy Library  |  prorealalgos.com
// Type: Momentum
// Direction: Long & short
// Timeframe tested: 30 minutes
// ==============================================================

DEFPARAM CumulateOrders = false

ONCE posrev = 0
ONCE sincebad = 1000
ONCE postwo = 0
ONCE rawk = 50
ONCE stochb = 50

ll = lowest[14](low)
hh = highest[14](high)

59 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

EMAStochastic

Read this firstKnown weaknesses3 points

No profit factor is available, because only sweep results exist for this strategy.
The maximum drawdown of 1,289 EUR is large next to the net profit of 1,776 EUR.
The code sets no stop loss, so a losing trade stays open until an exit signal arrives.

Questions

About this strategy

Can I run Reversal Pattern With Smoothed Stochastic 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 by trade count was Gold, 30 minutes, with 4,007 trades.

How large was the drawdown?

The best run had a maximum drawdown of 1,289 EUR at the tested position size, against a net result of 1,776 EUR.

Does it trade long, short or both?

It trades both long and short.

Reversal Pattern With Chaikin Volatility

Uses the same indicator.

2.26 PF · 6,872 trades

CCI Breakout

Best run on the same market, Gold.

1.08 PF · 6,065 trades

ATR Momentum

Also a momentum strategy.

n/a PF · 15,021 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