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Strategies / Pattern / Reversal Pattern With Volume Oscillator

Reversal Pattern With Volume Oscillator

Pairs a reversal state built from a stochastic with a volume oscillator, the difference of 34 and 55 period EMAs of trend-signed volume. It buys when both states are up, sells short when both are down, and closes any position when they disagree.

PatternLong & shortSwingDAX 404 hours
n/aProfit factor
6,817Net profit EUR
39.71%Win rate
1,385Trades
-3,571Max drawdown
4.92Avg trade

Best run of 1. DAX 40, 4 hours, spread 3, from run sweeps:2026-10-11-DAX40-4h-opt.tsv:70.

Entry rules, long

  2. Trend-signed volume is 100 times volume when typical price rises, and minus 100 times volume when it falls.
  3. The volume state turns up when the EMA(34) minus EMA(55) oscillator is above its 13-period EMA.
  4. A long is opened at market when both states are up and no long position is open.

Entry rules, short

  2. The volume state turns down when the oscillator is below its 13-period EMA.
  3. A short is opened at market when both states are down and no short position is open.

Exit rules

  1. A position closes at market when the two states disagree.

Test conditions

PeriodUp to 2026-10-11
InstrumentDAX 40, 4 hours
Spread3 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 tested2026-10-11

Every run

Markets and timeframes tested

MarketTimeframePFTradesWin %NetMax DD
DAX 40Best run4 hoursn/a 1,38539.716,817 EUR-3,571

Charts

Results by run

Net profitMax drawdown

The code

ProBuilder code, as tested

// ==============================================================
// Reversal Pattern With Volume Oscillator
// ProRealAlgos Strategy Library  |  prorealalgos.com
// Type: Pattern
// Direction: Long & short
// Timeframe tested: 4 hours
// ==============================================================

DEFPARAM CumulateOrders = false

ONCE posrev = 0
ONCE sincebad = 1000
ONCE postwo = 0

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

57 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

StochasticSMAEMAVolume
Read this firstKnown weaknesses4 points
  • No profit factor is available, because only sweep results exist for this strategy.
  • The maximum drawdown of 3,571 EUR is large next to the net profit of 6,817 EUR.
  • It was only tested on DAX 40, so there is no evidence from other markets.
  • 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 Volume 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 one combination, DAX 40, 4 hours, with 1,385 trades.

How large was the drawdown?

The best run had a maximum drawdown of 3,571 EUR at the tested position size, against a net result of 6,817 EUR.

Does it trade long, short or both?

It trades both long and short.

Related

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Heikin Ashi Color Flip

Best run on the same market, DAX 40.

1.12 PF · 3,692 trades

Breakout Reversal

Also a pattern strategy.

n/a PF · 459 trades

See how ProRealAlgos combines strategies like this into one automated portfolio.

The ProRealAlgos community gets the full rules, the complete code and the automated portfolio.

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