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Strategies / Mean reversion / Stochastic Oversold Scalp Long

Stochastic Oversold Scalp Long

Buys a short-term dip when the open is below the 5-period average of lows, ADX is above 30 and the stochastic %K crosses above %D below 30. Sells when open is at or above the 5-period average of highs or stochastic crosses above 70.

Mean reversionLong onlyIntradaySilver3 min
n/aProfit factor
4,852Net profit USD
59.57%Win rate
1,217Trades
-4,665Max drawdown
3.99Avg trade

Best run of 10. Silver, 3 min, spread 2, from run sweeps:2026-10-04-SILVER-3m-opt.tsv:13.

Entry rules, long

  1. The open is below the 5-period exponential average of lows
  2. The 14-period ADX is above 30
  3. Fast stochastic %K (5 periods) and %D (3-period average) are both below 30

Exit rules

  2. Or fast %K or %D crosses above 70
  3. A stop loss sits 4% below the entry price
  4. A profit target sits 1% above the entry price

Test conditions

PeriodUp to 2026-10-04
InstrumentSilver, 3 minutes
Spread2 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 tested2026-10-04

Every run

Markets and timeframes tested

MarketTimeframePFTradesWin %NetMax DD
SilverBest run3 minn/a 1,21759.574,852 USD-4,665
EUR/USD4 hoursn/a 43566.9033,013 USD-10,375
EUR/USDDailyn/a 9671.8817,762 USD-13,587
Nikkei 225Dailyn/a 8886.365,959 USD-1,828
Nasdaq 1004 hoursn/a 28969.202,532 EUR-1,182
SilverDailyn/a 8979.781,154 USD-992
S&P 5004 hoursn/a 27871.22612 EUR-548
S&P 500Dailyn/a 7780.52370 EUR-264
GoldDailyn/a 11375.22358 EUR-108
Gold4 hoursn/a 27566.55299 EUR-285

Charts

Results by run

Net profitMax drawdown

The code

ProBuilder code, as tested

// ==============================================================
// Stochastic Oversold Scalp Long
// ProRealAlgos Strategy Library  |  prorealalgos.com
// Type: Mean reversion
// Direction: Long only
// Timeframe tested: 3 minutes
// ==============================================================

DEFPARAM CumulateOrders = false

emahigh = ExponentialAverage[5](high)
emalow = ExponentialAverage[5](low)
hh = Highest[5](high)
ll = Lowest[5](low)
fastk = 0

20 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

ADXEMAStochasticSMA
Read this firstKnown weaknesses2 points
  • No profit factor is available, because only sweep results exist for this strategy.
  • The maximum drawdown of 4,665 USD is large next to the net profit of 4,852 USD.

Questions

About this strategy

Can I run Stochastic Oversold Scalp Long 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 Silver, 3 minutes, with 1,217 trades.

How large was the drawdown?

The best run had a maximum drawdown of 4,665 USD at the tested position size, against a net result of 4,852 USD.

Does it trade long, short or both?

It only takes long trades.

Related

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Trend Surfer

Uses the same indicator.

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SMA Crossover With RSI Exit

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2.13 PF · 8,999 trades

ATR Band

Also a mean reversion strategy.

10.31 PF · 53 trades

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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