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Strategies / Pattern / Stochastic Reversal Key Down Short

Stochastic Reversal Key Down Short

The idea sells short when a 14-bar stochastic %K reversal pattern coincides with a key reversal down bar. The short is closed when that combined condition no longer holds.

PatternShort onlySwingBrent CrudeDaily
n/aProfit factor
2,944Net profit EUR
48.99%Win rate
296Trades
-2,642Max drawdown
9.95Avg trade

Best run of 1. Brent Crude, Daily, spread 3, from run sweeps:2026-10-11-BRENT-D-opt.tsv:64.

Entry rules, short

  2. A key reversal down bar has high above the prior bar's high and close below the prior close
  3. Sells 1 contract short at market when both conditions hold on the same bar and no short position is open

Exit rules

  1. The short is closed at market when the combined condition no longer holds

Test conditions

PeriodUp to 2026-10-11
InstrumentBrent Crude, Daily
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
Brent CrudeBest runDailyn/a 29648.992,944 EUR-2,642

Charts

Results by run

Net profitMax drawdown

The code

ProBuilder code, as tested

// ==============================================================
// Stochastic Reversal Key Down Short
// ProRealAlgos Strategy Library  |  prorealalgos.com
// Type: Pattern
// Direction: Short only
// Timeframe tested: Daily
// ==============================================================

DEFPARAM CumulateOrders = false

ONCE posrev = 0
ONCE sincebad = 1000

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

38 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

StochasticSMA
Read this firstKnown weaknesses4 points
  • No profit factor is available, because only sweep results exist for this strategy.
  • The maximum drawdown of 2,642 EUR is large next to the net profit of 2,944 EUR.
  • It was only tested on Brent Crude, 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 Stochastic Reversal Key Down Short 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, Brent Crude, Daily, with 296 trades.

How large was the drawdown?

The best run had a maximum drawdown of 2,642 EUR at the tested position size, against a net result of 2,944 EUR.

Does it trade long, short or both?

It only takes short trades.

Related

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Breakout Reversal

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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