Strategies / Momentum / Stochastic Reversal With KST Momentum

Stochastic Reversal With KST Momentum

The strategy buys at market when the stochastic reversal state is bullish and a weighted sum of four smoothed rate of change readings is positive, and sells short when both are bearish with that sum negative. Positions close when the two states disagree.

MomentumLong & shortSwingUSD/JPYDaily

1.87Profit factor

3,039,770Net profit USD

41.47%Win rate

299Trades

-497,700Max drawdown

10,166Avg trade

Best run of 13. USD/JPY, Daily, spread 1, from run pf:2026-10-12-USDJPY-D.tsv:33.

Entry rules, long

The KST state turns bullish when its weighted sum of rate of change readings over 6, 10, 15 and 20 bars is above 0.
A long opens at market when both states are bullish and no long position is open.

Entry rules, short

The KST state turns bearish when its weighted sum of rate of change readings over 6, 10, 15 and 20 bars is below 0.
A short opens at market when both states are bearish and no short position is open.

Exit rules

An open short closes at market when the two states are no longer both bearish.

Test conditions

Period	Up to 2026-10-12
Instrument	USD/JPY, Daily
Spread	1 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
USD/JPYBest run	Daily	1.87	299	41.47	3,039,770 USD	-497,700
USD/JPY	1 hour	n/a	3,237	37.13	625,610 USD	-303,370
USD/JPY	30 min	n/a	4,564	35.56	535,400 USD	-203,970
USD/JPY	10 min	n/a	4,709	34.53	226,120 USD	-174,860
Brent Crude	Daily	n/a	114	37.72	13,884 EUR	-8,523
US Crude Oil	Daily	n/a	255	38.43	11,840 EUR	-9,683
DAX 40	30 min	n/a	4,670	35.29	10,885 EUR	-5,773
US Crude Oil	1 hour	n/a	2,057	36.51	6,729 EUR	-4,652
Gold	1 hour	n/a	2,799	34.41	2,490 EUR	-793
Gold	4 hours	n/a	709	36.39	2,126 EUR	-846
Gold	Daily	n/a	315	39.37	1,814 EUR	-971
S&P 500	Daily	n/a	332	35.84	1,721 EUR	-1,583
Gold	30 min	n/a	4,650	33.18	1,529 EUR	-1,265

Charts

Results by run

Top 10 of 13 runs. The full list is in the table above.

Net profitMax drawdown

The code

ProBuilder code, as tested

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

DEFPARAM CumulateOrders = false

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

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

61 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

StochasticSMA

Read this firstKnown weaknesses2 points

The code sets no stop loss, so a losing trade stays open until an exit signal arrives.
Results include the spread only. Commissions and overnight financing are not included.

Questions

About this strategy

Can I run Stochastic Reversal With KST Momentum 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 13 market and timeframe combinations. The best run was USD/JPY, Daily, with a profit factor of 1.87 over 299 trades.

How large was the drawdown?

The best run had a maximum drawdown of 497,700 USD at the tested position size, against a net result of 3,039,770 USD.

Does it trade long, short or both?

It trades both long and short.

Trend Surfer

Uses the same indicator.

1.04 PF · 10,813 trades

EMA 8 21 RSI Filtered Bracket

Best run on the same market, USD/JPY.

1.09 PF · 6,194 trades

MACD RSI Volume Confirmation

Also a momentum strategy.

1.89 PF · 187 trades

Want strategies that are already part of a live portfolio? Join the ProRealAlgos waitlist.

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.com Stats Docs