J2S Backtest: Steven Primo`s Big Trend Strategy

2022년 8월 24일

Is it possible to benefit from big trend moves? In this study I present you a strategy that aims to capture big trend moves.

Created by trader Steven Primo, The Big Trend strategy is advocates and shared through his YouTube channel without restrictions.

Note:
This is not an investment recommendation. The purpose of this study is only to share knowledge with the community on TradingView.

What is the purpose of the strategy?
The strategy focuses on capturing the movement of trends, providing an entry signal for both LONG and SHORT positions.

To which time-frame of a chart is it applicable to?
According to the author, it is applicable to any chart in different markets.

What about risk management?
The author does not establish a risk management model for strategy. This is left to the definition of each trader.

How are the trends identified in this strategy?
A 20-periods Bollinger Bands with 0.382 deviation should be plotted on the chart. Prices above the upper band indicate an uptrend, on the other hand, prices below the lower band indicate an downtrend. Finally, prices between the two bands indicate sideways trend.

How to identify a signal for LONG entry?
The signal is given after five consecutive closes above the upper Bollinger band. After that, you must enter the trade after the first trade occurs above the high of the signal bar.

How to identify a signal for SHORT entry?
The signal is given after five consecutive closes below the lower Bollinger band. After that, you must enter the trade after the first trade occurs below the low of the signal bar.

Tips and tricks
In my backtest, I tried to prove the strategy from a position trading perspective, so I proposed use fixed stop-loss and take-profits. The stop-loss is defined as being low of the first bar that generated the movement until the signal bar. The value range from the stop-loss to the signal bar is used in determining the profit target. Given any trade, position closing will be triggered when the bar trading limit is reached.

Backtest features
Backtest parameters are fully customizable, for instance: number of bars inside a trend indicating trend maturity for entry, bar limit for trading entry (after a buy or sell signals). Also, the user chooses to validate only LONG or SHORT entries, or both. It is also possible to determine the specific time period for running the backtests.

Final message
In my tests, I noticed excellent results for other crypto pairs, for example: ETH/USDT, BNB/USDT, FIL/USDT, GALA/USDT and ILV/USDT. Of course, no one strategy works perfectly for every asset, crypto, and bond out there. That's why we should explore each trading model and carry out our backtests. Please, feel free to provide me with any improvement suggestions for the backtest script. Bear in mind, feel free to use the ideas in my script in your studies.