Hey now. I'm back with an exclusive trading system inspired by a Trader's
Landing Community Member that uses multi-time frame confirmation and produced fantastic
results over a series of 100 trades. Just be sure to stick around to the end when
I show you how to make this strategy even better with my popular optimization tips.
And check out my new channel Crypto Landing where we are pumping out high yield alpha.
Just remember if you are not subscribed then your next trade can wind up like this.
I call this system the Bence Bounce and like most trading systems it can be adapted to Forex,
crypto, options, stocks, indices, or any instrument that has significant volume
and market participants. This trading strategy utilizes two free TradingView indicators,
as always links and settings to all indicators are listed in the description below. The first
indicator is the standard SuperTrend set at default settings and style. The SuperTrend is a
trend following indicator based on the Average True Range and it consists of a single line,
either green for bullish trends or red for bearish trends. This indicator will be placed on the
four hour chart and will be used to determine the higher time frame trend. The second free
TradingView indicator is the standard Stochastic study and it will be used on the 15 minute chart,
inputs will be kept at the fault and I am going to thicken the lines so you can see it more clearly.
The Stochastic study is a popular oscillator with overbought and oversold areas in an
attempt to determine trend reversals. In the Bence Bounce this indicator will be used for
both entry confirmations and triggers. Let's go over enter criteria and review some examples,
as always system rules and details are listed in the description below. This chart is Bitcoin
versus the US Dollar 4-hour candles on the top chart, and 15-minute candles on the bottom chart.
The rules to enter along on the Bence Bounce are, first, we can see that the SuperTrend is in a
bullish phase on the 4-hour chart, then we can see hidden bullish divergence on the 15-minute chart,
a higher low on price and a lower low on the Stochastic.
Third the Stochastic enters the oversold territory. Finally we get a cross up of the
Stochastic, our rules are met when this candle closes that is our trigger candle. The stop is
placed at the immediate previous swing low and target two times risk. And long example one
continues to the target. If you enjoy this content make sure to click that like button. I have one
more long example. The SuperTrend is green on the four hour chart, there is hidden bullish
divergence on the Stochastic, oscillator a lower higher price and a lower low on the indicator.
Third the Stochastic enters the oversold zone, and finally we get a cross up of the Stochastic.
Everything converges on this candle and it serves as our trigger. The stop is placed at
the previous swing low and one to two is our target. And our trade is closed in profit on
this very bullish candlestick. Now we flip to shorts. This is what i will test for shorts.
First we can see the SuperTrend on the four-hour chart is indicating a bearish trend.
Second there is hidden bearish divergence on the 15-minute chart, a lower higher price and
a higher high on the Stochastic. Then we can see the Stochastic goes into the overbought territory.
Finally there is a cross down of the oscillator. Our rules converge on this candle and it serves as
our trigger. The stop is placed at the previous swing high and the target is two times risk.
And after almost stopping out short example one hits the target, I'm going to show you one
more quick short example. The four hour chart is showing a bearish SuperTrend,
there is hidden bearish divergence on the Stochastic, a lower higher price and a higher
high on the indicator. Then we can see the Stochastic enters the overbought territory,
and finally there is a cross down on the oscillator. This is our trigger candle. The
stop is placed at the previous swing high and the target is two times risk. And the final example
crushes the target. I'm going to give you some great ideas on how we can improve this system
along with a Trader's Landing Score and now it's time to do, what I do.
If you enjoy this content hit the like button. Remember this is just 100 tests on one instrument
if you are thinking of using this system please do extensive back and forward testing and be sure to
let our community know what you discover. This system was presented to me by a Traders Landing
Community Member who wanted some help with his trading system, I just added some secret sauce
to it but his system was a great starting off point. If you want to see the original post you
can log on to our Circle Community. This test was done on Bitcoin versus the US Dollar using both 4
hour and 15 minute Japanese candlesticks, it took 7 months to find the 100 setups,
this data set produced a 54 win rate but there is a caveat to that which I will explain in a moment.
Most winners in a row came in at six and that is paired with four consecutive losing setups, which
is not a bad ratio. The maximum drawdown was five percent and the profit factor was an impressive
2.35. Risking two percent per trade the total gain on account was 124 percent minus fees and spreads.
And I have some additional ideas on how to further optimize this particular trading system.
The equity curve here is very impulsive with only two areas of consolidation. Remember this is just
100 tests so you have to make sure to keep testing different time periods on different instruments.
Additionally crypto is highly correlated so if you are a crypto trader your data
set is inherently limited. I give this system a Trader's Landing Score of eight,
because it accounts for the higher time frame trend, uses an oscillator in the correct way,
but the test did not account for spreads and fees which in this particular setup can be problematic,
more on that next. Remember the enemy of great is good I have six ideas on how we can improve
this system. First never blindly follow a trend indicator on this chart. We can see a bearish
SuperTrend, but the market is clearly moving sideways. You always want to confirm what the
indicator is telling you with price action, for me this would be a no trade zone as there are no
lower highs and lower lows. The indicator in this instance is superfluous. Second, when the
market is really trending regular divergence can provide great entry points, on this chart we can
see a very impulsive move to the downside with a consolidation level that comes with standard
divergence, this is a great spot to get in and profit from a very nice trend continuation. The
biggest problem with this system as presented is that the stop loss most of the time is what
I would consider to be too tight especially for exchanges and brokers where the spreads can get
wide. On this chart you can see that a tight stop loss gets wicked out before going in the direction
of the profit target additionally, you can see the exact same thing happen here but in the opposite
direction. There are some strategies you can use to mitigate these kind of stops that plague this
system during my test. First you can use an ATR value of the trigger candle to set your stop,
in addition using an obvious support level as a point of invalidation may be the best way
to go. Furthermore, you can simply put a moving average on the lower time frame chart as a point
of dynamic support. Continuing on combining the higher time frame trend and using a dynamic take
profit method on smaller time frame can really increase your gains over the course of a series of
many trades. Using a sensitive SuperTrend on the lower time frame as an exit signal can yield some
huge results like this one with a phenomenal 1 to 11 risk versus reward. Next, the thing i really
like about this system is the multi-time frame analysis but you can change those up depending
on your trading style. If you are a fast scalper you can combine the one minute with the 15 minute.
If you are a swing trader with limited chart time daily candles and the four hour chart make a great
combination. Most of the best technical traders perform multi-time frame analysis
almost without exception. Furthermore, and this is just my experience but the Stochastic RSI is
usually more responsive to price action than the standard Stochastic especially when trying to spot
hidden divergences. Here we can see the Stochastic RSI gets you into this huge move that the standard
Stochastic misses. Sometimes it is good to use both as I have shown before on other systems
presented on the channel. If you want to talk to me and interact with our community in addition to
supporting the work I am doing here you can do so for free by registering for our Circle Community.
And those who pick up a Preferred or Elite membership will have access to the discussion and
education spaces, in addition to the TradingView automated scripts and a private video on my
personal trading system. Thanks for watching and have a great day, because you deserve it.