What's the win rate of the Keltner Channels indicator that actually looks better than
the Bollinger Bands indicator? In this video, I'm going to test the Keltner Channels Trading
Strategy 100 times that I talked about in the previous video, to find its win rate and
compare it with other strategies we have tested so far, and to see if it actually makes money
or not. Also, in this video, I have improved the Keltner Channels Strategy a bit more,
because while backtesting, I found out that, instead of taking buy signals at the first
candle that crosses and closes above the upper Keltner Channels Band, it is better to take
a long position when a candle opens and closes completely above the upper Band. And instead
of selling when the first candle crosses and closes below the lower Keltner Channels Band,
it is better to take a short position when the candle completely opens and closes below
the lower Band. By doing this, you will filter some of the false signals that appear in a
choppy market.
Keltner Channels was one of the most interesting indicators I have tested on the Trading Rush
Channel, you will see why in a moment. At the start, when the price was in an uptrend,
it won 10 trades in a row. It not only won multiple trades in a row, but also lost multiple
trades in a row pretty much as soon as the win streak ended. In fact, it lost 17 trades
in a row. If I remember correctly, 17 losses in a row is the highest losing streak we have
seen on the Trading Rush Channel. We have tested many different strategies, but none
of them had anything as high as 17 losses in a row even though they all were tested
on almost the same market structure. But that's not all. As I said, this indicator is one
of the interesting indicators we have tested yet. One might think, after having these many
losses in a row, no way this strategy is going to be profitable, but if you look at the profit
graph, after winning and losing, the profit line went in an upward direction in almost
a straight line. If it had not lost this one trade, the Keltner Channels Trading Strategy
won almost 17 trades in a row.
Keltner Channels gives more signals in a short time period. It made a good profit when the
price was in an uptrend at the start, but when the uptrend ended and the price started
a downtrend, it had a losing streak because it gave multiple signals in a short period
of time near the end of the trend. But here's the thing, many traders in the live market,
add to the position or take more trades when they notice a good trend, or when they are
right about the trend direction. When they win multiple trades in a row, the profit graph
looks similar to the winning streak the Keltner Channels Strategy had in a good trend, but
when you start losing multiple trades in a row, you don't take more trades in the market.
In other words, even though the Keltner Channels had 17 losing trades in a row because it
gave multiple signals near the end of the trend, in the live market, you are most likely
going to stop after getting few losing trades in a row in the same trend.
Because of this, Keltner Channels Trading Strategy that we discussed in the previous
video has a great potential to achieve a higher win rate, as long as you stop taking more
trades in a short time if you have already had around 5 losses in a row.
In this experiment, even after losing 17 trades in a row, it still managed to make money after
100 trades, and got a 49 percent approximate win rate with a 1.5 to 1 reward risk ratio.
In the Trading Rush App, it made a profit of 2250 with an account size of 10000 and
with 1 percent risk per trade of course.
5.8+7+4.5+4+6
And the Keltner Channels Trading Strategy gets a TR Score of 27.3 out of 50. And if
you come to the Official Trading Rush Website, you will see it ranks 17th from the top, just
above the RSI Supertrend Trading Strategy, and below the Bollinger Bands Strategy. Now
it ranks below the Bollinger Bands strategy, because the Bollinger Bands we tested was a
slightly different and difficult strategy, and because the Keltner Channels lost few
points in the reliability and consistent profits category because it had 17 losing trades
in a row. When it comes to the Easy to Use Category, the Keltner Channels easily takes
the lead. Overall, the Keltner Channel is a good indicator with great potential.
That's all.