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ZulTheTrader Backtest Notes

[Not For Sale]

The Setup

I use this for entries and lookout for confirmation on HTF.

Weekly

We can see a clear break on the weekly. So we marke the break of the resistance and The low that broke the high as support from Current Market Price. From a weekly perspective, there is a sign that sellers are weak at this area and we have strong buyers.

Daily

On the daily we have a strong move down that price may react from previous Resistance. From that orange box above, what can we lookout for on LTF to enter the trade base on weekly storyline-bullish.

4-Hour

H4 gives us a sign that sellers from old prices are still strong. The first break of the new low gives a sign that seller has control over the direction[See Line Chart]. The second break shows more strength from the sellers. From here we need to take note as this can be a pullback or reversal for HTFs. It depends on how Daily candle closes to give us more information but take note on early sign on H4.

1-Hour

After the H4 has showed support broken, mark the H1 support that has broken and all the resistance near the area when the H1 support is broken. For this example and future forward testing, personally in every analysis I do, I will only mark 2-3 fresh resistance as my POI.

Entry-1

The first attempt will be base on the new H1 resistance. When the new low near my entry is broken that is a sign that we can hold this trade.

Entry-2

Entry 2 confirmation was taken from Entry 1 new support broken. So we can try to attempt near old resistance.

To hold trades we need to find valid SBR/RBS respected. What are the things we can lookout for:

RBS:

1. Resistance Breaks Becomes Support

2. New Support formed that breaks New Resistance

3. Price doesn’t close below New Supports(New Low and New Higher Low)

SBR:

1. Support Breaks Becomes Resistance

2. New Resistance formed that breaks New Support

3. Price doesn’t Close below New Resistances(New High and New Lower High)

Daily

Now back to our daily storyline. We had a trade for shorts and we open the daily chart, we see price closes below the new support that has created[See Line Chart]. What tells us? That although weekly is bullish, Daily still has sellers controlling the market and always trade in-line with daily direction before planning/holding weekly trades.

4-Hour

Remember that price can also use either old zones to retest. In the example above why was that SBR tested is because, that old support did break a high which signifies buyers was in control and as what normal traders will do, we enteer at support. But when that support is broken, that gives us a sign that sellers are still in control.

1-Hour

On H1 we can also see something similar to H4. Sellers took buyers, buyers took sellers and last sellers took buyers. Then we find our SBR and Resistance zones for entries. In this backtest, price tested the SBR zone but look at the Circled area. There is a new lower high and price respected in future, the rejection is a good sign to enter and from entry wait for old lows broken before deciding to hold or close.

Weekly

Now let’s break down the Support Become Resistance.

Daily

We see daily has broken the lows. The vertical line shows what price has done inside that week and we will see how LTF behaves inside there.

4-Hour

Base on Daily/Weekly, we would want to take trades to continue the move up. But H4 didn’t give us the confirmation we need. See the 2 circles I marked. No buy structure was formed at the Weekly Line. Until a reversal structure is formed, only then we can mark zones to buy. Else just follow the trend.

Complete of Weekly Break(SBR)

On that week, SBR is confirmed and we change our bias to look for sells instead of buys as from here onwards, Weekly tells us that sellers are in control.

Daily

From here we take a previous new daily high that was created on the week price broke structure on the weekly. Now we look at H4 to find our confirmation.

4-Hour

There are 3 areas we can look for POIs. on CMP near the previous daily highs in the box there is a setup. If you zoom in abit, we can see a small break near the new weekly open. That tells us that sellers are in control and we can use that high as our entry.

1-Hour

H1 we have 2 highs in blue to use as entry. But since the highs are near to each other, what I will do is mark the zone as one zone and the highs wick in that zone as the high of the zone not the structure and when price comes back we can use that new POI as our entry and target previous lows/hold as Weekly has broken structure.

4-Hour

What do we see on H4? We can see that two levels of support broken which initiates that sellers has taken over the market and are in control. On h4 direction will be looking for sells.

POI

Take the 2 highs of the H4 after the break as our POI.

1-Hour

H1 POI, as we can see there are two reaction at/near the POI. The orange circle had a reaction but price is not inside the zone whilst the blue circle was inside the zone and had a better reaction. Although price did wicked above the highs but once it closes below the Resistance Level, price will respect and reverse. Once it reverses, monitor for New lows broken to hold the trade.

Weekly

Now on the weekly we can see price has broken below a previous support which indicated strong sellers are in the market and we should be looking to follow market direction.

Daily

On daily we started the week with a bearish move but we had a break of structure on the second day. What can we see on H4 will determine what trades we should be looking for or take profit at key levels.

4-Hour

On H4 we see that before the previous week closes, there was a BOS[Blue Circle] that showed Buyers came in and broke short-term sellers. This tells us that we can look for short-term buys or long-term if HTF also break previous highs.

1-Hour

On H1 we can use the new low that was formed - that broke H4 structure as our POI. As you can see , price respected the low and we had a rejection. We had a good entry but if we held price to target H4 highs, we will either end up with losses or BE. So what can be done to avoid in this situation. Either As long it’s Blue - Closed[ABC], take 50% and BE or monitor for H1 BOS for reversals.

4-Hour

On H4 we can see that price closes as a body candle close below the previous low. Ideally we want to look for sells. But what happens was, at the same time it broke two resistance indicating buyers came in at that zone.

Daily

On daily we see the daily candle that closes above previous day resistance which gave us the confirmation of the CMP direction.

1-Hour

H1 new low broke new high and that gives us an area to lookout for buys. We have two areas to enter as market is showing strong buyers breaking sellers. As longs as the new lows did not break, we can use the zone as entry after rejection is seen in the POI zone.

Daily

Daily we see price reach a previous high. Remember Weekly storyline is bearish.

Things to take note:

1. Price near weekly BO

2. Price near Daily resistance that BOS

3. Trend based on weekly and daily is bearish

4. Buys was just retracement for HTF move

5. Look for sells in LTF

4-Hour

H4 we see price also reacting on H4 resistance that is in line with Daily/Weekly zones. From here let’s see what we can find our POI.

1-Hour

H1 we see two areas to mark POI on the line chart. We mark those areas and only make it more precise with the candlestick highs. That will be our POI. When price is inside our POI we had two reactions that broke new lows but the second structure respected the POI and price reversed.

Weekly

On the previous sell example, price ended the week with a wick after testing the SBR-W. What should we look out for on the new week before deciding our daily direction. Let’s study.

Daily

Start of the new week we mark SNR levels to take not on reaction. This was what the market has given us to work out with for now. Bias on Daily CMP is bullish until a clear BOS of the lows to go in-line with weekly.

4-Hour

H4 shows that current new support in-line with daily structure is a potential area of support. We can mark that area and look for entries when price reaches below.

1-Hour

H1 refinement of POI base on H4 structure.

15-Minute

M15 personally the first touch would be our entry. The only confirmation we have was the second touch that made the BOS and price moved.

4-Hour

Also take note after price will also respect previous resistance even when it’s broken as there was a BOS recently in CMP and HTF is still bearish.

1-HourH1 reaction in-line with H4 structure.

Things to take note on direction:

1. HTF Weekly & Daily

2. LTF H4/H1

3. POIs only adjust once H4 is confirmed

4. Wait for price to show reaction inside zones

5. Once zones is broken, disregard and wait for Daily/Weekly reaction

6. After HTF has shown it’s direction or bias, re-do H4 & H1 charts

7. Do not rush or get emotional when you hit SL

8. Wait - Analyse - React

Also why I trade gold as gold can bagged us 80 to 100pips minimum per day. Risking 0.5% to 1% per day on a funded account can help you complete your challenge faster and on personal account helps you to built up your equity exponentially.

This ends my backtest notes. Hope it helps any traders out there and hope to hear your name.

See you on the charts, Peace Zul signing off.

ZulTheTrader