Yet another simple trading system

Hi folks, first post here. Got a little system you might be interested in that I'm currently forward testing, lmk your thoughts. I think I'm just getting to the point of consistent profitability so please take anything I say regarding trading with a pinch of salt, I'm far from experienced and/or knowledgeable about the markets. Also if there are any generous computer big brains out there who can code this into a ctrader or Mt bot I would be forever grateful (I can't spare funds to pay for this just now I'm afraid

Please keep the thread on topic, clean, and only unformatted text

The strategy:
Us30 m1 & m3 (other indices look promising too)
Trade only first 2 hours of nyse open
21 period rsi
Long entry: wait til Rsi crosses and closes over 50 from bottom to top, that candle closure is your ignition candle, enter a buy on break of the high +3 points, SL low - 3 points.
Short Entry: opposite of long
Tp: kinda depends on the size of the ignition candle, 1:2rr is generally doable, I've back tested upto 1:20

Some days may range a bit and get you chopped up so it's a good idea to limit the amount of trades you take if you keep losing but generally Us30 has a good couple of swings in a day which you should be able to get in on early with this entry method.
One other thing I've learnt is that volume should carry the trade fairly quickly after printing the ignition candle, like within 15 seconds if not you may end up with a retest of the 50 Rsi and a pullback beyond your sl.

I'll post some trades when I get some time at the screen

I didn't trade yesterday but here are the backtest results with ignition candles highlighted and potential rr for each trade.

Hi ninjadave, why is the RSI set at 21 periods? How did you derive the +3/-3 range for entry and stop?

I find the higher Rsi period tends to cut out some low quality signals. See the uploaded pic to compare the 21 with the 5 on the same day I posted above. Maybe if you adjusted your profit taking to 1:1 it could work but i prefer to try for the higher reward setups. Saying that, the 5 would have given an earlier entry on that big short at 10am EST.

Since the price moves so fast at low time frames I'm generally entering market orders by eye slightly above or below the ignition candle +/- 3 points isn't a hard and fast rule.

Tue was pure gash for me, usd red folder caused a lot of chop creating a lot of false signals earlier on, after losing a few trades and the will to live for the hundredth time I turned off the computer which was of course when 2 viable signals showed up.

Lessons learnt?
Don't trade near red news (I knew this already)
Don't keep ploughing in good money after bad (I knew this already)
One day I'm going to use all the theoretical knowledge I'm learning.

If a trading system is good it does not care too much about the news, whether it is red orange or yellow, I think it is more of a problem at the discretionary level because of the high volatility that makes it difficult to identify the correct timing for order entry. Everyone has bad days and turning off the pc seems like a good solution to me, what happens next is irrelevant, so you did the right thing at the right time.

I think you're right mate, tbh I think it was equally possible that the news gave a signal and followed through with a 400 point move but due to my inexperience I didn't clcok what was happening before chasing the price up and down for half an hour which battered my confidence.

Thanks for the advice

If you have chosen to go the discretionary trading route one solution might be to implement a volatility indicator of your choice, this should help keep you away from those time periods that prevent you from trading calmly. But the choice of indicator and its settings is not simple as it requires time and a lot of practice, in your case the use of a backtest to derive such settings should be ruled out. The ultimate goal should not be the realization of x100 profits but the preservation of mental energy for when the conditions are there to trade.

Hi ninjadave I premise that I don't like this financial instrument and I don't know it but never mind, studying the MYM futures I tried to keep your settings with RSI observing the volume this week. Without much effort I filtered on a daily basis only the trades with good volume. It seems to me a condition from tight TP and SL so I made a test whose equity is in the second attachment.
Greetings

Generally these kinds of very simple trading systems only work with discretion and won't work when you try and code them up.

Here are the results from a cTrader automated backtest of a years worth of tick data.
I've placed the stop loss at the other extreme of the signal candle, other than that it's as you described in your first post, with a RR of 2.

As you can see it does perform better more recently but I probably wouldn't take too much stock in that for the long term.

If you want to try and improve a system like this from a mechanical standpoint you could try filtering by volume > (average of last X bars * Y) and/or candle body > (average of last X bars * Y) maybe.
You could also try adding a rule regarding the max number of losses in a day, just a couple of ideas.

Perfect here, having read the first post you already have enough information to understand that there is no hedge in the long run by coding the system and you have shown that, that is why I had recommended avoiding backtest to derive certain settings, keeping discretion predominant is essential. I therefore showed ninjadave a way by keeping his basic idea but removing the risk:reward ratio and replacing it with more flexible targets and stop losses designed for MYM. I also used the same RSI to identify momentum conditions. I think ninjadave did not get the information he would have liked, but he got some very good ones.