An update on my $50K weekly gap strategy. Thanks to yesterday's market open, my RMD position gapped down below its SL, so I duly exited as soon as I could after the open (see chart below):
That stoploss took my strategy to 3 losses from the 1st 3 closed trades, as shown in the watchlist below. Not a great start but I recognise that is purely timing luck of when I decided to begin this strategy & where the market happened to be at the time:
The stoploss also reduced the closed trade balance, so that new balance (which occurred just after open) was used to calculate sizing on the 2 entries that were triggered later in the day (see above, balance highlighted in yellow).
I completed my screen, which picked up another 11 setups, one of which triggered an entry yesterday in NWS which of course I missed because of the delayed screen, so I will take that trade on open today.
Also highlighted in yellow is NHF which has been picked up as 2 different gap versions - in cases like this I take the latest / lowest price entry and ignore the duplicate the entry. My backtesting results include such duplicates and while duplicates can amplify returns they can also amplify losses. My preference always is to err on the side of minimising risk / drawdown and I will always sacrifice some return to achieve that, especially when only starting a new strategy.
