Discretionary Strat

Shared by a BacktestingMax trader on 8 Apr 2026, updated 27 Jul 2026

Any trading strategy that is not 100% systematic (and can therefore be coded and automated) requires some level of discretion to trade. This is developed through experience, often on a non-communicable level such that one person trading a strategy they have experience with can produce wildly different results to a beginner trading the same strategy. My current strategy is mostly discretion based. I also find it works best on more volatile trending markets/assets that tend to breakout more. E.G NQ , USDJPY , Gold

Entry rules

  1. If the chart is wicky, trading gets sticky. If price action is very wicky, consolidating in a way that makes it clear there is not a lot of volume in the market, and/or if there is an upcoming high impact news event, I will not trade. This also applies to when my mentality and mental state is not in a calm place where I can take the time to recognise good trade opportunities, or when I just dont think the chart looks good.

Invalidation

  1. When the chart looks bad, I feel bad, I dont think I can make money and limit risk , and/or when I honestly just do not feel as though trading is the right thing to do at a given time. Remember, Risk to Reward ratio without winrate over a long timespan means nothing.

Stop loss and take profit

  1. Set SL at a level that makes sense, where I am thinking price is more probably going to continue going against me if it goes past that level e.g. a recent low for a long trade. Be a little aggressive with risk unless previously defined, especially when trading a prop firm account or evaluation. Don't be too wide with the SL if it does not make sense to do so. Set TP at a level that makes sense, usually around a 1.5:1 Risk to reward ration, however I do not focus too heavily on R:R and recent winrate. Result of 100 trades, not one.

Author's checklist

  1. Feel zen? Ready to take trades and try our best to go for good opportunities?
  2. No high impact news/heavy swing lows or highs? Done higher Timeframe analysis?
  3. Ready to take good trades and focus on trading process.

Inside the app

Opening this strategy in BacktestingMax shows the full record behind the numbers above, on a free account: every trade with entry, exit, size and P&L plus CSV and Excel export; a bar-by-bar replay of the author's own session on 1-minute history; Monte Carlo projections that reshuffle the trade sequence; the equity curve against buy-and-hold; advanced statistics including Sharpe and Sortino ratios, expectancy, payoff ratio, recovery factor, maximum drawdown and longest time underwater; a day-by-day P&L calendar; and behavioural analysis covering revenge trading, position-size chasing, long/short bias and the hours and days it actually made money.

Open this strategy in BacktestingMax (free account required)

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Figures come from backtests run by the author inside BacktestingMax. Past performance is not indicative of future results, and nothing here is financial advice.