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Throughout the 17-month backtesting period, our highly refined trading algorithm showcased its skill in identifying and capturing profitable trades, achieving a remarkable win rate of 73%. The average trade duration was 1 hour and 12 minutes, reflecting the algorithm's focus on efficiently capitalizing on short-term market trends.
During the backtest, the total return reached an impressive $26,444, while the maximum drawdown was limited to $614, or 6.14% of the initial balance. These figures highlight the algorithm's expertise in maintaining a balance between risk and reward, ensuring a more stable and controlled trading experience.
The algorithm's performance is further underscored by a strong Sharpe ratio of 6.82, indicating a robust risk-adjusted return. The risk-reward ratio remains favorable, with the average winning trade generating $127 in profit and the average losing trade resulting in a loss of $88. The profit factor of 3.89 demonstrates the algorithm's capacity to produce returns that are 3.89 times greater than its losses.
In summary, our algorithm has demonstrated exceptional performance in the USD/CAD 5-minute backtest conducted from December 2021 to April 2023. These results emphasize the algorithm's ability to generate consistent profits, effectively manage risk, and capitalize on short-term market opportunities. It is crucial to remember that past performance may not always be indicative of future results, and real trading conditions can vary due to factors such as slippage, commissions, and other trading expenses.
