Backtest results are not indicative of future results.
Backtesting strategies on synthetic data do not give representative results of the strategy. Testing should be done on graphs that reflect actual closing prices.
The TradeMaster Pro indicator displays buy/sell signals that are designed to support the trader’s analysis. Numerous options and combinations are available to help you create your own unique strategies, whether it’s trading with or against the trend, or even catching oversold bounces. These are just a few of the many options! You can easily adapt our indicator to your trading strategy. Below we detail the options for setting up your trading signal.
The settings that affect the algorithm that generates the signal play an important role in the effective use of signals. We provide our users with the ability to change the settings to fit their trading style, but we also provide a variety of methods to easily change the settings.
Each method of changing signal settings is designed to meet the specific needs of our users. It clearly follows that one method will not necessarily be more accurate than another.
It is important to understand that signal indications are generally used for trend confirmation, not for direct entries and exits. Focusing on ease of use of signal settings and using other features of our toolkit will probably be a better decision for you than trying to find the “holy grail” of optimized signal settings and focusing only on following signals.
A few basic concepts:
- Take Profit: profit realization level (target price) where you close part of your position.
- Stop Loss: The invalidation level where you close out (cut your losses) your trade to protect your capital from further losses. Most of the time it also invalidates your trading signal/idea.
- Entry: the entry level of the signal where the entry should be made
You should NOT blindly follow the buy/sell signals. Every day there are messages saying “The indicator is not only giving good signals…”. The indicator is not just a simple “follow the buy/sell signals” indicator. You need to incorporate many other trading techniques into the indicator’s arsenal to make it successful.
We like to see the general direction of the market, so we start the analysis on a larger time frame, for which a weekly or daily time frame is sufficient.
Once you are on this higher timeframe, then check all the tools at your disposal. What do the key metrics in the table do? Is the price near a support or resistance? Are there FVGs and OBs nearby? Are there divergences on the chart?
These are just a few examples of what to look for on these larger time frames. We have written many detailed tutorials on each of these tools. We strongly recommend that you learn about each instrument first before you start trading the indicator.
Once you are familiar with the general direction of the chart on a higher timeframe using the tools listed above, you can then switch to a lower timeframe such as 15m, 30m, 1hr, 3hr and follow the corresponding buy/sell signals there.
For example, if the bullish fair value gap is filled, the breakout probability is considered high, and the data is bullish on the summary chart, then only long trades are executed.
If there are bearish FVGs, a negative % of the breakout probability is seen, and negative data on the summary table, then I only trade short.
Anything in the middle is just noise, and just a choppy market (which we want to avoid).
Hopefully this clarifies a few things about how to use buy/sell signals.
Signal basic settings #
- Script Sensitivity: Sensitivity, affects Rainbow Trend, Trend and Momentum calculations. “Patient” is the swing, “Perceptive” is more of a scalp oriented setting, depending on trading style.
- Global Moving Average Type: You can select the type of moving average that the indicator should use for each function. It will only be switched if the “Override moving average type globally?” option below it is checked.
Which is exactly what it affects:
- Summary table data
- Trend Rainbow
- Color Theme: Here you can choose the predefined chart and indicator theme.
- Custom Start: Allows you to specify the start of calculations, which can be useful to skip old data or to correct the script when dealing with a large number of functions
- Figyelmeztetés: For the signal, this date must be later in time than the first bar of the chart, otherwise the results may be inaccurate!
- TMPro structure: Allows you to further validate the structure calculator with a predefined value, which may result in a different structure. This mainly helps to detect false signals. It is also worth testing your settings with this.
- Cleaner Chart: This feature has been built in to reduce chart overload, where only the most recent and available data is shown on your chart, so that you are not overloaded with historical information and your chart is more transparent.
In this settings section, you can tick the boxes to select the features you want.
- Current Trade: Allow current trade to be displayed
- Backtest: Enable Backtest (statistical table)
- Active Signals Only: Tick this to display only signals that are currently active
- Target Lines: Tick this to allow the display of the signal’s target levels (Entry, TP, SL)
- Hide Once Trade is closed: Hide trades when they are closed based on the conditions you specify.
- Order($): Here you can specify the amount of capital to use for a trade to simulate the statistics in dollars.
- Fee(%): Here you can specify the fee your broker charges for a trade to make more accurate calculations.
- Pip calculation: This is especially important for forex traders. You enable and use pip calculation for signals
Signals exit strategy #
In this category you can set the exit strategy for signals.
The long/short exit conditions will close the long or short signal if a specific condition is met, such as if the position closes with a profit.
Exit strategy conditions are triggered when they are turned on for a given signal (long/short) and when you select the strategy you want to use in the drop-down menu of the EXIT STRATEGY settings section. The default close is when the signal has reached the last TP level ,or the stop loss level.
- Take Profit Or Stop Loss: There are no changes to the signal levels. The price must reach all Take Profit levels or Stop Loss levels to finalize the trade.
- One-Step (automatic): The signal levels vary. The Stop loss is raised as a level. For example. When the price reaches the second Take Profit level, the stop loss is automatically increased to Take Profit 1 level. This continues until the price reaches all the take profit levels or the new stop loss.
- Two-Step (automatic): The signal levels vary. Stop loss is increased as a double level. For example: when the price reaches the second Take Profit level, the stop loss is automatically increased to the entry level. When the price reaches the third Take Profit level, the stop loss is automatically increased to Take Profit 1. This continues until the price reaches all the take profit levels or the new stop loss.
- Three-Step (automatic): The signal levels vary. Stop loss is increased as a triple (3) level. For example: when the price reaches the third Take Profit level, the stop loss is automatically increased to the entry level. When the price reaches the sixth Take Profit level, the stop loss is automatically increased to Take Profit 1 (although the trade is already closed at this point). Giving freedom for price movement to unfold.
- Four-Step (automatic): The signal levels vary. The Stop loss is raised as four levels. For example: when the price reaches the fourth Take Profit level, the stop loss is automatically increased to the entry level. After that, there is no eighth TP Level, so then it either reaches the last TPs or the increased stop loss, and then the trade is closed. This can be modified by other settings. This can be useful if you want to raise the stop much later. Giving freedom for price movement to unfold.
The next two columns can only be set if Break-even is selected in the first drop-down menu.
Break-even settings (more options below): special Stop Loss placement rules to prevent loss after reaching the target price. The [Target] value is the value selected in the third column.
Keep Stop on Entry at [Target]: the Stop Loss is adjusted to the entry price and remains there once the desired [Target] value is reached.
Keep Stop on Break-even at [Target]: The Stop Loss is adjusted to the net profit price (where your position is at 0) and remains there once the trade reaches a certain profit [Target].
Move Stop to Break-even from [Target]: The Stop Loss is adjusted to the net profit price each time a new take profit level is reached.
Accumulation frorn [Target]: The Stop Loss is adjusted to the net zero profit price each time a new profit target is reached.
Set profit realisation levels (TPs) #
Here you can set all the things related to profit realisation levels.
Users can set up take profit and stop loss orders, which allow some degree of money management in the backtest.
It is possible that take profit and stop loss orders are not executed at the exact price set by the user in the table.
First, you can choose whether to place the target prices based on the manual values you enter or automatically from the options you select. It is important to note that manual values will only work if “ENABLE” is NOT checked!!
For automatic target price placement, you can choose between Linear and Exponential versions. Linear is used more in traditional markets or for moderate target prices in low volatility environments. The exponential is mainly used in crypto markets and exponential movements in a strong rising/falling environment. And distance sets the distance between target prices. You may want to adjust this for your trading environment to see which distance target prices will be the most appropriate (you can of course adjust it for your strategy).
First, identify what price movements you want to trade (regardless of the timeframe). Depending on what you are trading (on any timeframe), you can set these values higher or lower to catch the price movements you are looking for. If you are looking for shorter term price movements on these time frames, you may want to consider using a lower distance. If you are looking for longer-term price movements on these time frames, you should use a higher distance.
If you manually set the category to “target placement”, you can set your target price and stop loss levels here. For Manual Target Base type, you can choose what it should calculate based on.
Exit percent: here you can set the percentage of the position that is realized at each target price level. In statistics there can be important differences, so feel free to use it!
This can be ATR (Average True Range): the “N” ATR setting for take profit/stop loss orders from the closing price before the long/short signal is given, where N is a specified multiplier. Average true range settings use a bar period of 200.
%: Each value entered represents a % (example: 1 = 1%, 10 = 10%)
Fixed Price: Here you can specify fixed prices. For example, if you have an entry signal at $30000, you can set the exact price for the take profit ($32000, $34000, $36000 etc..) and stop loss levels ($28000)
Pip: All values entered are in pips. For this, pip calculation must be enabled at the beginning of the settings.
%: Setting of take profit/stop loss orders at a specified percentage distance from the closing price before the long/short signal is entered
Price: You can manually set the take profit and stop loss levels on the scale of the selected instrument.
Signal conditions + Alert (Entry rules)
You can automate with these alerts. The basic message works with all (3commas) providers tested so far. If you want a custom message, you can set it up!
The TradeMaster PRO signal and backtesting algorithm uses the entry and confirmation conditions you set as the strategy entry for long and short signals. These are also displayed on your chart.
Users can change the type of confirmations in the “confirmations” section below.
Now let’s look in detail step by step at the login conditions and confirmation conditions.
Structure signal conditions #
The structure of signal conditions is based on the Smart Money structure.
For more information on the Smart Money structure, please see Smart Money Concepts
In short, we distinguish between two types of structures. 1. swing structure, 2. internal structure.
They are part of the Swing structure:
- Swing BOS
- Swing CHoCH
- Swing Liquidity grab (LG)
They are part of the internal structure:
- Internal CHoCH
- Internal BOS
- Internal Liqudity grab (LG)
HTF indicates a higher time frame, which allows you to receive signals from higher than the given time frame.
- Swing CHoCH: Enable LONG/SHORT signal for Smart Money Swing CHoCH structure changes.
- Swing BOS: Enable LONG/SHORT signal for Smart Money Swing BOS structure changes.
- Swing Liqudity Grab: Liquidity hunts in the swing structure detected by our unique algorithm allow the creation of a signal.
- Internal CHoCH: Enable LONG/SHORT signal for Smart Money Internal CHoCH structure changes.
- Internal BOS: Enable LONG/SHORT signal for Smart Money Internal BOS structure changes..
- Internal Liqudity Grab: Liquidity in the internal structure of hunts detected by our unique algorithm allows the creation of a signal.
Level Signal Conditions #
Within the “LEVELS” category, you can display signals on your chart and use them as entry conditions by breaking/breaking various major levels or by bouncing the price.
- Range High/Low Bounces: Bouncing/rejecting the price from the range top or bottom (Range function) will generate a LONG/SHORT signal.
- Range Mid Bounces: A price bounce or rejection from the middle of the range will generate a LONG/SHORT signal.
- Fibonacci bounces: A bounce from the fibonacci levels defined below will generate a long/short signal.
- Swing OB Bounces: A price bounce/rejection from a swing order block will generate a LONG/SHORT signal. (In the Mitigation section you can set which OBs are considered “completed”, so no signal can be generated for them.)
- FVG Bounces: The price bounce/rejection of an FVG will generate a LONG/SHORT signal (checking* will only take extreme FVGs into account), (in the Mitigation section you can set which FVGs are considered “completed”, so no signal will be generated for them.)
- Previous High/Low Bounces: A price bounce or rejection from the previous top/bottom will generate a LONG/SHORT signal.
- Previous High/Low Breaks: A breakout/breakdown of the previous peak/slope will generate a LONG/SHORT signal.
- Previous Open/Close Bounces: A bounce or rejection of the price from the previous open/close will generate a LONG/SHORT signal.
- Previous Open/Close Breaks: Breakout/breakdown from the previous open/close will generate a LONG/SHORT signal.
Custom indicator conditions #
In this category, you have the possibility to generate a signal according to specific conditions (also according to specific values) based on the indicators you have defined. You can set the indicators and their values below and change them! Here are three columns, which I will briefly describe and give you some examples to help you understand it better.
Under custom indicator condition, there are three main columns that the user can set:
- Select indicator type: in the first column, you can specify which indicator type you want the script to take into account. In the first column, you can specify which technical element you want to be considered during the price movement.
- Set condition: In the second column you can set the condition you want to test. Here you can decide what behaviour the script should observe in the exchange rate. You can choose between the following options: Breaks out, Breaks down, Bounces from or Rejects from the specified indicator.
- Second indicator selection: In the third column, you have the possibility to select the indicator that the script should monitor based on the indicator defined in the first column and the condition set in the second column.
- +1: At the end, you can specify whether a long or short signal should be generated when the condition is met.
Use these four steps to customize the script and tailor it to your trading strategy.
Let’s look at some examples to better understand this functionality:
MTF MA Strategy: this strategy monitors the breakouts and breakdowns of multi-timeframe moving averages (MTF MA). If the “MTF MA 1” breaks (i.e. crosses) the “MTF MA 2”, then a long position is opened (LONG). If it breaks (i.e. crosses) the “MTF MA 2”, then a short position is opened (SHORT).
MACD Strategy: In this strategy, we monitor the MACD line breakout and break down relative to the MACD signal line. When the MACD line breaks the MACD signal line (i.e. crosses it), we open a long position (LONG), and when the MACD line breaks the MACD signal line (i.e. crosses it downwards), we open a short position (SHORT).
RSI Strategy: In the RSI (Relative Strength Index) strategy, we monitor the interaction of the RSI value with the 25 and 75 levels. If the RSI breaks above the 25 level, we open a long position (LONG). If the RSI breaks the 75 level, we open a short position (SHORT).
Egyéni Indikátor Stratégia: In this case, users can use their own indicators in the strategies. Here, for example, we observe the interaction between the “Custom Indicator 1” indicator and the “Custom Indicator 2” indicator. If “Custom Indicator 1” bounces off “Custom Indicator 2”, a long position (LONG) is opened. On the other hand, if “Custom Indicator 1” is rejected by “Custom Indicator 2”, we open a short position (SHORT).
Signal Confirmations #
Users may want to filter out certain signals, and our algorithm will only generate a signal if certain or multiple conditions you specify are met. The TradeMaster Pro system includes various built-in filters, these are:
🟢Long: Enable Long Signal (If enabled, it can only generate a LONG signal, if disabled, there is NO long signal)
🔴Short: Enable Short Signal (If enabled, it can only generate a Short signal, if disabled, there is NO Short signal)
Match Candle Direction: For Long/Short signal the candle must match the direction.
Long must be a bull candle when the condition is met. For a short signal, it must be a bearish candle when the given condition is met.
Wait for trade to finish:The system does not allow multiple active trades at the same time. New signals will only appear after the currently active trade has closed.
Close on opposite signal: Additional filter, only works if the “Wait for trade to end” option is enabled. An entry signal in the opposite direction will close the currently active trade and open a new one in the new direction.
Contrarian: Manipulation. It reverses the direction of the signal, which can lead to unexpected results. Use with extreme caution! (A long signal becomes a short signal and a short signal becomes a long signal.)
- Order Flow: Filtering signals by bull/bear structure. So, based on the signal conditions set above, a signal will only be generated if the orderflow set here is present.
- You can filter signals by structure. You can also set the structure status to be indecisive/weak/strong/strong at the same time as the entry signal.
- Sentiment (F&G): It measures market sentiment and you can filter the display of signals accordingly. You can further set the sentiment to be weak/confident/strong at the same time as the entry signal.
- Momentum: You can filter signals by momentum. You can further set the momentum to be weak/strong/strong at the same time as the entry signal.
- Trend: You can filter signals by trend/structure. You can also set the structure/trend to be weak/strong/strong at the same time as the entry signal.
- Volume: You can filter signals by volume. You can also set the volume to be above average/safe/strong at the same time as the entry signal.
- Volatility: You can filter signals by volatility. You can also set the volatility to be above average/safe/strong at the same time as the entry signal.
- Volatility Squeeze: You can also filter signals by volatility squeeze. This means that to generate a signal, the volatility function of the trademaser pro indicator must show a squeeze. The price should contract into a narrow channel where there are no big swings up or down. In this phase, the price has calmed down after a period of high volatility and is gathering strength for the next move. This stems from the following theory: every period of high volatility is followed by a low, and every period of low volatility is followed by a high.
Match Last Divergence direction: This setting means that the trading signal will only be generated if it matches the direction of the last divergence (LONG = Last divergence must be bullish, SHORT = Last divergence must be bearish)
For custom indicator confirmations, please read the “Custom indicator conditions” section above. Here they are not used as signal generation, but as filtering conditions for signals set in the signal conditions.
Here you can set the divergences you want to use. The first column (RED) represents the traditional divergences (enable with the tick), while the second column (YELLOW) represents the hidden divergences (enable with the tick)
Indicator Parameters #
Indicator parameters allow us to customise our indicators to suit our own strategy and trading style. Indicators often have pre-set parameters that are designed for general use, but may vary for each market and trading situation. Customizing indicator parameters allows them to better fit the trader’s own market analysis and trading style.
For example, in a fast-moving market, traders often choose shorter time frames for indicators to better track rapid market changes. However, for a slower, trend-following strategy, longer time frames may be beneficial.
Tailoring indicator parameters can help to better match indicators to market conditions, increasing the accuracy of trading signals and reducing the number of false signals. However, it is important to note that any modifications should be in line with the trader’s trading plan and strategy.
IMPORTANT! Here you can set up the indicators you want to import, which you can use for both signal generation and signal confirmation. The numbering is important and corresponds to the numbering of the “imported indicator” in the settings above! So pay attention to this!
The style category allows you to customize the appearance of the indicator on the graph. You can adjust the position, size and colour of the indicator in this area to best suit you and your trading style.