Forex Swing Trading

Systematic swing trading strategy for forex pairs using daily timeframes.

Status: Strategy Validated ✅

Location: ~/clawd/forex-signals/

Strategy Summary

What Works

• Timeframe: Daily candles only (1-hour = ~30% win rate, doesn't work)
• Best Strategy: Support-Stop
  • 56.2% win rate
  • 2.0R maximum drawdown (vs 3.2R baseline)
  • Outperforms all other tested approaches

Position Sizing (Kelly Criterion)

• Full Kelly: 12.4% per trade (too aggressive)
• Quarter Kelly (recommended): 3% per trade
• Balances growth with drawdown protection

Backtesting Results

Strategy	Win Rate	Max DD	Notes
Baseline	52.8%	3.2R	No filters
Support-Stop	56.2%	2.0R	Winner
ATR Filter	54.1%	2.8R	Modest improvement
Combined	55.8%	2.1R	Diminishing returns

Key Findings

1. Daily timeframe is essential — shorter timeframes don't work
2. Support-based stops dramatically reduce drawdown
3. ATR filters help but aren't game-changing
4. Simpler is better — Support-Stop alone is the play

Next Steps

• Paper trade with real signals for 30 days
• Set up automated signal alerts to Slack #forex-signals
• Document entry/exit rules precisely
• Consider 3.0 ATR filter for more signal volume

Files

• backtest_results.json — Full backtesting data
• kelly_sizing.py — Position sizing calculator
• strategies/ — Strategy implementations

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Created: 2026-01-28 | Last updated: 2026-01-31