NVDA strategy validation
Validated on 5-minute candles
Validated Oct 28, 2026 — may not reflect a later revision
- Max drawdown
- −16.1%
- largest fall from a peak, net of costs
- Average per trade
- −13.2 bp
- net of costs
- Profit factor
- 0.64 → 0.27
- in-sample → out-of-sample
- Win rate
- 34% → 18%
- in-sample → out-of-sample
- Trades
- 111
- 83 in-sample · 28 out-of-sample
Opening range break with pullback to gap This strategy trades long and short on 5‑minute charts, looking for breakout patterns and pullbacks to a gap (fair value gap) during the U.S. regular session. It enters when it detects an engulfing candle that confirms the pullback to a gap formed after crossing the first candle’s levels (09:30‑09:35 ET), targeting a risk‑reward ratio of 1:2 and a 0.3% stop. During the training period, the strategy generated trades regularly but accumulated consistent losses. In the out‑of‑sample period, performance deteriorated significantly: the win rate fell and losses deepened. The behavior between the two windows was very inconsistent, suggesting that the identified pattern does not hold reliably out of sample. The verdict is rejected because the strategy loses money in both periods, with a very weak profit factor in each case. Verdict: rejected, not profitable in training or out‑of‑sample. Outputs: take profit 0.6%, stop‑loss 0.3%, short side: take profit 0.6% and stop‑loss 0.3%; automatic close at session end if still open; at most one trade per day. Net results include a 0.10% cost per trade. Past results do not guarantee future results.
Results by period
| Metric | In-sampleJan 2024 – Jun 2025 | Out-of-sampleJul 2025 – Dec 2025 |
|---|---|---|
| Trades | 83 | 28 |
| Win rate | 34% | 18% |
| Profit factor | 0.64 | 0.27 |
| Avg. win | 0.50% | 0.50% |
| Avg. loss | -0.40% | -0.40% |
| Best trade | 0.50% | 0.50% |
| Worst trade | -0.40% | -0.40% |
| Longs | 45 (36%) | 16 (19%) |
| Shorts | 38 (32%) | 12 (17%) |
| Total return | -7.90% | -6.70% |
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Strategy tested
Strategy ORB (Opening Range Breakout) or first candle rule: Watch the 5‑minute chart at 9:30 AM New York time and wait for the first candle to form (between 9:30 and 9:35). Identify if price approaches one of the levels (high or low) of this candle and leaves a gap (fair value gap) between the last two candles, indicating a strong move that shows who controls (buyers or sellers). Once this fair value gap forms, wait for price to return to this level and for an engulfing candle to form as confirmation. When the engulfing candle completes, enter in the direction of the initial strong move. The goal is to seek a risk‑reward of 1 to 2 (potential profit is double the risk). (Note: the automatic transcription said “fail value gap”; it was interpreted as “fair value gap.”)
What we assumed
- APPROXIMATE: the video does not state where the stop goes; a 0.3% stop adjusted to the timeframe was used. Review this rule before confirming: it completely changes the strategy’s risk.
- The engine already limits to one trade per day (the first signal), so that rule from the video is automatically satisfied.
- Return to the gap is accepted within any of the 12 candles following its formation (default window). The valid gap is the one that results from breaking the level: the preceding candle closes on that side and the central one on the other.
- Risk‑reward target 1:2 calculated from entry and stop.
- APPROXIMATE: the video says price “approaches” the level and leaves a gap; the system has no “approach,” so it requires the gap to form by crossing that level.
- Operating window 09:40‑15:30 ET, Monday through Friday: the system calculates this so that the levels and price zones do not use candles from the previous session (only reference sizes, like an average range, may read it).
- Both directions are modeled: the opposite (short) uses the same rules with mirrored levels. The engine limits to one trade per day, the first signal of either side.
More analyzed strategies
See allPast performance is not indicative of future results. Any past result shown here reflects historical data and does not guarantee similar outcomes going forward.
This content is provided for informational and educational purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any security. Consult a qualified financial advisor before making investment decisions.
Backtested and simulated results are hypothetical and do not represent actual trading. Simulated performance has inherent limitations and may differ significantly from live results due to market conditions, slippage, and other factors.