High Precision 5-Minute Scalping with Machine Learning is a trend-following strategy that leverages multivariate statistical techniques to filter and optimize trading signals. This advanced machine learning approach synthesizes multiple variables, enhancing regression techniques for accurate predictions.
The ANN algorithm processes data in chronological order, performing calculations every 4 bars to maintain efficiency and ensure a minimum spacing between neighbors. This strategy is designed specifically for the 5-minute timeframe and is best suited for highly volatile instruments. It requires configuration for each specific instrument, making it crucial to select 4-5 volatile instruments with a win rate above 63%. An additional trend filter, the slow MACD, further refines the strategy.
Strategy Setup
Time Frame: 5 minutes
Instruments: GBPJPY, BTCUSD, Oil, Tesla, VIX, EURAUD, AUDUSD, AUDJPY, EURJPY, NZDUSD, GBPUSD
Indicators:
Machine Learning Lorentzian Classification (see pictures for settings)
MACD with two options: (32, 64, 12) and very slow (64, 128, 12) – the latter is optional due to the highly filtered nature of the Machine Learning indicator
Trading Rules
Buy Signal
Machine Learning buy arrow
MACD > 0.
Sell Signal
Machine Learning sell arrow
MACD < 0.
Exit Strategy
Initial stop loss below/above the previous swing low/high
Profit target with a minimum stop loss ratio of 1.1:15 or using a trailing stop
Conclusion
The "High Precision 5-Minute Scalping with Machine Learning" strategy employs machine learning and multivariate statistics to follow trends, optimized for highly volatile instruments on a 5-minute timeframe. By performing calculations every 4 bars, it ensures efficiency and adequate spacing between signals. Using a Lorentzian distance metric and a slow MACD (32, 64, 12) as a trend filter, the strategy is applicable to various currency pairs and volatile assets like GBPJPY, BTCUSD, and Tesla. It follows clear trading rules: buying when a machine learning buy arrow appears and MACD is above 0, and selling when a sell arrow appears and MACD is below 0. Exits are managed with a stop loss placed above/below the previous swing high/low and a profit target with a minimum stop loss ratio of 1.1:15 or a trailing stop.
Download
https://docs.google.com/document/d/1gYp1vu6FBdYwOOZWJxrA-OQbQtXpqOYLPHqxljRjo_4/edit?usp=sharing
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