Hello,
I wanna ask profitable traders, can a strategy be profitable after losing streaks like 10 trades?
How do you manage to keep going and trusting your strategy?
Thank you.
Last week in one day I had 10 losing trades in a row and the next day I had 13 winners in a row. I just trust my edge.
Ellis said:
Last week in one day I had 10 losing trades in a row and the next day I had 13 winners in a row. I just trust my edge.
Damn.
Thanks 
When in doubt, backtest. That’s the only way. And then you keep to it, no matter what. At one point, losing streaks should just be an inconvenience, not something that will make you question everything. If every time you question yourself when there’s a losing streak, you’ll be in a never-ending circle of chasing perfection and then give up because there’s no such thing.
However, if you had a strategy that has like a 50% W/R normally, losing 10 times might be worth a review of what happened for sure.
But some traders will have systems that favor huge positive RR and 10 losing trades is just “meh.”
You need to know what’s your win rate on average.
A simple Monte Carlo simulation with a 2.5 RR and a 38.5% WR shows a maximum of 12 losses in a row over a few years and 30 trades/month. Even with a very respectable 48.5% WR, it’s 9 losses in a row.
Wes said:
@Clovis
Thank you.
I think I just have to trust the process…
Yes, but to give you confidence, you need to backtest. Some will even advise to trade super small or on demo for further confirmation.
Good traders trust their edge and know the market gives and takes; you just need to take more for yourself than give over the long run.
@Clovis
There is no maximum number of losses. It’s all probability. A 50% win rate could have 100 losses in a row. It’s very, very unlikely, but in an infinite number of throws, it’s inevitable.
To put an exact figure, there is a 1.8% chance of 12 losses in a row at a 38.5% win rate.
@Skylar
Yes, of course, but you can simulate a strategy mathematically over a huge amount of trades; it gives an idea.
You just keep going, dude. Even during a losing streak, it does not mean that the strategy is not working, but instead the market conditions are not good for your strategy. So you just sit on the sidelines and wait for the conditions to get better.
@Wyatt
Sometimes even when the market is trending, my strategy seems to not be working.
Yes, I don’t trade unless market conditions are good for me.
Wes said:
@Wyatt
Sometimes even when the market is trending, my strategy seems to not be working.
Yes, I don’t trade unless market conditions are good for me.
10 losses in a row is a lot. As much as it is possible even with a profitable strategy, it’s best to still review these trades and your approaches so that you can know what to tweak.
Because that’s the ultimate trick: to continue to adjust things until your win rate increases or risk to reward gets better, as well as your confidence.
Profitability is not measured by winning streaks. You should look at whether it gave you positive net RR on your past trades from that strategy.
10 loss streak is too much unless you are scalping.
Imagine a child flipping a coin and pressing the button with a 50% chance to lose; would he take 10 losses in a row that easily??
We can’t know if it’s normal or not because we don’t know your RR, your risk management, but I have something for you to backtest:
- If your RR > 1, backtest by taking partials after your trade goes to 1:1 and put it at break even.
- If your RR < 1 (not scalping): backtest hedging techniques.
But the thing with consecutive losses (if you have a strong strategy well backtested) is that you have to find common points between your losses that don’t come from your winners, and avoid trading each time this condition appears (guess what 
? After finding this, you have to backtest it on your past losers and also winners!)
Hope those lines could help you. Do not forget backtesting is a powerful tool to refine your strategy.