Everyone shows you the equity curve going up. Here’s mine — including the year it went down.
In Part 1, I told you how a lookahead bug almost made me fund a fantasy. This is what survived the bug hunt: Setup B, a breakout system, tested on 11.75 years of data. Every number below is real. Including the ugly ones.
The system in 30 seconds
Setup B trades breakouts from 12-bar consolidations on XAU/USD M15: ATR-based stop (1.5×), minimum 3:1 reward-to-risk, take half at the first target and move the stop to breakeven, exit after 24 hours max. One position at a time, max three trades a day. No AI, no discretion — pure rules.
The numbers
- 819 trades (January 2015 – August 2026, Dukascopy M5 data, ~833,000 bars)
- +196.05R total, profit factor 1.37
- Win rate 23.8% — yes, it loses three out of four trades
- +0.239R per trade on average
- 414 buys / 405 sells — no directional bias
- 11 out of 12 years positive
Read that win rate again: 23.8%. Most “gurus” would be embarrassed to publish it. I’m not, because the math works: small losses, occasional large wins, breakeven stop doing the heavy lifting.
The year I lost money
2021: −2.62R. There it is, in public.
A system that never has a losing year is either curve-fit or lying. 2021 was a choppy, directionless year for gold, and Setup B bled slowly. If you’re evaluating any system — mine or anyone’s — ask to see the worst year. If they won’t show it, walk away.
The surprise
Here’s what I didn’t expect: the strongest period wasn’t the gold bull market. It was 2015–2019 — when gold mostly went sideways or down. Profit factor 1.53, +123.3R.
That kills the obvious objection (“your system just rides the bull market”). The edge doesn’t come from the trend. It comes from the structure: tight consolidations, asymmetric payoffs, ruthless exits.
The honest caveats
No honest report ends without these:
- No spread, commission, or slippage in these numbers. Real life will shave the edge — my estimate is ~0.1–0.15R per trade after costs.
- Dukascopy feed ≠ my broker’s feed. Volatility on Dukascopy runs higher (ATR ~$9 vs ~$5.5). The final verdict comes from live forward-testing, which started this week.
- The backtest stopped at August 2026; data timestamps are GMT.
Anyone who shows you a backtest without caveats is selling you something.
The point
819 trades. PF 1.37. One losing year, shown proudly. This is what a real, testable edge looks like: modest, ugly, and honest.
This is Part 2 of a 4-part series. In Part 3, I trained an AI to predict gold prices on these 819 signals. It flipped coins — AUC 0.52. Here’s the autopsy.
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