Donchian Channel Scalping Strategy Explained (+ Backtest)
Loses money
No edge after realistic trading costs
- trades tested
- 6,501
- per trade after costs
- -1.83bp
- winners
- 39%
- years of data
- 14.7
An EA on EURUSD H1 keeps a buy-stop order at the upper line and a sell-stop order at the lower line of a 20-bar Donchian channel, moving them as the channel changes. Each trade has a 300-point (30-pip) stop and target, plus a tight trailing stop (20 points) that starts once the trade is 40 points in profit.
The exact rules we tested
- 01Instrument: EURUSD | Signal timeframe: 1h | Direction: both
- 02Filter: dc.upper > dc.lower
- 03Entry: stop order at the break of dc.upper (longs) / dc.lower (shorts) (expires after 1 bars)
- 04Stop: 0.27%
- 05Target: 0.27%
- 06Trailing stop: 2 x ATR(14)