0:02 the ishim moku cloud is a popular
0:04 trading indicator used to identify
0:06 market trends support and resistance
0:09 levels and potential reversals however
0:11 for a beginner trailer this indicator
0:13 may be very confusing and as such
0:15 difficult to use and if you back test it
0:18 in a large sample size and different
0:20 assets you will notice that probably it
0:22 is not as efficient as you might think
0:24 but in this video I will share with you
0:26 another cloud-based indicator that is
0:29 more efficient profitable and consistent
0:32 than the isimu Cloud as you can see its
0:34 signals are more simple reliable and
0:36 allow you to catch larger price
0:38 movements so I will introduce you to
0:40 this new indicator show how to use it
0:43 and also test it on more than 3,000
0:46 trades among the Forex crypto gold and
0:48 stock market to discover its real
0:50 efficiency and stay tuned because this
0:53 will be the new top one indicator tested
1:06 so this indicator is called Purple Cloud
1:08 on trading view you can find two
1:10 versions of it that you can use but the
1:13 one that I will use is this one created
1:15 by my team which you can also use for
1:17 free you just need to enter on my free
1:19 Discord Community the link is on the
1:21 description head over to the free
1:22 materials Channel and there you will
1:24 find the code of my purple Cloud
1:27 indicator open up this note copy the
1:29 code and then on the trading view charts
1:32 click on the pine editor then on open
1:34 new indicator and then just paste the
1:36 code and save it after that just click
1:39 on the add to shart option and you will
1:40 have this indicator working and with the
1:45 right settings which are 10 3 40 and 0.9
1:47 if you like this free indicator don't
1:48 forget to show me your support by
1:50 subscribing and clicking on the like
1:53 button as you can see this indicator
1:55 which is a trend indicator calculated
1:58 based on exponential and simple moving
2:00 averages with different weights is very
2:02 simple to use because it prints the
2:05 entry signals on your shards when this
2:07 rocket appears it means it is time to
2:09 enter in the long position and when this
2:11 star appears it means you can take a
2:14 short position you may also notice that
2:16 this indicator changes the color of the
2:18 candles depending on the direction of
2:20 the signals but you can turn off this
2:23 function here if you want also as you
2:25 can see this indicator sometimes prints
2:28 these buy and sell signals but they are
2:31 weaker compared to this ones so we not
2:34 use them to enter in positions and so I
2:36 will uncheck them here and by looking at
2:39 some examples this indicator appears to
2:41 be very precise but to confirm the
2:43 results of this indicator we will need
2:46 to back test it and as I usually tell
2:48 you in all my videos about testing
2:50 indicators to conduct a proper back test
2:52 you need to have first the technical
2:55 system second the risk management rules
2:57 and third the testing conditions
2:59 regarding this last step if you have
3:01 been watch watching this series about
3:03 testing different indicators to discover
3:05 which ones are the best you already know
3:07 that my testing conditions are always
3:09 the same so I can compare the different
3:12 indicators I test fairly and efficiently
3:15 so I will back test the purple cloud in
3:17 three different time frames the 30
3:20 minutes the 1 hour and the daily one on
3:22 every time frame I will use the data
3:26 sample from 2022 and 2023 with all the
3:27 available trading sessions with an
3:30 efficient and diverse portfolio of
3:32 assets from different markets which are
3:35 Bitcoin ethereum xrp three currency
3:39 pairs gold oil the S&P 500 Index and the
3:42 Apple stock regarding the Second Step
3:44 the risk management it will also be the
3:47 same one I used in all my other episodes
3:50 using a 2% risk per dve a stop loss
3:52 calculated based on two times the
3:55 average to range indicator number and by
3:57 using a take profit on the one to one
4:00 rward ratio Zone if you'd like to know
4:02 more about this risk management system
4:04 check out the first episode of this
4:06 series finally regarding the technical
4:08 system in addition to the purple Cloud
4:12 indicator I will also use a 200 period
4:14 exponential moving average as a baseline
4:17 just to filter losing signals from the
4:19 indicator in a way that I will only
4:21 consider entry signals that are in the
4:24 same direction as the trend given by
4:26 this Baseline here you have an example
4:28 of a long position where the price is
4:30 above the 200 x exponential moving
4:32 average and here we have a short trade
4:34 example where the price is below the
4:37 Baseline and so these are our back test
4:40 conditions now as all of you should know
4:42 the most popular way of back testing is
4:44 pretty simple to do we just need to go
4:46 back in time and check every signal
4:48 manually but if you are a follower of my
4:51 work you already know that I like to use
4:53 a special tool to back test indicators
4:56 in a quick simple and efficient way and
4:58 for that I will add the indicators
5:00 testing bot to my sharts for those who
5:02 don't know this is an Innovative and
5:05 unique tool that allows quick testing of
5:08 indicators at the moment you have 48
5:10 indicators available to test among
5:12 trigger indicators baselines and even
5:15 volume indicators but from week to week
5:18 new indicators are added to the database
5:20 of this tool after you insert it on your
5:22 charts you just need to select the
5:24 indicator or indicators you would like
5:26 to test and in one second you will have
5:28 all the results on your chart in
5:31 addition to me dozens of Traders also
5:33 use this exceptional tool and the
5:35 feedback has been amazing some of them
5:37 have even managed to gain access to
5:40 funded prop firm accounts by using it so
5:42 thank you all for your amazing support
5:44 and for those who would like to use this
5:46 trading bot as well I will briefly talk
5:49 about it at the end of the video after
5:51 selecting the daa sample the risk
5:53 management the purple cloud with the
5:55 settings I told you about and the 200
5:58 period exponential moving average with a
6:00 confirmation function we are ready to
6:02 start this big analysis as you can see
6:04 the trading Bard not only displays every
6:07 valid trade on the charts but it also
6:09 gives me the monthly results on this
6:11 table and the overall statistics about
6:13 each asset I want to back test Down
6:16 Below on the strategy test Tab and
6:18 because I have the premium trading view
6:20 plan I can download all the trades the
6:22 bot takes and that's what I'm going to
6:24 do to create the trading journals I will
6:26 speed up the back test but you can slow
6:28 it down in the YouTube settings I see
6:30 you in a minute [Music]
6:56 after inserting all the trades on my
6:58 trading journal here I got the results
7:01 of the purple Cloud on the 30 minute
7:03 time frame here on the 1H hour one and
7:06 next to it on the daily time frame and
7:08 overall the results are really
7:10 impressive but let's analyze its time
7:13 frame one by one in the 30 minute time
7:15 frame after more than
7:18 1,800 trades it achieved a win rate of
7:22 52% and a net profit of
7:24 126% here you can check other metrics
7:26 like the profit factor and the average
7:28 draw down and also the results of every
7:31 single asset by looking at the equity
7:33 chart we can verify that in this time
7:36 frame the simple strategy has some
7:38 choppy moments and got a Max draw down
7:40 value above what we would expect but you
7:42 can notice that despite this it has a
7:44 growth Trend much better than most of
7:47 the other indicators we have tested so
7:50 far then in the 1our time frame things
7:52 look even better after more than
7:55 1,100 trades the purple Cloud achieved a
7:59 win rate of about 54% and the total net
8:01 profit close to
8:04 150% again here you can find other
8:06 metrics including the draw Downs which
8:08 are much lower than the previous ones
8:10 and also the results from every asset
8:13 which are quite consistent but the best
8:15 thing to look at is the equity Shard
8:17 which is very good for a simple strategy
8:20 like this one these little periods of
8:22 draw down can be easily fixed with a
8:25 filter or a volume indicator and finally
8:28 on the daily time frame after 51 trades
8:30 the indicator achieved the rate of
8:34 almost 60% and a net profit of 19%
8:35 therefore the purple Cloud indicator
8:38 proves to be efficient and has a lot of
8:40 potential in our ranking sheet it will
8:42 beat the do stochastic and will be our
8:45 new top one indicator so I believe that
8:48 this video deserves a big thumbs up if
8:50 you'd like to access this ranking sheet
8:52 Excel you can do it for free the link is
8:55 in the description as well on this stab
8:57 you can check all my tested trading
8:59 strategies and on this one the ranking
9:01 from the indicators tested on this
9:03 series where you can also find out how
9:05 you can access this indicator testing
9:08 bot I showed you during the video just
9:10 click here and despite this being our
9:12 new top one indicator I will continue to
9:15 test other indicators to try to discover
9:17 others even better so if you think you
9:19 have an indicator that can beat the
9:21 purple Cloud you can share it with me in
9:23 the comments or on my free Discord
9:25 community and probably you'll see it in
9:28 a future episode of this series so do
9:30 not forget to subscribe to don't miss
9:32 anything if you enjoyed seeing my
9:34 working methods and would like to work
9:36 oneon-one with me to enhance your
9:38 trading system and become a better
9:40 Trader you can see on my available
