Absorption
This EA trades based on the 'Absorption' candlestick pattern, where a candle's body engulfs the previous candle's body, signaling a potential reversal. It enters trades in the direction of the absorbing candle after the pattern is confirmed. The strategy applies fixed lot sizing without martingale or grid components.
Open the interactive view (equity curve, symbol switch)Key facts
Backtest results (H1, about 1 year)
| Symbol | P&L | Annual | Max DD | Trades | Win rate | Sharpe | Recovery | Losing streak | Per trade | Status |
|---|---|---|---|---|---|---|---|---|---|---|
| EURUSD | +4.56% | +3.95% | 4.02% | 76 | 56.00% | 0.90 | 1.13 | 5 | +$6.54 | Reliable |
| GBPUSD | -3.20% | -2.79% | 6.34% | 74 | 40.50% | -0.49 | -0.51 | 7 | −$4.33 | Reliable |
| USDJPY | +1.46% | +1.27% | 7.07% | 71 | 49.30% | 0.26 | 0.21 | 8 | +$2.05 | Reliable |
| XAUUSD | -15.97% | -13.39% | 69.23% | 68 | 54.40% | 0.44 | -0.23 | 5 | −$23.48 | Reliable |
Profitable on 2 of 4 markets with reliable results.
Converted from MQL5 to Python and run with the same rules for every EA. Positions use MT5 lot sizes (100,000 units per FX lot, 100 oz per gold lot) with 1:100 leverage, one order at a time, and a stop-out below 10% of the starting balance. Sharpe is computed from the equity curve. Results marked as unreliable are shown for completeness only.
Month by month
| Market | Months with a gain | Best month | Worst month |
|---|---|---|---|
| EURUSD | 62% | +2.47% 2025-11 | -1.73% 2026-02 |
| GBPUSD | 38% | +2.06% 2026-01 | -2.96% 2026-10 |
| USDJPY | 54% | +2.39% 2026-09 | -3.38% 2026-08 |
| XAUUSD | 54% | +23.05% 2025-11 | -21.04% 2026-09 |
From the backtest equity curve, sampled about every two days; only reliable results.
Blow-up risk: No blow-up pattern found
None of the usual blow-up patterns were found in the code, and the account was not stopped out in our backtests. That is not a guarantee: any EA can lose money.
High: stopped out in our backtest, or martingale/grid sizing without a stop loss. Elevated: martingale or grid sizing with a stop loss, or several positions at once without a stop loss. What the label means and what we found →
Strategy analysis
The strategy centers on identifying the classic Absorption (Engulfing) candlestick pattern, where the current candle's body completely covers the previous candle's body, signaling a potential market reversal. Entry conditions are: a bullish candle engulfing a bearish candle triggers a buy, while a bearish candle engulfing a bullish candle triggers a sell, with trades executed after the pattern is confirmed at candle close. Exit conditions rely on user-configured stop loss and take profit parameters; if these are not set, there may be no explicit exit mechanism. Position sizing uses a fixed lot size without dynamic adjustment or position scaling. Money management lacks risk-based or account-equity-based dynamic calculation, creating uncontrolled per-trade risk exposure. The overall logic is straightforward but lacks filtering conditions and multi-confirmation, making it prone to false signals and frequent losses in ranging markets.
Strengths
- Strategy logic is simple and clear, easy to understand and verify
- Based on a classic candlestick pattern with broad technical analysis support
- No martingale or grid mechanism, avoiding account blow-up from consecutive losses
- Clean code structure, convenient for further development and optimization
Weaknesses
- Single candlestick pattern lacks filtering, generating many false signals in ranging markets
- Default stop loss and take profit are 0, creating extreme risk when not configured
- Fixed lot size without dynamic adjustment based on account equity is crude money management
- No new bar check mechanism, potentially opening duplicate positions on the same bar
- Lacks auxiliary conditions such as trend filtering or volume confirmation
Possible improvements
- Add trend direction filtering (e.g., moving average direction) to trade absorption patterns only in the trend direction
- Implement ATR-based dynamic stop loss and take profit instead of fixed values or zero defaults
- Implement risk-percentage position sizing that dynamically adjusts lot size based on account equity
- Add new bar check and position check to prevent duplicate entries
Risk assessment
Overall risk: High risk
- Default stop loss and take profit are 0, providing no exit protection if not configured
- No new bar check may cause repeated position opening on the same bar, leading to uncontrolled exposure
- No position check may stack multiple same-direction orders, amplifying risk
- Single pattern without filtering can trigger consecutive losing trades in ranging markets
Evaluation scores
Parameters
| Parameter | Default | Description |
|---|---|---|
LotSize | 0.1 | Fixed lot size per trade |
StopLoss | 0 | Stop loss in points, 0 means no stop loss |
TakeProfit | 0 | Take profit in points, 0 means no take profit |
MagicNumber | 12345 | EA magic number for identifying this EA's orders |
Timeframe | H1 | Trading timeframe |
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Backtests are historical simulations and do not guarantee future results. Not financial advice.