GRAPHS, STATISTICS, AND CHARACTERISTICS:

FIVE YEAR ALGORITHM WITHOUT MONEY MANAGEMENT (1€/PIP)

DEFCON 4 (color) VS. Nasdaq Index (black) +10686€

FIVE YEAR ALGORITHM WITH MONEY MANAGEMENT BACKTEST (0.5€/PIP)

DEFCON 4 (color) VS. Nasdaq Index (black) +338243€

TECHNICAL OVERVIEW

The DEFCON 4 algorithm is a fully automated, long-only trading system designed for the Nasdaq 100 index (NDX), built on the ProRealTime platform. This system is based on a structurally conservative framework optimized for frequent market engagement while maintaining strict capital preservation mechanisms.

Developed as a modular, adaptive system, DEFCON 4 supports dual configurations: with and without dynamic money management. Its core logic emphasizes high-probability entries, fast break-even protection, and controlled profit extraction through trailing and fixed exits.

Finalized in early 2024, DEFCON 4 inherits structural inspiration from earlier DEFCON frameworks but introduces significant optimization in execution frequency, volatility control, and profit distribution. It is well-suited for traders seeking resilient, high-confidence entries with lower average drawdowns.

TECHNICAL SPECIFICATIONS

• Algorithm Name: DEFCON 4

• Target Market: Nasdaq 100 (US Tech 100 Cash)

• Position Type: Long-only (no short trades)

• Timeframe: 15-minute candles

• Platform: ProRealTime

• Programming Language: ProBuilder

• Trading Hours: UTC +1

• Trade Frequency: Moderate-High (6–14 trades per week)

STRATEGY PARAMETERS

• Stop Loss: ~1.00%

• Take Profit: ~4.00%

• Break-even Activation: At +0.10%

• Trailing Stop: Enabled, with layered logic

• Entry Conditions: Momentum, breakout filters, volatility gating

• Money Management:

  • Without MM: Fixed size (1 €/pip for €2,000 capital)

  • With MM: Progressive sizing from 0.5 € based on equity growth (starting from €2,000)

PERFORMANCE COMPARISON

Starting capital: €2,000

MONTECARLO SIMULATION RESULTS

Methodology: 100,000 random permutations of historical trade data

Probability of Profit

Average Profit

Additional Metrics

The DEFCON 4 algorithm represents an evolution of the DEFCON trading logic, refined for greater frequency, improved trade-to-trade reliability, and a stronger defensive posture in volatile environments. Its low stop-to-target ratio, high win rate, and modular structure make it an excellent fit for both intermediate and advanced systematic traders.

The fixed-size mode (without money management) caters to traders with capital restrictions, regulatory constraints (such as prop firms), or preference for smooth equity curves. This configuration still achieves meaningful compounding through consistent win rates and a strong reward-to-risk profile.

In money-managed mode, DEFCON 4 scales rapidly and exploits equity growth via dynamic pip sizing. The result is aggressive capital expansion—with over €1 million projected after five years from just €2,000 of starting capital—while preserving statistical integrity under Monte Carlo stress testing.

What further distinguishes DEFCON 4 is its high trade frequency and hit rate, which buffer it against volatility clusters and equity stagnation phases. It has also been tested under randomized trade sequences and shows minimal variance across simulations—indicating high robustness and generalizability.

Ultimately, DEFCON 4 is an optimal solution for traders who seek:

• A balance between consistency and growth

• Scalable risk management options

• High win rate with controlled exposure

• Reliable, frequent engagement with markets

• Resilience under stress and randomness

Its technical integrity, consistent outperformance of the Nasdaq index, and adaptability for both passive and compound growth strategies mark it as a standout system in algorithmic equity trading.

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