Streak Intuition Simulator

A trader running a system with a genuine 55% win rate still expects to see multi-loss runs - that is simply what a sequence of independent coin flips looks like. In practice, a losing streak of six or seven trades in a row is very often read as proof something changed, even though nothing did; it is well within ordinary binomial variance at that win rate and sample size. This script runs the actual simulation instead of relying on intuition. It simulates a large number of independent trade sequences at a chosen win rate, using the built-in pseudo-random generator, and records the LONGEST losing streak within each sequence. It then reports the distribution of that longest streak across all simulated sequences - the median, the 90th and 99th percentile, and the single worst case seen - plus the exact percentage of sequences in which a streak at least as long as the user's own "this looks broken" guess actually occurred. A rough analytic cross-check (the expected count of streaks of that length or longer, from the standard run-length approximation) is printed alongside the simulated numbers as a sanity check, not a replacement for the simulation. The result reframes "I just lost N in a row" from a verdict on the system into a question with an actual base rate: how often does that happen anyway, purely from variance, at the win rate the trader believes they have. Notes and limitations - The simulation assumes each trade is an independent Bernoulli trial at a fixed win probability - it deliberately does not model streaks clustering from a real strategy's serial correlation, regime changes, or a genuinely degrading edge. A real trading system may have correlated outcomes that this simple model does not capture; treat the reported numbers as a variance FLOOR for an honestly independent system, not an upper bound on how bad a real streak could get. - Uses only wins and losses - it does not model trade size, R-multiples or asymmetric payoff, so it answers "how long is a losing streak likely to be", not "how much money is at risk in one". - The printed analytic cross-check is an order-of-magnitude approximation for sanity-checking the simulation, not an exact formula for the longest-run distribution. - Uses the built-in MathRand()/32768 uniform generator; this is adequate for the number of trials here but is not a cryptographic or high-precision statistical random source.

Script · MT5 · v1.0 · Free

Tags: Alerts · MT5 Script · MQL5 Source Code

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