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Mean reversion · AVGO · 1D

Does Stochastic %K/%D cross actually work on AVGO? We tested it

We ran Stochastic %K/%D cross on AVGO through walk-forward testing and a 100-run random-entry gauntlet. 3 of 4 unseen periods positive. Beat 95 of 100 random-entry runs.

WALK-FORWARD VERIFIED EDGESTACKER ENGINE
Return +312.4%
Win rate 80.6%
Max drawdown −48.3%
Trades 36
Sharpe 0.85
Equity curve

Equity curve over Aug 2016 to Jul 2026. Hover any point for its value. Turn on buy and hold to compare.

PeriodWindowReturnSharpeTrades
1 Aug 2018 to Jul 2020 −0.9% 0.19 7
2 Jul 2020 to Jul 2022 +9.6% 0.40 8
3 Jul 2022 to Jul 2024 +74.5% 2.03 9
4 Jul 2024 to Jul 2026 +83.6% 1.30 10
3 of 4 periods positive. Mean Sharpe 0.98. Worst period −0.9%.
Market matrix
Edge held on 7 of 28

The same rules, tested on 28 tickers. Edge held on 7. We ship it on those.

AVGO SHIPPED
95/100 EDGE
SPY
95/100 EDGE
XOM
92/100 EDGE
QQQ
91/100 EDGE
META
91/100 EDGE
NVDA
82/100 EDGE
JPM
76/100 EDGE
Show every ticker we tested
NFLX
83/100 NONE
COIN
75/100 NONE
DIA
68/100 NONE
UBER
68/100 NONE
MSTR
61/100 NONE
MU
60/100 NONE
IWM
57/100 NONE
RIOT
55/100 NONE
AMZN
54/100 NONE
BA
53/100 NONE
MSFT
49/100 NONE
GLD
48/100 NONE
AAPL
26/100 NONE
SOFI
18/100 NONE
MARA
17/100 NONE
AMD
16/100 NONE
GOOGL
15/100 NONE
SMCI
10/100 NONE
TSLA
7/100 NONE
PLTR
too new TOO NEW
HOOD
too new TOO NEW
The rules
Entrywhen STOCH %K(14/3/3) of close crosses above STOCH %D(14/3/3) of close AND STOCH %K(14/3/3) of close is below 30 AND close is above SMA of close over 200 bars
Exitwhen a signal fires (STOCH %K(14/3/3) of close is above 80)
Sizing**Position size:** no fixed stop distance to size against. This strategy exits on signal only. Size by conviction, or add a hard stop for a size-by-risk number.
Diagnosis

This strategy made a strong 312% total return on AVGO, but the ride was very lumpy. The worst moment was a brutal 48% drawdown from mid-February to mid-March 2020, which shows that the setup can get crushed during sharp market drops. The high win rate of 80% and 36 trades suggest the result is not driven by just a few lucky trades, but the max drawdown is severe enough to test your patience. The entry timing is a major strength here, as real entries beat 95% of random entry runs, meaning the specific moment you get in is carrying the result rather than the exits. The edge was consistent across three out of four walk-forward periods, so the performance did not come from just one lucky stretch.

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Backtested results, not live trading returns. Fees and slippage included. Not investment advice.