Does Three-down-days bounce actually work on SMCI? We tested it
We ran Three-down-days bounce on SMCI through walk-forward testing and a 100-run random-entry gauntlet. 3 of 4 unseen periods positive. Beat 89 of 100 random-entry runs.
You gave up raw return for a higher win rate and a shallower drawdown. This setup is about timing and staying out of trouble, not beating the index.
Equity curve over Aug 2016 to Jul 2026. Hover any point for its value. Turn on buy and hold to compare.
The same rules, tested on 28 tickers. Edge held on 6. We ship it on those.
Show every ticker we tested
This strategy made money overall, turning a 185.93% total return on SMCI, and it did so with a high win rate of 71.05%, meaning most trades were winners. However, the ride was not smooth; the max drawdown of -20.62% was a painful stretch from late May 2024 to August 2025, which is where the strategy hurt the most. The entry timing is a key strength here, as the real entries beat 89% of random entry runs, so the setup itself is doing the heavy lifting rather than the exits. The edge was also consistent, showing up in 3 out of 4 walk-forward test periods, so the results are not just from one lucky streak. Overall, this is a solid setup that makes money steadily, but you have to be prepared for a significant 20% drawdown that can last over a year.
Every verdict on this page comes from the same process. How we test.
Sign up free. EdgeStacker runs a fresh backtest for you, then alerts you on the Today screen when the setup fires.