Market Mechanics Ep 27: How to Improve Your Strategy With Data

Brad Goh explains how traders should improve their strategy using data: review at least 30-100 trades or a quarter, test each change as a hypothesis, and convert recurring behavioral patterns into if-

Key Takeaways

Make data-driven decisions over several months or 100+ trades, never on emotion or short streaks.
Treat strategy changes as scientific hypotheses that require full retesting.
Run a structured quarterly review and convert recurring behavioral patterns into concrete if-then rules.
Limit adjustments to a few variables per quarter so results remain attributable.

What the video covers

Traders often switch strategies too frequently, resetting their competence and mistaking normal variance for a failing system.
Rules should only be changed based on data: at least 100 trades or about 3 months of results, with a minimum of 30-50 trades to see anything meaningful.
Adjusting the plan based on gut feeling or short losing streaks is discouraged.
Any new variable (e.g., a fair value gap entry or trailing stop) should be treated as a hypothesis and the entire trade plan retested to prove its effect.
Quarterly reviews are recommended: review every trade from the past 90 days in depth, ideally blocking out a full day.
A quarterly review template is used to extract wins, losses, break-evens, and the variables influencing results, becoming the source of truth for the next quarter.
Identify repeating mistakes and emotional patterns (fear, anger, overconfidence after winning streaks, revenge trading) and make them conscious.
Convert each recurring pattern into an if-then rule with one actionable step to prevent its repetition, then update the trade plan and guardrails.
Limit changes to one to three rule adjustments per quarter and test them, rather than changing many variables at once.
Automating rules in a journaling/trading tool (Edge Flow) and reviewing an identity statement daily helps reduce reliance on willpower and memory.

Chapters

How many trades do you need before changing your trading plan?

Brad Goh recommends at least 100 trades or 3 months of data before changing rules, with a bare minimum of 30 to 50 trades to see anything meaningful. Below that threshold, adjustments are based on gut feeling rather than evidence.

What should you do when you add a new variable to your trade plan?

Treat the new variable as a hypothesis and retest the entire trade plan to prove or disprove it. Without this, you cannot truly know whether the change, such as a fair value gap entry or trailing stop, improved or hurt results.

What is the purpose of the quarterly review?

The quarterly review filters out short-term noise by reviewing every trade from the past 90 days. It reveals real patterns, mistakes, and emotional triggers, and produces a source of truth for converting recurring problems into if-then rules for the next quarter.

Full Transcript — Download SRT & Markdown

Speaker A

Most traders change strategy as often as they change their underwear. They just change it because they feel like they should change rules. You know, they strategy hop every single week because they see this new shiny holy grail strategy. And every single time

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they do that, they're self-sabotaging because they reset their competence level back to zero. And the other mistake is that when they hit a losing streak, they instantly assume their strategy is no longer working. When it could just be normal

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variance. It could just be because of the fact that the market is random. There is a random distribution between wins and losses.

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That is why I don't adjust my trade plan based on emotions. I adjust it based on data. I adjust it based on evidence. So, in this video, I'm going to walk you through how I personally tweak my trading plan to make it better, right?

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To improve it over time. And my rule is very simple. I don't change my trading plan as and when when I feel like it. I don't change it when I've lost 10 trades in a row. It just doesn't work that way. I only change

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rules when I've either 100 trades to review or I have at least 3 months of data.

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If you don't have 100 trades yet, you need at least 30 to 50 minimum trades just to see anything meaningful, right?

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Because like that's the sample size that is required for you to get a sufficient data, sufficient evidence to prove that your trading plan is not working or it can be better. And if you're below that that threshold, right? Below that 30 to

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50 trades, don't tweak the system at all, right? Because when you do, you're just tweaking it based on your gut feeling. You're just tweaking it based on what you think it's not working within your trade plan, right? Like I said, just continue focus

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on executing more consistently and collecting more data because like I said, really anything less than 30 to 100 trades it it's like just not meaningful enough. It's just not big of a sample size for you to make decisions

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on. And one more thing, when you introduce a new variable into your trade plan, like for example, you come here, you add it, maybe you add a new charting process, or maybe you add a new entry criteria saying that I only want to enter after I

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see a fair value gap, right? Something simple just like this. Bear in mind that you have to test the entire trade plan again just to prove the hypothesis.

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Okay, because you want to treat it like a science, not as like an art, right?

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And in a science, what happens is that you have a hypothesis, right? Like this is what you think could potentially work, and then you test the hypothesis.

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And then based on data, you can find out whether the hypothesis is actually proven to be right or proven to be wrong. And then you test another hypothesis. It's the exact same thing right here. When you introduce a new

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entry criteria, a new exit criteria, or a new way to manage a trade, bear in mind that because that haven't been tested yet, now you need to undergo another round of testing to prove that variable actually works, to prove that

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the fair value gap actually works, to prove that, you know, trailing stop loss actually works.

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Okay? So, this is something that a lot of traders tend to overlook, right? They don't realize that when they introduce something new, they have to test out the entire trade plan again. Because if you don't, you will never ever truly know

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what worked and what didn't work. So, quite simply put, remember data isn't just for vibes, isn't just for validation, it's for you to make data-driven decisions, right? And quarterly review is the perfect time frame to do so, right? Because it

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filters out all the short-term noise and it reveals to you the real patterns. So, basically, let's say today is March 31st, right? It's the end of quarter one. This is where I come over to my journal and I'll review every single

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trade I've taken in the past 90 days, in the past 3 months. All right, so you once again you want to make it a habit.

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You want to make it a routine. So, at the end of each quarter, right, January, February, March 31st, right, March 31st is the last day of quarter one, you want to go and look at all the trades that you have taken in the past 3

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months. Okay, go and review each one very, very in-depth. All right. So, this is where I literally block out one entire day just to do this properly.

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So, this is where after I'm done reviewing every single trade I've taken in the past 3 months, I go on to my notebook and I I go on to my quarterly review template. Okay, so it will probably look

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something like this. Okay, like this is the quarterly review template and then I will fill it out based on, once again, the data that I've reviewed over the past 3 months, right? I can figure out what are the wins, the loss, the break

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even, so and so forth. Fill out all Fill out all of these necessary details right here. And once I'm done filling it up, it will look probably something just like this.

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Okay? So, this is important, right, because what you're doing is that you are extracting the feedback from every single trade that you have taken. And when you do that, you're able to find out, once again, what works, what doesn't works,

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right? What are the variables that influence the results. So, once you do that, this entire quarterly review document right here, it becomes your source of truth for the next 90 days. Which means that you want to like just go and reflect on,

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okay, what are the things that perform well and what are the things that didn't perform so well, and then you want to do more of the things that perform well in next quarter and you want to do less of

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the things that didn't perform well in the next quarter. Right? In fact, you should even think about how you can eliminate all the mistakes that you committed in the past quarter.

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So, my process is very simple. I review this entire quarterly review template, you know, after I'm done filling it up, I use this as a source of truth, and then as I'm doing that, as I'm reviewing this quarterly report, I want to

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identify the repeating patterns. What are the mistakes that I tend to commit over and over again? What are the emotional patterns that I tend to experience over and over again, right?

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Whenever I feel fear, I do this. Whenever I feel angry, I feel this. I feel like after uh after I win three trades in a row, I always got overconfident. I always, you know, start to size up, even though my trade plan

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tells me not to. And if you keep on doing those stuff over and over again, that's a pattern, right? So, you want to identify the patterns you tend to repeat. Because when you start to make the unconscious conscious, now you are trading the

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reality of the market. Now you are no longer trading a perception of the market. Now you are actually seeing the market for what it is. Now you are actually seeing the world as it is, rather than what you think it is, right?

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So, identify the repeating patterns, and then once that's done, I want you to convert. I want you to convert each pattern into an if-then rule.

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All right, so here's a cheat sheet that I've compiled in for you, right? So, it's a very simple cheat sheet. I'm going to go through it with you later on, but basically, your goal is to turn each problem into solution, to turn each

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pattern into a action that you can take to prevent yourself from committing that same pattern, to prevent yourself from going unconscious again.

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And then you also want to have like one actionable step that prevents the same mistake from repeating.

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And then once done with this, right? Once you have the problem and you have developed a solution to fix the problem, you want to update your trade plan, right? You have to update your trade plan with the solution. You want to

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adjust your guardrails to ensure that you adhere to your rules, to adhere to your risk parameters in the next quarter or so. And then you run that that new solution, that new variables for the next quarter.

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And when you do that, you are pretty much making decisions, you are tweaking your trading plan based on data, not based on vibes. Right? At the end At the end of next quarter, you do this exact same five-step process again. Right? So,

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let me just quickly review like just quickly recap the entire five-step process. Basically, you want to review and fill up a quarterly template just like this. And then you want to identify the repeating patterns. And then you want to convert each pattern

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into an if-then rule just like this. If this happens, then I'm going to do this.

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If that happens, I'm going to do that. And then you want to implement it in Edge Flow by tweaking your trading plan or adjusting your guardrails.

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And then you want to run it for the next quarter. That's it. And then you re-evaluate and you do that the do the exact same thing the next quarter at the end of the next quarter itself.

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Now, to help you do this, right? To me, I really believe that the hardest part is being conscious.

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Because when we are stuck in the trends, you know, when we are stuck in that cycle of unprofitability, we tend to commit the same emotion same actions, we tend to experience the same emotions without realizing it.

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Right? So, like I said, the hard part is really just getting conscious. The hard part is really just building the awareness.

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The easy part is to solve that problem itself, right? Because once you have the awareness, you know exactly what you need to do to prevent yourself from making the same mistake, to prevent yourself from getting stuck in the exact

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same pattern. So, in order to help you spot the patterns, I've come up with you like this little cheat sheet right here.

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And I pretty much categorize the patterns into these different categories right here. All right. So, there are your technical patterns, which is in terms of how you map out your process, your entry criteria, your exit criteria, the issues. Like I said, this is heavily

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focused on how you build your trading plan in the first place, right? How you map out your higher time frame, how you map out your point of interest, what is your entry criteria, whether the liquid liquidity ship entry model actually work

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in this condition, in that condition. So, when you do your quarterly review, go and spot this out, right? This should be the first priority, right? Go and find out which part of your trading plan is no longer working, which part of your

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technical analysis process do you need to refine, right? So, that you can perform better in the next quarter. Next is timing.

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Timing-wise, right? Once again, look at all the trades that you have taken. If you have taken all of them in the London session, then go and evaluate whether London session has been profitable for you or not. If you you're just like, you

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know, trading at any time and every time, then you can see and judge based on each trade what time they are in, and then what is the session that is the most profitable for you. For example, you take 20 trades, and out of those 20

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trades, uh some of them were taken in London, some of them were taken in New York, some of them were taken in Asian session, and you found out that 15 of those 20 trades tends to work in your your the way that you envision it

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for it for the it to work in, right? Like, you tend to win those trades when you take them in London session, then perhaps that's a data point that tells you that you should be trading more during London session. And then next is

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emotional, right? Like I said, until you make the unconscious conscious, it will ruin your life and you will call it fate. You need to make sure that whenever you do your reviewing, right? You go and review what was the emotion that resulted in

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you taking the action that resulted in you getting this outcome. If you lost that trade, okay, what was the emotion that you were experiencing saying at the start of the trade itself? What were the emotion that you feel when you got out

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of the trade? Because that big loss could have been avoided if you just stopped after the first loss. But because you kept getting angry, you kept trying to get back at the market, you kept revenge trading, you kept feeling like, you know, you are

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right and the market is wrong. This caused you to go into this downward spiral where you incur even more losses.

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Right? So, when you do that, what happens is that you trace the problem all the way down to the root cause. And the root cause is your emotion, right? It's the fact that you got angry. It's the fact that you choose

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to put your ego over making money. Boom. That's a repeated behavioral trigger that you can strive to to be a more aware of the next time it actually arrives. Right? I revenge trade after a losing streak, example.

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Another pattern you can spot for is risk, like in the way you actually manage your risk, right? Sometimes you get inconsistent because you start feeling emotions, right? You start feeling like you're on top of the world and now you're sizing up. Or same thing,

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after you lose a few trades in a row, you feel like you want to get back at the market, right? You want to, you know, make back the loss. You start sizing up. Okay? So, once again, all of

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those are patterns that you want to be spotting. And also trade management, how you manage the trade, how you manage winners, how you manage the losers, how you manage the existing open position.

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Okay? So, ask yourself this. And then execution quality, right? Whether you're taking the right setup, whether you're following your trading plan. And then environment and context, right? External conditions that change performance. It could be physiological, it could be

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physical, it could be digital, it could be social, it could be internal, right? There's like different types of environment. It could be your workspace not being optimized, it could be when you are trading, when you are stressed, and you are have some form of problems

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in your life, you know, you you tend to not perform as well as you like to perform. Or you could be trading during these certain market conditions, you know, when Trump is making the market go super duper volatile and there's a lot of

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uncertainty in the market, and the trades that you take in these sort of market conditions tend to perform badly.

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Right? So, all of these are environment, all of these are context. Right, so you can just spot the pattern and just put it in here.

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Once you found the repeating patterns, your job is to turn each pattern into a solution.

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Like I said, pattern is the problem, solution is the fix. Right, the rule is the fix.

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And this is where I will go through the if-then sheet with you. Right, if-then cheat sheet.

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Like I said, once you spot the pattern, that's the first step. Right, the first step is always becoming conscious. Because if you don't become conscious, you will keep on staying in that trend state.

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Right, you will keep on staying in the trend state where you just do the same thing, get the same results. Right, it's so it's the same thing that you're just going to be continue running the same program over and over again. And if you

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run the same program over and over again, guess what? You are going to get the same outcomes over and over again. So when you start becoming more conscious, when you start becoming more aware, right, when you start identifying these

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patterns right here, what happens is that now you're waking up. Now you're no longer sleeping, now you're no longer in a dream like state, now you're waking up. And now you're like, "Okay, cool.

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This pattern needs to go. I need to fix this shit." Right, and then this is where you can develop solution, right, which is the next step, so that you can get out of this state that you are in. Right, so that you can

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break out of this pattern, break out of this loop. So here's the key, no more than one to three changes per quarter.

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If you change too many variables at once, you're going to create chaos. And you will never ever know what actually caused improvement. Like I said, every single variable that you change, you need to test it out. You need to undergo

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another cycle of testing to see whether that variable actually works or not, whether it actually has a significant impact on your trading results or not.

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So I will recommend you to change maybe just max three variables inside your trade plan.

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I would advise you to change one, right, but if you want to change more, I'll say three is like the maximum you could go.

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Uh and then just test it out for the next quarter. And then at the end of the next quarter, you get out your results again, you do your same quarterly review, and then this is where you can come to a conclusion on whether the

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three variables that you have changed perform make your trade plan better or not. You know, make your trading results better or not.

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And if not, maybe you want to change another three variables, right? For the next quarter. And then just test the next uh the next three variables in the next quarter itself.

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So, it's very simple, right? Like I said, just want to identify the rules that stop the biggest leak. Okay, if you just have to fix three things in this quarter, go and find out what are the biggest three patterns that cause you to

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lose the most amount of money, and just focus on fixing those three things. It could be a combination of technicals, emotional, uh execution quality, uh environment, risk, uh timing, right? You just find the three variables and just test it for the next quarter.

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And that's how you find like a scientist, not react like a gambler. And when it comes to the solution part, right? The next question you might be asking is, "Okay, Brett, cool. I've identified the pattern. Now, how do I

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develop the solution to solve that pattern?" Very, very simple. You use what I call the if-then framework. This is a very mechanical system, okay? Once again, super duper mechanical system.

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First step, identify the pattern. Once you identify the pattern, then you can develop the solution.

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And how the if-then framework works is if the problem occurs, then I'm going to implement a solution.

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So, if my performance is profitable, but my results are inconsistent, then I will tighten discipline. I will take fewer trades. I would maybe trade within a shorter window. I will stick to my hard stop after a max loss.

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You know, I will just continue to just like I will not continue trading after a losing streak.

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If win rate it high, but your average R is low. What that means is that I can win trades, but then over the long run I might not be profitable because like my the amount of money that I make when I

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win is always much more lesser than the amount of money that I lose when I'm wrong, right? So, maybe I need to stop cutting my winners.

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Maybe I need to reduce early exits. Maybe I need to delay partials. Maybe I need to just let my winning positions run.

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If win rate is low, but average R is strong, then this is where I can think about how I can increase my win rate, right? Maybe I need to improve improve selectivity, right? Maybe I need to only just focus on the A+ setups.

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If risk deviation is high, consistency is low, then standardize sizing, so on and so forth.

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For every single pattern that you spot in your trading quarterly review, that is going to be a solution to fix that pattern.

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And if you don't know what it is, thank god for AI. You could just send it to AI, right? And if you're using Edge Flow, you could just send it to Flow AI.

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Yeah, you could just send Flow AI and just say, "Hey, Flow AI." Or any AI software that you're using out there, whether that's ChatGPT or Google Gemini or Claude, right? Whatever it is, just ask the AI.

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"Hey, AI, I have completed my quarterly review and it seems like I tend to revenge trade after my first loss. This is the pattern that happens over and over again. How do I fix it? What's the solution that uh will will prevent me

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from actually committing this mistake again?" And when you ask that, AI is so advanced nowadays where it will give you like the the right textbook answer, right? It will tell you that, "Okay, cool. You revenge trade after your first loss. Now

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you might want to implement like a hot stop after your first loss, right? Maybe you want to size down after your first loss." Whatever it is, whatever they suggest you, and that is your then framework. That is your solution, right?

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So, very simple. Like I said, the hardest part is to just become aware of the problem in the first place.

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And then, once you got aware of the problem, you can just send it to AI and then you can just ask it to like present you a solution. And then when you have the solution, like I said, just run it

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for the next quarter. Okay. When you have the solution, in order to help you run it to the next quarter, you should use Edge Flow in some way, shape, or form, right? So, for example, in this case, if performance is profitable, but my

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results are inconsistent. This is where I want to take fewer trades, and I want to have a shorter time window, or I want to stop after max loss. This is where, right? Once you've decided your rule changes, the one to three variables that

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you want to be testing in the next quarter, you want to lock them in your system so you're not relying on willpower or discipline. And Edge Flow helps you do that, right? So, this is where I can come in here, and I found

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that, okay, this is the solution that I want to be taking. So, this is where I will update my guardrails. Maybe I actually go from five trades a day, I want to take fewer trades for the next next quarter, right? I can just set it

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to three. And then maybe I want to make sure that I stop after I only lose $300.

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Now, I'll change that as well. Okay, so, you can either update your guardrails here, or you can update your trade plan inside your Edge feature itself, right? So, maybe you want to test out the fair value gap, right? So, this is where I

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can put it in right there. Or maybe you want to change your trade management method.

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Maybe you want to try um set and forget instead of you know, like taking partial profits for the next quarter, right? So, this is where I can change your rules. Okay, you can adjust your trade plan in here.

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But like I said, the goal here is for you to do something, right? Whatever it is, just do something, because nothing changes if nothing changes.

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Once you have developed the solution, the three variables, go and implement it into your trading system. You can either adjust your rules inside of Edge, or change your guardrails. Right? That's it. Change your guardrails, or adjust your Edge.

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Because the last thing you want to do is to be relying on memory. Right? You don't want to be doing stuff like, okay, cool, I'm just done with my reviewing right now. And I know that this is the

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stuff that I should be doing in the next quarter. And now I'm just going to chill. Okay, cool. I already done my review, right? Cool. Next.

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Knowledge itself is not power. When you do that, what you're doing is that you are just trying to remember to do this in the future. What you really want to do is to do something with it. Is to

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bake it into your system. Bake it into Edge Flow. Because when emotions hit, you're going to be forgetting about all of these stuff right here. You're going to be forgetting about all of these like variables that you want to test out in

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the next quarter. Right? So, bake it into your system because the system is what keeps you consistent.

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Oh, that rhymes. Okay, so that's that. After you implement the rule changes, you might want to lock in one theme for the next 90 days, right? Once again, not five or 10 different goals, just one focus. And you could write it at the

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top of your quarterly review template just like this. And you might want to like turn it into like a identity rule that you repeat.

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Like, I'm the type of trader who reads the same every single trade. Or I'm the type of trader who shuts down after a max loss, just like this. So, this is the identity statement. All right, because when you start putting the

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identity statement down right there, and if you can, try to review it every single day, what happens is that you are reprogramming the subconscious mind.

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Because right now, to this day, you might be the guy who tends to revenge trade after a losing streak. You might be the guy who focus on, you know, your ego rather than making money. But the minute you type this identity statement

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in, you are unconsciously telling your body, telling your mind, telling your subconscious mind that I am the type of trader who shuts down after max loss.

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And when you do that, you have just undergone an identity shift. And we always act in accordance with our belief and identity.

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So, if I'm the type of trader who shuts down after max loss, I'm not going to be the guy who revenge trade after losing streak. That's not me anymore, right?

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That's the past me. Now, I'm the type of guy who just close my trading platform after I hit the max loss.

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So, you want to put some form of identity statement just like this. And that, my friend, is how you evolve as a trader.

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Like I say, you don't the G hard, you don't panic after a losing streak, you don't make random tweaks just because you feel like something is off.

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You review a real sample size, whether that's 100 trades or 3 months worth of trading data. You find the recurring patterns, you convert them into one to three rule changes they can take for the next quarter, you bake them into edge

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flow, you build them into your system, and you run the experiment for the next 90 days.

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And then at the end of those 90 days, you review. You do that exact same process over and over again, and that's how you trade like a scientist, not like a gambler.

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And that's the difference between a professional trader and a retail trader. A professional trader would do what's required to succeed, and this is part of what's required. It's reviewing the tape and just continue iterating on the trade plan and just continue getting better,

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just dedicating themselves to the craft itself. Like I say, when you do this every single quarter, your edge doesn't just works. What happens is that it compounds. All of these little improvement that you're making in your trade plan, it tends to start

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compounding over time. It tends to result in exponential growth, right? The only reason why I'm making a lot of money right now is because of all of these reviews that I've done in the past 7 years of trading.

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And all of these tiny little improvement, tiny little feedback allowed me to get to where I'm today.

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And I'm still doing the exact same process right now, and I'm still trying to level up, still trying to improve and iterate my trade plan.

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That's success in trading. That's what separates the average traders from the great traders.

Topics:trading strategytrading journalquarterly reviewdata-driven tradingtrading psychologybacktestingsample sizetrade planrisk managementBrad Goh

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