High quality (Clear) vs Low Quality (Unclear, wicky, random, guessing) Setups in Our Trading High quality clear (HQC) setups are best representations of your EDGE, they allow you to feel confident in the MOMENT of placing a trade, and you can feel relatively good about it even if it’s a loser, because you know you traded in clear market environment and did...
On the chart, Oct '94 is a pre-test of 92.26 I'm not sure it's a good example here, but it'll suffice to explain this easy concept. Again, it's not the system's behavior principle, the reason of this microstructural phenomenon is all of us. Forgot to mention before... There's no such thing as, "A new wave started after "almost" hitting a level". NO. In 100%...
A common mistake that traders make after learning any kind of trading setup is jumping into backtesting using a replay tool, or even live trading. However, if you think about it, trading is very much about pattern recognition. And when you force yourself into live trading without a proper understanding of what your patterns look like, most likely you’ll need much...
Hey Traders, Today I wanted to follow on from the fantastic amount of comments that we are receiving from the previous video, "stop strategy jumping." It seems that so many of you took a whole heap of value from that video and for that I am very thankful and to everyone who reached out and told their story or let me know that it really touched them. As highly...
Backtesting is a manual or systematic method of determining whether a trading strategy or trading setup has been profitable in the past. A trader should backtest a strategy to help determine if a trading strategy is likely a waste of time and money, or if it shows promise and profitability in a variety of markets. While you can get software that does systematic...
In my earlier article, " Proving Your Trading System with Backtesting ", I demonstrated how, in the Futures market, you could backtest your trading system, see what works and what doesn't, change your variables, and rinse & repeat until you have a winning trading formula. You GET this winning formula by torture-testing (ahem, *back*testing) your system under...
In my earlier article, " Proving Your Trading System with Backtesting ", I outlined the HOWs and WHYs of backtesting. Does your trading system work under all conditions? Under what conditions might it *not* work? Can you remove those instances from your plan? Under what conditions might you *improve* your win rate? In another article, " The Unexamined Trader ",...
Wouldn’t it be great to see the future? To see where turning points in price will occur with a high degree of accuracy? To see if a trading system that you developed or bought or learned actually works? Well, you can, with a method called BACKTESTING. Backtesting performs three important functions: 1: It helps you IDENTIFY the reliability / win rate of your...
I thought it would be fun to share a backtesting video. Video time is limited so I couldn't get a full session recorded. I know technical analysis is only part of the picture but this is a fun exercise.
My first strategy for testing publish on TradingView. pls skip this everybody. Thx.
This is a monthly correlation of the SPX and Oil (CL). The divergence is clear at the April highs. *I have also included EURUSD as of importance, perhaps primarily so now.