Backtesting helps you:
✔️ Test and refine strategies on historical market data, risk-free
✔️ See how your setup performs in different market conditions
How to backtest a strategy:
1️⃣ Choose a strategy.
Example:
🟢 Buy when EMA 5 crosses above EMA 20
🔴 Sell when EMA 5 crosses below EMA 20
2️⃣ Select an asset and timeframe.
Example:
Gold, 1-minute candles, 24 hours
3️⃣ Scroll back in time to hide future price moves.
4️⃣ Go through the chart one candle at a time.
When your conditions are met, mark entry/exit points based on your strategy.
5️⃣ Use tools like Excel or Notion to log key metrics:
- Entry and exit prices
- Net profit or loss (P&L)
- Market conditions
6️⃣ Review performance.
Analyze metrics like success rate, average profit/loss and drawdown to spot areas for improvement.
💡 Backtest your strategy in trending, ranging and volatile markets.
💡 Don’t peek at future prices to avoid hindsight bias.
🔗Click here to register 👉 https://olymp.gl/BuOqg
⚡️ @olymptradersignal
