[Calls not answered /emails taking 24 hours or more for response]

Probably issues with respect to staff having to work form home, reduced staffing numbers etc with the Covid crisis.

[Can you be profitable without backtesting?]

1 hour ago, dmedin said:

Actually with the Trading View platform you can draw long/short positions on the chart to backtest, so you don't even have to learn programming.  (Although that would obviously be very useful too)

1 hour ago, THT said:

I've always back tested over a min of 100 trades - manually on a chart not via a comp, which invariable covers numerous years if done on daily charts

I also make sure I test it through a bull, bear and sideways market too to see if any affect the method - again you'll have to define how you classify those types of market.

Its all about having a positive expectancy which then gives you the confidence to trade it too

 

Fair play to you. think the only way I could do 100 would be to run some kind of script, which I don’t yet have the skill to do (but I’m learning, check out  this video...

It would kill me to sit there manually going through and writing all everything that many times. There must be a systematic approach which can automate the data entry. I’m interested also, why you would test a strategy in a bear, bull and sideways market? When you conceive of the strategy, wouldn’t it be in a certain context anyway?

 

[Can you be profitable without backtesting?]

23 minutes ago, Caseynotes said:

Hi, the average retail trader is destined to lose precisely because they have no repeatable process that has been tested to prove positive expectancy. The cumulative R ratio vs the cumulative win rate plotted on the profitability chart is indisputable as to whether a strategy has a chance of being profitable or not trading live.

Backtesting is not actually such a chore as a simple eyeball backtest of 20 trades is usually enough to rule out most no-chance strategies before moving on to forward testing on demo.

See more in this thread.

 

Thanks for the reply and the link. A simple eyeball of how a strategy has performed about 20 times or so in similar conditions seems about all I can manage. 

[Can you be profitable without backtesting?]

Hi folks.

I'm trying to get my head around the lengthy process of backtesting strategies. I know that a lot of people find this is a very important part of their trading, and are keen to know that their strategy will be profitable before they engage with it.

I'm keen to learn how people view this.

Back testing takes an enormous amount of resources in terms of time and if someone is going to be managing their trades anyway and using price action, observation of technicals and to justify when to enter and where to exit, is it necessary to define some rule which, in terms of supply and demand is arbitrary, is weighted towards the past and doesn't add to the recognition of what you are seeing?

Aren't defined trading strategies (enter when market trending, at test 50 EMA retrace, with a trailing stop of 3 ATR) simply an effective way of keeping the trader disciplined to principles, rather than a rigid holy grail rule which one can plug into an algo, set and forget and not have to manage?

It feels that it is more important to know why a strategy works or doesn't work, to know what the history R ratio has been.

If you accept the idea that the average retail trader has to manage their trade anyway, that breakouts occur, pullbacks occur, markets trend, and markets range, risk needs to be quantified and managed and targets need to be set per principles,  then what difference does entering lots of data on a spreadsheet of 1 way of decoding the decision pathways above, do to a retail traders bottom line? What does it do if they do this repeatedly? Does it depend on personality? Can you be a profitable trader without it and are you likely to blow up an account if you don't?

[Closing the Gap]

Thanks guys, those are all really useful directions.

So there's more than 1 type of gap? Who knew? Meh. Back to the books and YouTube for me..... I'll get there.

[Closing the Gap]

Hi folks, apologies if I've missed any etequette. I'm new in here, and fairly new to trading.

I'm after some advice

I was going well. I managed to increase the trading capital by about 50% in 6 weeks, by using a Trading the Gap strategy (plus 1 or 2 major economic announcements such as an interest rate or election result). Basically, the strategy went, that I'd wait for the opening bell on the NYSE and then simply trade, on a 5 minute chart in the direction to close the gap, provided that the gap was within 50 points. I started with a small amount and gradually pushed until I was closing the gap with as much as 35 contracts per pip sometimes. I looked to be in and out of the trade within 10 minutes.

It seemed to work most of the time and when the trade went South, I'd pull the plug quickly.

Then, it just seemed to stop working, and in the last 10 weeks, Ive been on a continuous loosing streak and have been dying with death by 1,000 cuts. I'm still 22% up on my initial deposit.

I decided to backtest the strategy over the last 2 months on the Dow (Dec and Jan) and the gap closed very few times and where it did close, a 1:1 stop would have been taken out first. I've stopped with that strategy for now, since it doesn't seem to be working but would love someone who has experience of trading a Gap strategy to give me some suggestions of what might have changed.

Like I said,I'm fairly inexperienced.