Hey traders,
This post is intended for those of you who like to know the exact odds and expected value of the trades you take, and our opinion on why back-testing should be a PRIORITY for your trading.
Whilst we personally back-test and execute algorithmically, this never used to be the case.
In the early days we would back-test manually using Bloomberg Terminals at University (and later when working for an investment bank), and checking these against other free sources of data such as TradingView (although we do admit that TradingView need to get their acts together and start offering more data!).
So we know that whilst it can be hard to find quality chart data which dates back further than 2-3 years, it's certainly possible! And you absolutely should be spending the vast majority of your trading hours with your head in an Excel sheet noting down every trade within your strategy, because knowing your set-up is vital.
The truth is that the vast majority of trading success comes down to one thing... data!
Markets repeat themselves over and over again, and unless you want to take many live losses, the best way for you to learn how price behaves is through manual back-testing. By doing this you're setting yourself up for success. You're setting yourself up to have an edge over the markets.
Some newer traders shy away from back-testing because they think it's too difficult or technical, but it really doesn't have to be. If you have the determination, focus, and will-power then you can very easily back-test all of your ideas and begin turning them into well-rounded strategies which you can trade with utter confidence.
And the best thing is, once you've done the hard work all you then need to do is follow your rules and execute.
In fact, one of our best strategies is also one of our oldest. We haven't altered the rules of our GBPUSD edge for years, and yet it's still churning out excellent performance/drawdown figures.
This post is intended for those of you who like to know the exact odds and expected value of the trades you take, and our opinion on why back-testing should be a PRIORITY for your trading.
Whilst we personally back-test and execute algorithmically, this never used to be the case.
In the early days we would back-test manually using Bloomberg Terminals at University (and later when working for an investment bank), and checking these against other free sources of data such as TradingView (although we do admit that TradingView need to get their acts together and start offering more data!).
So we know that whilst it can be hard to find quality chart data which dates back further than 2-3 years, it's certainly possible! And you absolutely should be spending the vast majority of your trading hours with your head in an Excel sheet noting down every trade within your strategy, because knowing your set-up is vital.
The truth is that the vast majority of trading success comes down to one thing... data!
Markets repeat themselves over and over again, and unless you want to take many live losses, the best way for you to learn how price behaves is through manual back-testing. By doing this you're setting yourself up for success. You're setting yourself up to have an edge over the markets.
Some newer traders shy away from back-testing because they think it's too difficult or technical, but it really doesn't have to be. If you have the determination, focus, and will-power then you can very easily back-test all of your ideas and begin turning them into well-rounded strategies which you can trade with utter confidence.
And the best thing is, once you've done the hard work all you then need to do is follow your rules and execute.
In fact, one of our best strategies is also one of our oldest. We haven't altered the rules of our GBPUSD edge for years, and yet it's still churning out excellent performance/drawdown figures.