Newbie Question: What's the catch?

Hi,

I was just playing around with an expert advisor - Renko V.5 and plugged in
a 30 minute time frame and the account balance just climbs and climbs.

Like most things this is probably too good to be true.

Can some explain the catch to me or refer me to a thread.

Hi,

first, i don't know this EA, second, i m not sure what you did, so i won t be specific at all.

if you used MT4 backtester, the answer is pretty simple: unless you know exactly what you're doing (don't believe in the "modelling quality"), then the catch is the backtester itself. It seems to be there mostly to fool users.

if you were using the EA on live feed, unless this Renko is the holy grail, then it's probably because the market conditions were ideal for this EA. Run this EA over a long period of time that includes a fair amount of adverse days and you ll have a more resonnable picture of what to expect.

I found this EA in the list in the first part of the thread. It was backtested but on MT4 on a 30 min TF, but i haven't live tested it yet.

I agree with you I must test it on live data - I'm not setting my hopes on this, though since I won't learn much from it if I don't learn trading manually which is my current objective. I'm learning a lot from this forum already spent 25 hours or more reading I think.

thanks for your reply

I have test this EA for some time.It is really can get profitable effect.But it still has flaw,when its flaw emerge,if you don`t stop trade ,you will lose you profit very fast.(for example if you test it for EUR/USD from 4.6. 2006 to
4.10.2006 you will get very bad result.) To solve this problem, I want to change the trade type while the flaw emerge(change BUY TO SELL ,SELL TO
BUY) it will involve to analysis you account how to change when the EA is working .How to write the code to analysis your account? who tell me ?

the "catch" is fully explained here...

http://www.forexfactory.com/forexfor...ead.php?t=4446

Your and the oasz gave me the answer from 2 different angles. Thanks.
I read your methodology and it's very stringent, but as you say, I'm paraphrasing a bit, you only need one.

Hi Merlin,

It appears the link to the catch explanation is dead. Would you have another link? thanks

http://www.forexfactory.com/showthread.php?t=4446