The correct way to backtest

2021年9月28日

Mistakes When Backtesting (Advice from pips of persia)

Looking only for where would I have entered
It’s not about WHERE you would have entered it’s about understanding market behavior
Ignoring losing scenarios
When you consistently do this you’re not use to seeing losses on live accounts. You are only use to seeing scenarios that play out while backtesting
These losing scenarios is where you will be able to learn more from because it challenges you to think more deeper as to how come this didn’t work
Ignoring emotions, trade management, set of rules, etc
WE FAIL TO TREAT IT AS IF IT WERE LIVE...write down your emotions, you have to treat it as if it were live
Play a trade out, consider how your emotions would be
Practice trade management..how would you play this trade out
Practice a set of rules (This will build your psychology over time)
Take into consideration time of day, day of week, session, etc.

Ways to backtest WITHOUT the replay button
The Aim of this style: to get your EYES use to seeing important patterns that pertain to your rules
Such as:
Market Behavior, IC+mitigation, manipulation, Wyckoff, Zones, impulses. Etc
Questions: Can you identify the story? Can you follow it?
Ask yourself why constantly
Define your set of rules