most forex back testing is useless

Back testing is useless because in times of expected rises in interest rates, the pair performance may show over optimized results, but these back tests will be hugely disappointing in the future, if if interest rates expectations change in the future.

I don't back test eas , I use them for their functions ,like a trade manager EA.


Most back testing is useless

http://www.trade2win.com/boards/educational-resources/223150-most-back-testing-useless.html

BACK TESTING is usually all technical, it is useless, because every year the economies are different.Back tested eas on data from 1999 to 2006 failed horribly in 2008 to 2012.



The following information was available on november 20, 2017
Professionals trade forex when there are expected rises or falls in interest rates, as a result of expected rises in interest rates, Eur/usd and gbp/usd have fallen in 2018.They set a target of 1.10 for eur usd, I don't know if this will make the target.

Goldman Sachs Predicts That the Fed Will Hike Interest Rates Four Times in 2018

Goldman Sachs said it expects a tight U.S. labor market and more normal inflation picture will lead the Federal Reserve to hike interest rates four times next year.

If you had listened to the big boys like Goldman Sachs and interest rates expectations, search for it google, for U S is expected to raise interest rates 4 times this year, and gone short on the weekly time frames on Eurusd and GBP/USD , you would have made over 2,000 pips on both of them. This expected raise in interest rates caused the dollar to get stronger, "interest rates expectations and how they drive dollar on weekly and monthly basis".This is not something new to fx trading, it has been going on since the 1970s, as far as I know. Interest rates expectations and economies change over months and years.This is how big currency traders trade.It worked 50 years ago and it worked in 2018.This is why dollar got stronger.The market does the same thing , over and over again.

Attached Files:
 
back testing is only for checking functions of an ea like the following functions on a trade manager, that these functions work correctly.

input bool CloseAllMarket=false;
input bool CloseAllPending=false;
input bool CloseAllMarketAndPending=false;
input bool PlaceSLTPForPending=false;
extern int StopLoss=100;
extern int TakeProfit=100;
extern int BreakEven=100;
input int PointsToSupRes=50;
input bool UseMartingale=false;
input bool WorkAsTradManager=false;
extern int ResetLossAfterXPipsInProfit=80;
extern int AcceptLossPips=10;
input bool MaxLot=2;
input int MaximumOrdersPer24=2;
input int MagicNumber=11011;
extern int PartialDistance=1000;
input double PartialPercent=50;
input string StartTime1="09:00";
input string EndTime1="13:20";
extern int StartTrail=100;
extern int TrailingStop=50;
extern int TrailingStep=10;
extern int PipsTonEntryLong=30;
extern int PipsTonEntryShort=-30;
input string MondayStartTime="10:00";
input bool UseCloseFriday=true;
input string FridayCloseTime="19:00";
 
  • Like
Reactions: DBLESSED1

Ary Barroso

Active Trader
Jul 9, 2017
908
70
39
33
Back testing is useless because in times of expected rises in interest rates, the pair performance may show over optimized results, but these back tests will be hugely disappointing in the future, if if interest rates expectations change in the future.

I don't back test eas , I use them for their functions ,like a trade manager EA.


Most back testing is useless

http://www.trade2win.com/boards/educational-resources/223150-most-back-testing-useless.html

BACK TESTING is usually all technical, it is useless, because every year the economies are different.Back tested eas on data from 1999 to 2006 failed horribly in 2008 to 2012.



The following information was available on november 20, 2017
Professionals trade forex when there are expected rises or falls in interest rates, as a result of expected rises in interest rates, Eur/usd and gbp/usd have fallen in 2018.They set a target of 1.10 for eur usd, I don't know if this will make the target.

Goldman Sachs Predicts That the Fed Will Hike Interest Rates Four Times in 2018

Goldman Sachs said it expects a tight U.S. labor market and more normal inflation picture will lead the Federal Reserve to hike interest rates four times next year.

If you had listened to the big boys like Goldman Sachs and interest rates expectations, search for it google, for U S is expected to raise interest rates 4 times this year, and gone short on the weekly time frames on Eurusd and GBP/USD , you would have made over 2,000 pips on both of them. This expected raise in interest rates caused the dollar to get stronger, "interest rates expectations and how they drive dollar on weekly and monthly basis".This is not something new to fx trading, it has been going on since the 1970s, as far as I know. Interest rates expectations and economies change over months and years.This is how big currency traders trade.It worked 50 years ago and it worked in 2018.This is why dollar got stronger.The market does the same thing , over and over again.

Attached Files:

I think, demo is 1st choice than we need to practice with the back testing! I spent more than 6 months in demo before practicing back testing with a particular trading system.
 

J_C_Anderson

Trader
Aug 15, 2018
64
9
19
42
To my mind, back testing TA-based stategies can be usefull, as similar patterns may appear from time to time. For exapmle, you can find breaching of trendline on every chart. So, back testing is good idea to find out "personal features" of currency.
 

Ary Barroso

Active Trader
Jul 9, 2017
908
70
39
33
To my mind, back testing TA-based stategies can be usefull, as similar patterns may appear from time to time. For exapmle, you can find breaching of trendline on every chart. So, back testing is good idea to find out "personal features" of currency.

Yes, I think so; time frame is an important calculation in this case! Thanks for your opinion.
 

DBLESSED1

Trader
May 4, 2019
1
0
7
42
back testing is only for checking functions of an ea like the following functions on a trade manager, that these functions work correctly.

input bool CloseAllMarket=false;
input bool CloseAllPending=false;
input bool CloseAllMarketAndPending=false;
input bool PlaceSLTPForPending=false;
extern int StopLoss=100;
extern int TakeProfit=100;
extern int BreakEven=100;
input int PointsToSupRes=50;
input bool UseMartingale=false;
input bool WorkAsTradManager=false;
extern int ResetLossAfterXPipsInProfit=80;
extern int AcceptLossPips=10;
input bool MaxLot=2;
input int MaximumOrdersPer24=2;
input int MagicNumber=11011;
extern int PartialDistance=1000;
input double PartialPercent=50;
input string StartTime1="09:00";
input string EndTime1="13:20";
extern int StartTrail=100;
extern int TrailingStop=50;
extern int TrailingStep=10;
extern int PipsTonEntryLong=30;
extern int PipsTonEntryShort=-30;
input string MondayStartTime="10:00";
input bool UseCloseFriday=true;
input string FridayCloseTime="19:00";
Thank u am really gaining from all the contributions u r making
 
Most trading EAS sold with back tests are scams. See the chart proof belowView attachment 13923
The scammer never traded the EA with real money , he never showed slippage , re quotes ,internet disconnections , non fills and many other issues like spread widening and metaquotes virtual dealer plug in delays.

He was just showing fake unreal profits.
 

Ary Barroso

Active Trader
Jul 9, 2017
908
70
39
33
The scammer never traded the EA with real money , he never showed slippage , re quotes ,internet disconnections , non fills and many other issues like spread widening and metaquotes virtual dealer plug in delays.

He was just showing fake unreal profits.

That’s very normal but new traders need to count this point during their EA searching process!
 
That’s very normal but new traders need to count this point during their EA searching process!

Actual esults are much worse on actual trading .Most traders can not replicate demo results or back testing results on live accounts.On live accounts ,trading psychology , execution liquidity and human commands element is involved
 
To my mind, back testing TA-based stategies can be usefull, as similar patterns may appear from time to time. For exapmle, you can find breaching of trendline on every chart. So, back testing is good idea to find out "personal features" of currency.


Trend line is after the event, so it is too late to make money.You will make more money as paid forum poster.