I’m starting to get the hang of Forex Tester. I did my first test set of 159 trades. I wasn’t using a solid strategy, I just wanted to figure out how the program works and how to set everything up.
Forex Tester is better than I initially thought. One feature I like is
that you can look at multiple time frames at any time during the testing by clicking the time frame buttons at the top.
Here are the results of the first run. Not too bad considering I wasn’t really using a real strategy.
The pips are a little off because of the decimal point format of the data (move the decimal over 2 places to the left when looking at pips, ahhh, now it makes sense huh), but the net effect is that I made $625 in about 8 months, starting with $10,000. I had almost the same number of winners as losers and my account was negative only once during the testing period.
I was using the 62 EMA, 200 SMA and 800 SMA. When they were 62>200>800, I would buy every time price hit the 62 and formed a reversal candle pattern like a doji or twin towers. My stop would be below the last swing low. If the swing low was too far away or price didn’t form what seemed like a reversal pattern I would pass on the trade. Same thing for sells, but in the opposite direction.
Now my plan is to find a strategy that I am interested in trading and testing that rigorously, to the tune of 1,000 trades as a sample size. This is actually fun because I get to try out all these different trading techniques without risking a dime AND I can control the speed at which the bars appear. So it’s not like live demo trading where I have to wait for the bars to appear in real time.
You are probably wondering where I am getting the data…Forex Tester comes with some data but you can download data for most of the major pairs here: History Center. Of course no data is 100% clean, but these data sets seem to be pretty good. The best part is that the data is free!
Keep an eye out for more of my testing runs.
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