New Series
I have decided to create a new video series in which I give you an over-the-shoulder look at how I backtest and improve mechanical trading strategies.
In this first video I begin to code and test a free trading strategy found on the Forex Factory forum. It’s a strategy for trading Forex on a 4 hr timeframe.
The Rules:
Long Trades:
- The setup bar has to be above the 30 period EMA on the 4hr chart
- The setup bar has to be an Outside Bar
- The setup bar has to close above the open
- If all conditions are met then buy the next bar at the open
Short Trades:
- The setup bar has to be below the 30 period EMA on the 4hr chart
- The setup bar has to be an Outside Bar
- The setup bar has to close below the open
- If all conditions are met then sell short the next bar at the open
Stop losses and Exits were a little vague. So I plan to test a number of different methods I know have proven to work for different strategies in the past.