For the most part that is what it is. The important thing to remember is to be honest with yourself. Sometimes when back testing a system I will look at the indicators seeing that they have given a signal to go short but I will have taken a peak and seen that in fact the trend continued long or vice versa. At these times it is vital that you be truthful with yourself and not try to find things to justify why you wouldn't have gotten into that trade. If your indicators got you into the trade you are in the trade. The easiest way to not do this is to make sure that you are only going forward one candle at a time so that you can't see what the future of the chart holds.
If you know any programming you can use meta trader or Dealbook to code in the parameters of your trade and use that to back test. This takes away the guesswork and goes faster.
Also too, take into consideration that back testing won't guarantee what the results of your system will be. It just shows the results of what your system would have gotten in the past. This basically helps you to understand your system more (faults and all) so that you are aware of it while trading and to give you an idea of what your system is capable of.
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