Backtesting question

greetings traders, newbie here. Currently backtesting on EURUSD using D-4H-1H time frames. However, i feel day trading may be more suited for me .My intention would be to trade on 4h_1h_15m time frame. Do i need to backtest on this lower time frame, or would the information from the D 4H 1H be applicable on the lower time frames considering its the same pair?

I would back test on the lower time frames. The trends are not as strong the lower you go.

2 Likes

Why not just put 50-100 currency units in an account and “forward test”. In my opinion, back testing is a massive waste of time.

Learn the platform and how to place trades using a demo account and then just jump in. You won’t learn a single real lesson about trading until real money is on the line. Period.

Backtesting is only an indicator of the past, not the future, so use it with a pinch of salt as market sentiment conditions change over time, albeit chart patterns repeat themselves throughout.

If you’re going to enter the trade on the 15m chart, it would be sensible to backtest it as well, wouldn’t it?. I trade intraday using Daily, 4hr and entry on 1hr. If all three line up like ducks in a row, it’s a great trading opportunity.

1 Like

Backtesting surely can save you from making unnecessary losses. There are so many strategies that work for different people. You have to find the one that works for you. And I don’t think that there is any other way better than back testing to find out whether a strategy is worth risking your money or not.

Consider backtesting on lower time frames. You may get better results. Also, focus on understanding historical data. Watch the market trends. However, backtesting may not always work out for everybody. Strategies successful in the past might be a failure today. Thus fundamental analysis becomes very important in this case.

I have to agree with you. I always emphasize this fact to new traders. Demo practice is never enough.

Depends on your trading style and if you can see moves happening on those time frames.

If I can trade from retest then the risk is less so I should trade from retest after the breakout.