This post will illustrate the use of MT4 to: Download free historical data Verify your strategy’s logic Backtest your strategy The complete trading strategy can be downloaded here. Before diving into strategy development, it pays to verify your algorithm’s…

With an abundance of technical indicators available, selecting your strategy’s entry conditions can be overwhelming. This post will illustrate a method to graphically compare the profitability of different entries. Entry selection is arguably the most important…

A big advantage of algorithmic trading is the ability to simultaneously trade a large number of strategies around the clock. But these strategies are only as reliable as the computer you trade them on. A forex VPS has become a permanent staple in my trading toolbox. I have a VPS with FXVM, with about 70 […]

This has to be among the top 5 questions I’ve received over the years. Continual improvement is the name of the game, but to improve, you first need an objective way to measure performance. So as a retail trader, is there a professional benchmark, against which…

Risk management is a cornerstone of successful trading. Most traders quantify risk by measuring the drawdowns incurred by their strategies or portfolios. Drawdown is the decline in account equity from a prior equity peak. For example, if your peak equity is $5000, and your current equity is $4000, you have a $1000 drawdown. As trading progresses, […]

The MACD is a simple and effective momentum indicator. Here’s how you can save screen time by programming a MACD divergence strategy for the GBPJPY! You can download the strategy below from the Free Strategies section. The Moving Average Convergence/Divergence… The Laguerre RSI attempts to improve the responsiveness of the regular RSI, whilst keeping whipsaw […]

Most retail traders are time-crunched in one way or another. While live algorithmic trading requires little screen time, the initial strategy development phase requires much time and effort. Multiple timeframe backtesting can be a great tool in your bid to efficiently churn out robust strategies. Why Backtest on Multiple Timeframes? 1. Verify Your Strategy’s Robustness […]

The QQE is a mysterious indicator that sometimes pops up in trading forums. Does it deserve a place alongside the more traditional momentum indicators like the RSI and CCI? Let’s add it to a trend following strategy to find out! The complete strategy can be… Bollinger Bands are great at detecting overbought and oversold conditions. […]

A trailing stop is a dynamic stop loss that moves in tandem with prices to protect your floating profits. If you’re in a long trade, the trailing stop moves upward as profits accrue. If prices move against you, however, the stop does not move. The chart below shows a 100-pip trailing stop applied to a […]

Traders are perpetually engaged in the search for better entry signals. With today’s backtesting software, we can quickly quantify an entry’s profitability over years of historical data. The Edge ratio, first proposed by Curtis Faith in Way of the Turtle, is a unique metric that can help with entry selection. The ratio is derived from […]

This has to be among the top 5 questions I’ve received over the years. Continual improvement is the name of the game, but to improve, you first need an objective way to measure performance. So as a retail trader, is there a professional benchmark, against which…

The forex markets are open 24 hours a day, but not all hours are created equal. Trading volumes are known to vary significantly throughout the day. But I’m not one to listen to anecdotes, so I decided to dissect my broker data and verify it for myself. It’s in the Data Here’s how you can […]

Many years ago, a stock broker told me, “When the US market sneezes, the world catches a cold.” That still rings true today. If you trade anything at all, chances are you’ll have to pay attention to the US economic reports, and few can trump the…

Bollinger Bands are the gift that just keep giving. They’re simple and easily applicable to both trend following and countertrend strategies. Here I’ll introduce yet another way to use Bollinger Bands to fade temporary overextensions. Bollinger Bands in a Nutshell Bollinger Bands consist of a simple moving average, with a pair of bands plotted at […]