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Again and for the last time Pocoyo2014, do you want to make money or do you want to understand why the market moved this way and not that way? :confused: You truly believe that I give a rat's ass why the Yen, Google, coffee futures or the Nikkei moved that way rather than that way, today...

Good evening QuantWizard. Please note that I did NOT say that moving average cross-over systems are useless in general, far from it. All I am saying is that a trader should never take ANY trading idea for granted, no matter how "brilliant" it may sound. Test it first with 15 or 20 years of...

Maverick74, you really made my day, that was hilarious and true at the same time!

Here are the backtest results of a simple moving average crossover system. It has been tested with 11 years of historical data on Apple (AAPL). Amateurs who started trading Apple with this system from 1998 to 2000 would have naively concluded that this is indeed a fantastic system ("hey, see...

True. But mostly from years of chart studying and testing.

Did you know that trading systems with simple, clearly defined rules not only outperform systems with complex and numerous rules but are also more robust?

That's the problem with discretionary systems, they are extremely hard or even impossible to backtest! Not only that but the risk of curve-fitting them is high. Why would anybody want to trade these almost-impossible-to-test types of systems instead of sticking with simple but powerful...

Ok, got you. But then, how do you know that your system WILL make you money, in the long run? What makes you believe that your trading strategy HAS indeed a real predictive power, if you don't test it first with enough historical (or live) data, assuming the trading rules of your system are...

What variables, Bob? Still not sure what you mean by variables. Anyway, avoid illiquid markets and you will be fine, that's all I am saying. Quite frankly I don't give a rat's ass about HFT, my FX systems are still profitable and absolutely nothing has changed. Zero, nada. Backtesting I do...

What do you mean by "all signals are signals", Redneck?

Here is a trading idea : BUY the S&P 500 futures if Tuesday's open is higher than Monday's high. Stop is Monday's low. Liquidate the position on Friday at 1PM (EST). Now, would you immediately trade this system with real cash? Or would say something like this: "Hey, wait a minute, let's see...

Yes. Forex is by far the most liquid market on earth, period. Plus it gives me plenty of daily action, sometimes more than I can chew. And forget about poor fills and slippage, they are virtually nonexistent.

Excuse me?? :confused: What mood?? What general mechanics?? Markets go up, down and sideways, that's it. That's all they have been doing for centuries. Give your backtest sofware 20 years of historical data and it will immediately tell you if your trading idea is profitable or if you are...

Entire books have been devoted to that subject (backtesting). And a serious backtest always takes into account commissions and slippage due to poor fills. But seriously guys, why do you keep scalping thinly traded markets with low liquidity/volume and then complain about poor fills? Stick to...

That's the other way around, a backtest simply reveals if your trading idea has a statistical edge, period. For example you believe that buying a stock when the RSI is under 30 ("oversold") or shorting a stock when the RSI is above 70 will make you money in the long run, so you backtest this...

A backtest reveals that system A has been returning 10% a year on average for the last 100 years, while system B lost 10% a year on average for the last 100 years. So you want us to believe that you would have no problem trading system B because the 100 year long backtest says nothing about the...

I will rephrase your second question. 2) Risking your hard-earned money on untested, unproven day-trading systems: pure insanity or a brilliant idea? By the way, how is testing a trading idea with historical data harmful in any way, like the title suggests? :confused:

So let me get this straight, the Russell 2000 and crude oil have both DOUBLED in price since you started trading them and you couldn't (or cannot) make money because of these... "no-good" high frequency traders? You must be joking, right? I mean this is serious Seinfield material, Austinp...

Debunking myths about high-frequency trading: http://www.smh.com.au/business/debunking-myths-about-highfrequency-trading-20121001-26uwo.html 5 Myths About High-Frequency Trading http://www.huffingtonpost.com/bob-swarup/high-frequency-trading-myths_b_5133949.html

I am also wondering the same thing, as this HFT thing has had exactly zero impact on the profitability of my trading activities.