Sep19+20 update

(Still in Germany…)

Worked all day on Friday.  Continued testing on AUDUSD through to the end of May 2014.  All in all took 75 trades in 5 months of the testing period, more or less broke even over those 75 trades (made 3.8R) – after incorporating the multiple timeframe adjustment and apparently only taking trades where the EMA’s are being respected and where the price action is smooth – am still worried that I might be adjusting my trading approach slightly here and there based on how previous trades have worked out.  On Saturday I did some further analysis on the completed trades – did the trades go in the anticipated direction? Did I get stopped out on small retracements? Did price go against me immediately?  Unfortunately I didn’t come up with any solid conclusions or insights from the analysis.

On the upside, this result is a lot better than the live trading results I achieved over the last three months.  So it’s a step in the right direction.  I will now go on and test some other pairs over a random period.

I am thinking that there’s no point me trying to trade the EMA strategy if I can’t produce decent profits in a testing environment.  Though it’s probably premature for me to make generalizations about the profitability of the EMA testing.

Testing prior to live trading:  As a general point, I think there is no valid argument for me trading any strategy unless I can show consistent profits in a testing environment first.  Again this is something that every aspiring trader should know.  It is a point I considered more than a year ago when I first began trading STAM – I did want to test STAM but I wasn’t sure how to go about it, so I didn’t – certainly somewhat careless!

Why bother risking real money trading in a live environment, unless you have a lot of confidence that the strategy is likely to produce a profit?  One argument is that unless one trades live, you are not going to learn some of the finer details of the market place that may impact you – e.g. scheduled and unscheduled news events, correlations between currencies and markets, strength/weakness, low volatility days etc

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