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Testing a Forex Trading System Before Risking Money

Testing a Forex trading system is essential to every Forex trader. Typically, one thing we are sure that our system is doing good if it has good feedback from other traders, you earn more than losing and the behavior of the system is constant to whatever methods you would use. Basically, most traders simply open a demo account and test their system in that manner. However, the disadvantage of that method is the time it takes to test the whole trading experience. I this article, We would suggest a not so common method called backtesting. The reason for backtesting is because you can gain the equivalent of 5 years of trading experience in one weekend by testing on historical data. Opening a demo account, it would take 5 years to get that same experience. Either is fine depending on your goals.

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Find out yet another tactic that differentiates the successful traders from those who lose. Backtesting is one of the underrated method but seems to be the most effective style of testing a trading system. The video clearly explained and showed us a concrete example of how backtesting works and how it is easy to use.

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