Backtesting in Forex
A clear definition of Backtesting, with practical context for reading markets and making better trading decisions.
Definition
Testing a clearly defined strategy against historical data using rules that could have been known at the time. It estimates behaviour; it does not guarantee future performance.
Practical forex example
Review two years of EUR/USD examples using the same entry, stop, and exit rules.
Why Backtesting matters
Understanding Backtesting helps traders interpret market information, plan decisions, and manage risk with more context.
Related forex terms
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