How Do I Trade with System Signals
How to Read System Signals
Back Testing System Signals
Generating XAUUSD Signals with a xauusd system is one of methods to trade gold - it is one of the ways that a beginner trader can attempt to determine the direction of the trend with a good level of accuracy - and with a little xauusd practice and back testing on xauusd practice account so as to gradually increase the level of accuracy of this xauusd system through practice xauusd using the system.
The best technique of how to back-test a strategy is by following these two steps:
- XAUUSD Trading Paper Method
- Demo Trade Method
XAUUSD Trading Paper Trading - xauusd trading paper method of testing a xauusd system involves placing your xauusd system on a xauusd chart - then take the chart back to a particular date - for example 3 months back, and then using this chart price history to determine where your system would have generated buy signals, sell signals and exit signals. Write down these points on a xauusd journal and also write the profit per xauusd trade or loss per xauusd trade and then calculate the total profit of loss after you have recorded a good number of trades generated by the system such as 20 paper trades and determine if your xauusd system is overall profitable or not, the win ratio of xauusd system, the loss ratio of your xauusd system and the risk: reward ratio of your xauusd system.
This is an ancient technique of testing xauusd systems that was used by traditional traders when there was no online xauusd markets or desktop pc computers for that matter, the trader would use something like the A3 or A2 paper, graph format paper and draw the charts manually (Imagine drawing the charts on your xauusd platform by hand each day every hour, would you as a trader be ready to do that? - doubt it!) Those traders were hardworking than most, anyway for our paper method example, just a sample data of 20 gold trades is all we need.
A good xauusd tool to use to back-test your xauusd system is the MetaTrader 4 XAUUSD Step by Step Tool. Found in MT4 charts toolbar of MT4 software - If you want to find the charts toolbar on the MT4 platform it is at the top of MetaTrader 4 software. If the charts tool-bar is not there: Click View (next to file, tops left corner of MetaTrader 4 platform)>>> Tool Bar >>> Charts. Then click the Customize button >>> Choose XAUUSD Step by Step >>> Click on Insert >>> Close.
MT4 Platform Chart Tool-Bars
Analyze System XAUUSD Signals - How to Trade with System Signals
Once you get this MetaTrader 4 tool you can move your xauusd chart backwards, and use this MetaTrader 4 tool - xauusd step by step xauusd tool - to move the charts xauusd step-by-step while at the same time testing when your xauusd system would have generated either a buy signal or a sell signal, & where you'd have exited the trade, then write down on a xauusd journal the amount of profit/loss per xauusd trade and out of a sample number of trades you would then calculate the overall profits/losses generated by the system.
If your xauusd system is profitable on the paper trade method then, it's time to open a xauusd demo account - demo xauusd trade and test if your xauusd system is profitable on the real market as it's on the paper method. This is known as the process of testing a xauusd system or back testing a xauusd system.
Write a XAUUSD Journal to keep track of the profitable trades & use the journal to determine why these trades were profitable. Also keep a log of all losing trades and use the journal to determine why these trades made losses so as to avoid making these same mistakes the next time that you are trading using your xauusd system.
Tweak your xauusd system until your xauusd system gets a good risk: reward ratio - with the signals that you generate with it. Aim to get a good risk: reward ratio of 3:1 and a win ratio of above 70% for your xauusd system is a good ratio, with proper xauusd money management rules even a xauusd system with a win ratio of even 30% than is less than half of your trades make profit you can still make a profit using the proper xauusd money management guide-lines. You might want to learn the topic xauusd money management to know what the illustration below is all about: Risk : Reward Ratio.
Analyze System XAUUSD Signals - How to Trade with System Signals
Learn XAUUSD Equity Management Methods Tutorial
A manual xauusd system is still the best way to generate xauusd signals compared to automated xauusd systems, a manual xauusd system is a better method and is also much simpler to implement.
However, other xauusd traders prefer automated xauusd systems and for those traders - they can check the automated xauusd information on this learn xauusd webpage MQL5 Gold Automated EAs & Automated XAUUSD Systems.
You can also learn other xauusd strategies to use in your xauusd system from our list of xauusd strategies topics that provides you with various methods of how to generate buy signals & sell signals using various analysis methods - XAUUSD Strategies List.
Analyze System Gold Signals - How to Trade with System Signals
