What is Backtesting in MetaTrader?

Backtesting is a crucial process for evaluating a trading strategy using historical data before applying it to a live account. MetaTrader provides robust backtesting features, available on both MetaTrader 4 (MT4) and MetaTrader 5 (MT5). This allows traders to simulate and analyze their strategies visually on past charts, helping them understand the performance and reliability of their systems.

Steps for Visual Backtesting:

1. Open the Backtest Window: Launch MetaTrader and press Control + R to access the backtesting panel.
2. Select Type: Choose whether to backtest an Indicator or an Expert Advisor (EA).
3. Choose Name: Select the specific indicator or EA you want to test.
4. Select Symbol: Pick a trading symbol from the dropdown list.
5. Select Mode:
   • Every Tick: Most accurate but slowest; requires tick data.
   • Control Points: Uses nearest timeframe data; preferred by some traders.
   • Open Price Only: Fastest, uses open prices of each bar.
6. Use Date: Enable custom date range for backtesting or use all available historical data by default.
7. Period: Select the timeframe for the test.
8. Spread: Choose a default spread value or customize it to match current market conditions.
9. Expert/Indicator Properties: Adjust input parameters based on your needs.
10. Symbol Properties: View properties of the selected symbol.
11. Open Chart: Display a chart with the selected date range.
12. Modify Expert: Edit the code of the EA or indicator (for developers).
13. Start: Begin the backtesting process.
14. Optimization: Optimize the EA by testing various input parameters to find the most profitable setup.
15. Visual Display: Enable to see a live visual representation of the backtest.
16. Skip to: Jump to the end date during visual backtesting.

Read Next

Loading...

Optimization

Optimize indicator performance.

Metatrader Linux Ubuntu Forex Trading

Run Metatrader on Linux OS

Mobile Alert with Metatrader Desktop

Setting up mobile alert for trades.