Val was Struck by Lightening

Why back test your idea any way? EL has mentioned many times in his posts that you need to back test your or his setups before putting any money at risk. I asked myself the question above many times and did not find any credible answers for me. I am this kind of guy who does not listen right away and sometimes never. The first thing EL told us to do is, you guess, back test “our setups”. Since I paid money, I forced myself to do it. Why forcing? Programming is not my strength, therefore I would need to do it “by hand”, which requires plenty of time. So I went over 2 months of range bar charts with EL’s indicators on them looking for “my setup” and validating it for a profit or a loss.

After encountering about 10 trades a “lightening” bolt struck me. It can’t be! It is the Law of Large Numbers that makes the whole concept of “having a plan and trading it” work. If you studied maths at an elite university as I did, then discovering the Holy Grail during such a simple procedure makes you embarrassed. After 5 years of studying in-understandable stuff for most of people you should have seen this without back testing. I continued with my back testing and discovered all the nuances that made me feel confident that “this stuff works” with or without the Law of Large Numbers.

So, if you very often do not listen like me, please just do that: go over your charts and find 10 trades to validate your setup. I guarantee you, even if the lightening does not strike you, you will see the picture of your setup more clearly than before. And this is the first tiny step for all of us on our way to CP.

Hang in there,

Val