The Smart Forex Tester Suite usability is drastically improved starting from the release we published today (Build ID: 1805.2010.26).
Instead of multiple data feed control buttons scattered on different tabs, now we have the toolbar that is visible from every tab. Here’s how it looks:
smart Forex Tester usability improved
To make the user experience even better, we also added the Online and Offline buttons to select the data source.
To test on the live market data feed, press Online button. The currency pair selector becomes active. Select a pair.
To back test on historical data, press Online button. Click the File icon and select a tick data file. You can also try sample prices available on Data tab. Select the date and time when to start the test.
Now, the test data is ready.
If you want to practice manual trading, this is all you need – just press the green Play button and data feed will start. You can pause and stop the data feed from any tab.
If you want to test an automated strategy, go to the Strategy tab and prepare your trading automation code and then start the data from the Tester tab. In this case the feed will run at maximum speed and the test report will be shown.
The pivot points you can investigate on the Analyzer tab – former PPA (i.e. Pivot Points Analyzer). We renamed it for clarity.
Note that the actions described above depends on the license installed. Check the inbuilt help for details.
As we already mentioned, we changed the structure of our free Forex software products.
There were no changes in access rights, though. As long as you remain our subscriber, you can use any free license and switch between them as often as you want.
Below we explain the difference between the functionality included in each of the free software licenses.
Online Forex Simulator
online data feed for 10 main currency pairs
live price data saving locally
manual order placement
Offline Forex Simulator
tick data load from file
manual order placement
trading server delay
Forex Strategy Tester
online data feed for 10 main currency pairs
tick data load from file
live price data saving locally
trading server delay
offline Pivot Points Analyzer
Full C++ environment to develop and test trading automation
The new structure started from the release 1804.0723.35.
We often get questions about our Smart Forex Tester – how to use it?
First of all, Smart Forex Tester is a generic name. We have several different products, but they all are included into the same binary, which is called Smart Forex Tester.
You only need to install the software once, and then – for free products – you only need to switch between the licenses, which you can do from the same GUI.
Smart Forex Tester: Products
Basic (stand-alone) licenses are free – but you need to reinstall the licenses every time you want to switch between products.
The free licenses are valid as long as you stay our subscriber, and you can switch between them as many times as you want.
Paid bundles add a lot of value because you can use bundle components simultaneously in any combination. Obviously, you don’t need to switch licenses, either.
When you start the software, you will have your free license generated in no time. Just select the product and enter your subscription email.
Our subscribers are granted a free license for each of these 3 products.
Once you activate any free license, you can switch between all the above products as many times as you need. Moreover, your free licenses never expire.
You can get your free license directly from the software. This 30 s video shows how. (NOTE: remember to use your own email address you subscribed with!)
(if you haven’t done this yet, subscribe and download the software).
On start-up, you’ll be shown the main products menu, which looks like this:
Smart Forex Tester Suite Products
Click the Get free license link opposite the free product you want.
If you are unsure which product you need – no problem: just pick any and try! Like we said, you can always switch products later!
You’ll be taken to the next screen where you’ll need to enter your email address you used to subscribe with us and then click the Validate license button (click on the image to enlarge):
Smart Forex Tester Suite – license activation
The software will then activate your license. You may want to save your personal code (seen in the Code field) for later – in case you need to use the software offline.
Next, you need to restart the software to finalize license activation. That’s it – you are good to go!
Now, when you start the software, the link for the product you activated the license for, will change to Use and all the functional tabs will be visible.
When you want to switch between free products, you will need to repeat the procedure above. This time, you won’t even need to enter your email.
In addition to free products, Smart Forex Tester Suite offers 2 premium bundles. While free products offer ample functionality which is enough for developing and testing your manual or automated trading strategy, it is the bundles that bring you to completely new level.
Premium bundles not only provide convenience by eliminating the need to switch licenses. Most importantly, they add value because you can use all the bundled products simultaneously – and in any combination.
For example, you can run in the Tester an automated trading strategy that uses the signals from the Analyzer.
Or, you can test semi-automated strategies, where you enter the market manually, but let the automated trader monitor the profits and risks for you (“autopilot” mode). Or the other way around.
As you see, the Smart Forex Tester Suite can be used in lots of different ways.
Smart Forex Tester and Simulator are the first products that we have integrated on our new platform. Next products to be integrated are Pivot Points Analyzer and Data Recorder.
Previously, each one was a stand-alone product.
The main rationale behind integration is that all the products share many functional blocks, e.g. data engine or price graph. So integration will speed up our development process and will also help us improve quality.
To make each product available as a stand-alone software, we introduce licensing. Basic individual products will continue to be free for our subscribers, and you can have a free license for each one.
However product bundles will be premium paid products.
Smart Forex Tester, Simulator are integrated
What it means for you? If you are our subscriber, you will simply need to claim your personal free license for each product that you are interested in. We will email you your personal code and instructions.
Like we said, basic licenses are free – but you will need to reinstall the licenses every time you want to switch between products. Paid bundles will provide convenience by eliminating the need to switch licenses. They will also add value because you can use bundle components simultaneously in any combination.
So be sure to check your inbox for the email with your personal credentials and download instructions.
We receive questions from time to time on why our Forex testing tools only support one month of data. These questions obviously arise because Smart Forex Tester and Simulator GUI has a tab with one month calendar.
Forex testing on historical data
As a matter of fact, both Tester and Simulator can work with unlimited data.
A monthly calendar view was added to provide an easy way to select when to start the test (stopping the test can be obviously done any time).
But on this occasion, it would be good to discuss here whether we really need big data files in Forex testing.
The only argument in favor that we can imagine is the need to test strategies that use long time frames.
But if we really wanted to use such strategy, does it make sense? Do we have enough time for that? And even if we do, we need to have a lot of money invested to satisfy margin requirements. Unless you trade with large sums without any leverage.
And even more questionable are the benefits of testing on the long intervals for the most commonly used optimization methods, when a given set of strategy parameters are permutated to make the strategy work best on the historical data.
Unfortunately, it doesn’t guarantee the strategy will win when used the very next day – whatever long interval you tested it on. This is the reason we use a principally different approach.
We are developing the mechanism to adjust the strategies to the current market automatically on the fly. So, we test our automated trading strategies on 1 week long test data.
There are several reasons behind this testing interval selection. The primary one is continuity in the price quotes. If you leave a position open over weekend, you always risk hitting a price gap. If something happens during the weekend, the gap can easily be several hundred pips. And stops sometimes can not be even triggered.
Next, it takes reasonably short time to run a test on one week of quotes. is not too long to run.
Of course, big price moves can happen during the trading week, as well. However, it’s not a gap – but a very fast moving market. So you might be able to do something yourself and stops might work.
In addition, quite often such turbulence is news related and so can be predicted, as the major news releases are mostly scheduled.
Our approach is to use one week as a standard interval that is easy and quick to run and analyze. Based on the analysis, we select certain data intervals that are worth using later. Mainly, those where the strategies loses systematically.
Only these intervals are worth testing on. Markets quite often just treading water. Testing on such data is just wasting time.
So we prefer to collect a set of test cases that represent the market conditions that are difficult for the strategies to handle. Running the set is an efficient “smoke test” – if the strategy is failing, there is no need to go deeper and run longer tests.
Based on weekly test results, we can select most important parts of the data and us them later as test scenarios. They can be as short as one trading session. Often the market behavior is the same during one session, but the next session might not continue the pattern.
Best is to test overlapping new York and London sessions when the moves are most powerful.
You can use our free Forex Data Manager to slice a month long .csv data files into one week (or smaller) ones.
SmartForexTester.com is our new site that we started to host a free version of our new Smart Forex Tester product.
We already released paid version in the end of 2016. It is built on the new framework – the same we used to develop our Forex Simulator.
The new free Tester version will replace the currently available 0.9.5 software which was developed on the old framework and will be phased out.
Smart Forex Tester free version is released
As the old Tester, the new free version also uses tick-by-tick data only and can test on both historical price quotes and using inbuilt live market data feed.
Considerable improvement is added C++ support – as a means of trading strategy definition.
Also, you can use C++ environment to test EA if you have a source code. After some modifications, MQ code can be compiled in the Tester, and the interfaces are provided similar to MT to support trading operations.
You should have your Forex trading strategy description – even if you trade manually. And if you do auto trading, it is a must.
It is safe to say that the majority of amateur traders use Expert Advisors (EA) for automated trading. Why? Because it is a convenient way to interface the market via Metatrader trading terminal. And it is free.
What is EA exactly? It is essentially just a computer program, written in a proprietary language that is very similar to very popular C++, which is not the easiest thing to learn.
However, not all of us are computer programmers. And not all of us even want to master programming in a quite complicated language – just to be able to do the Forex trading strategy description ourselves.
Let’s also look at it this way. A lot of coding skills is needed essentially to program 2 relatively simple things.
decide when to enter the market
decide when to exit the market
You might say that we may also need to decide how much to buy / sell. We can argue that, at least in trading strategy testing, this is already a secondary priority. Any risk management won’t compensate for wrong entry or exit decisions.
Using this simple approach, we can understand that the best Forex trading strategy description should not need to be programmed each and every time.
Instead, we can just use a simple logical blocks to be able to define our strategy . The idea is that an average person – who is just able to think logically, but not having any programming skills – can understand it easily.
That said, of course, we need to develop the blocks themselves. But it’s one-off effort and you don’t have to do it yourself.
It’s like Lego – you don’t have to create the blocks yourself – just use them.
This is the approach that we used in our Smart Strategy Tester from the very beginning. The 0.9.x series used state machines for trading strategy description.
The all-new Tester 1.0 will bring it to the new level. It provides C++ environment, that we can use to program a trading strategy. But in the next releases it will also provide the way to program and use the blocks discussed above.
The benefits of automation are obvious – you are not chained to your computer and it gives you much less stress. To say nothing of the fact that a computer reacts to opportunities and executes trades way faster and better than you.
The downside of trading automation is also obvious. It is not that easy to develop an algorithm that fully replaces you in all sitiuations.
A question: why can’t we take the best of both worlds?
We tried it with our latest Smart Forex Tester 1.0 software. It has an option to manually override when an automated trading strategy is being run.
Trading automation was represented by a simple strategy that uses 3 RSI of different time frames to enter or exit the market, This strategy obviously only works well when the market is not trending.
For the calm markets, a typical situation where manual control was needed was around the peaks. There was usually a great deal of see-sawing there. And it was not clear whether a peak will hold.
Even such simple algorithm as we used could enter the market well. But fixing the profit was more efficient and easier manually. You could take less risk and if it was not sure the market goes where expected, you usually had a chance to close the trade with a small profit during the see-sawing. Or even small loss was a better option in an uncertain case than relying on a fixed automated stop-loss.
However, the main benefit of the manual control was during the beginning of the trends. Our simple 3 RSI algorithm works very badly on trending market. It will persistently try to enter the market in the direction opposite to the trend and will be stopped out a lot of times.
But even with such a simple system, you can still be successful. Once you notice a trend starting, you can disable the automated strategy and manually take a position in the direction of the trend and just hold it. When the trend is exhausted, you can return the control to the trading atomation.
Indicators seem to predict the Forex market at times. However, it’s difficult to turn this into profit.
A typical example of that is overbought conditions in oscillators. So, if the RSI is already very high (over 80), this condition points to reversal. But the problem is in timing. If you followed markets for some time, you know that such powerful trend can go on and on.
Siimilar situation is with Elliot waves. Even though we might have a very clear impulse wave pattern, the moment of reversal is hard to pinpoint. It is known that 5th waves can quite often be extended.
So basing the trading on indicators is difficult. In addition, the indicators are widely known, so a lot of traders might wait for the same event. And it is known that when market is commonly expected to go in some direction, it quite often behaves completely differently.
The only sure thing we can predict in the Forex market is that there will be ups and downs. Regardless of the market direction. Ups must be followed by downs and so on. This comes from the nature of the market – price discovery process.
The shorter is the timeframe, the better your timing can be. But if you try timing on e.g. M30 graph, you might lose hundreds of pips before the reversal occurs.
On the other hand, using the tick graph, even if you can time the reversal, you can’t tell the big picture. The pivot point can just be a local extreme.
In our opinion, the only way to tackle this is to react very quickly by generating pivot points signals on the tick graph and then use them to predict the action on longer timeframes.
You will never predict all market movements but you might be lucky more often than unlucky. You just need to be faster than others.
Many try to act only when market starts moving in a certain direction. This is already late. Here automated algorithms are the only way to go.
Trading manually, you can’t react as fast and – most importantly – equally error free for long time. To say nothing of the natural needs to do breaks.
We are developing the price actions algorithms that can be used for trading automation. We based them on our own pivot points detection algorithm. The figure below show the sample results of the detection in real-time.
Predict the Forex market? Pivot Points
You can try it with our Pivot Points Analyzer software (free download).
