SFX Backtester: Strategy Examples

The SFX Backtester allows users to create, backtest, and automate strategies using features from the SFX Algo Toolkit. This article provides detailed examples of long and short trade conditions to illustrate how to effectively use the SFX Backtester tool.

Long Strategy Example

Long Strategy Criteria

In this example, we will create conditions for a long strategy with the SFX Backtester that meets the following criteria:

• Step 1: A Bullish Signal from the 1-hour timeframe

• Step 2: A Bullish Signal from the current chart's timeframe

• Step 3: A retest of a bullish Retracement Wave

• Only take trades between 9:30 AM - 4:00 PM

• Take Profit (TP) 1 (80% of the initial total position) when price retests the Upper Volatility Band

• TP 2 (20% of the initial total position) when a Bearish Signal is detected

• Stop Loss (SL) when price retraces to the Lower Volatility Band

• Move SL to Breakeven (BE) when TP 1 is reached

Long Conditions

Step One:

The first step to set up this strategy would be inputting your conditions under the Long Condition settings.

First, set a detection for a Bullish Signal from the 1-hour timeframe as Step 1.

Step Two:

The second step requires setting a detection for a Bullish Signal from the current chart's timeframe as Step 2.

Step Three:

The third step requires setting a bullish Retracement Wave retest condition from the current chart's timeframe as Step 3.

Step Four:

The fourth step involves defining the time session criteria for trade entries. To do this, enable the Only Take Trades option and specify the desired time range, which in this case is from 9:30 AM to 4:00 PM.

Long Exit Conditions

To set up the TP and SL conditions for this strategy, scroll down to the Long Exit Conditions section within the SFX Backtester settings.

Step One:

Enable TP Condition 1 and set the criteria to be "Bearish V. Bands Retest" from the chart's timeframe for 80% of the total initial position. This will sell 80% of the position once price retests the upper or bearish volatility bands.

Step Two:

Enable TP Condition 2 and set the criteria to be "Bearish Signal" for 20% of the total initial position. This will exit the remaining 20% of your total initial position once a bearish signal is detected.

Step Three:

Enable the SL Condition and set the criteria to be "Bearish V. Bands Retracement". This will trigger the stop loss and exit your entire position if price retraces to the lower or bearish volatility bands.

Step Four:

Enable the Move SL to BE After Profit condition and set the condition to be "Long TP 1". This will move the strategy's SL to BE after TP Condition 1 is triggered.

Short Strategy Example

Short Strategy Criteria

In this example, we will create conditions for a short strategy for the SFX Backtester that meet the following criteria:

• Step 1: A Bearish Signal detection from the current chart's timeframe

• Step 2: A retest of the upper or bearish Volatility Bands

• Don't take trades between 2:00 AM - 6:00 AM

• TP when price moves 3 multiples of the Average True Range (ATR) in the intended direction

• Trailing SL of 100 ticks once price is 50 ticks in profit

• Hard SL of 1.5 multiple of the ATR

Short Conditions

Step One:

The first step to set up this strategy would be to input your conditions under the Short Condition settings.

First, set a Bearish Signal detection as Step 1.

Step Two:

The second step requires a retest of the upper or bearish volatility bands. To do this, set the criteria of "Bearish V. Bands Retest" as Step 2.

Step Three:

The third step involves defining the time session criteria for when the SFX Backtester short strategy can not open trades. To do this, enable the Don't Take Trades option and specify the desired time range, which in this case is from 2:00 AM to 6:00 AM.

Short Exit Conditions

To set up the TP and SL conditions for this strategy, scroll down to the Short Exit Conditions section within the settings.

Step One:

Enable the Fixed TP and set the condition to ATR with an input value of 3.

Step Two:

Enable the Fixed SL and set the condition to Trailing with an input value of 100.

Also, change the Trailing Stop Activation input to 50. This will activate the Trailing SL once price is 50 ticks in profit.

Step Three:

Enable the Hard SL and set the condition to ATR with an input value of 1.5.