Backtesting System™ (OSC) allows user to set their own long/short entry rules from features of the Oscillator Matrix™ as well as external indicators.
Entry rules can be created separately for both long and short entries, and can be set using up to 8 different user set conditions. Each can enabled by toggling them on using the toggle input on the left of each condition, if the enabled conditions are valid, the strategy will open a corresponding market order.
Oscillator Matrix™ Conditions
Conditions for 6 features of the Oscillator Matrix™ are included. These include:
- Money Flow conditions
- OverFlow conditions
- HyperWave conditions
- Reversals conditions
- Divergences conditions
- Confluence conditions
The first dropdown determines the specific condition used for that feature, these can include generic conditional operators such as
Greater Than or
Crossing, or conditions proper to certain features such as
Any Bullish in the Hyperwave conditions.
The second input setting allows the user to enter a numerical values, which is used when
Crossing Under, or
Crossing are used.
For example if the user wants to go Long when the HyperWave oscillator cross over 80 the following settings would be used:
External 1 and External 2 conditions allow the user to use the output of external indicators on the chart as input.
External 1 allows setting a condition based on two different external indicators output, with The first and third dropdowns determining which external output to use.
The second dropdown determines which conditional operator to use on both external outputs. These include:
External 2 works similarly but instead of comparing two external outputs the condition will compare an external output specified in the condition first dropdown with a user set value in the third numerical setting using a conditional operator set on the second dropdown. This last condition is particularly useful for oscillators. Users can also use price placeholers such as open, high, low, close, hl2, ohlc4, hlc3, and hlcc4 instead of a numerical value.
Here is an example of External 2 being set for an RSI crossing over 50.
Using Conditions Together
More complex entry rules can be created by using multiple conditions together, this is done thanks to the Step dropdown setting on the right of each condition (below each condition for conditions 4 and 5).
The Step setting is directly related to the Step & Match algorithm and work in two ways:
- When two or more conditions have the same step number, both conditions are evaluated. Used to test matching conditions.
- When two or more conditions have different step numbers, each conditions will be evaluated in order, testing for the first step and switching to the next step once the previous one is true. When the final step is true the strategy will open a market order. Used to create sequence of conditions.
This operation is complementary, as you can create a sequence of conditions with one step consisting of two or more matching conditions as long as they have the same step number.
A user wanting to go long when a bullish divergence occurs after any bullish reversal while money flow was bullish (over 50) could do it as follows:
No Existing Positions Requirement
Users can enable the Don’t Allow Trades Until Closed setting in order to only open trade when no existing positions are open. This setting allows waiting for a position to be closed before one can be opened.
Enabling Don’t Allow Trades Until Closed for long positions will prevent opening shorts as long as a long position is opened.
If this same setting is not enabled for short conditions then shorts can effectively be closed by new long positions.