YAKUZZA LIBRARY Strategy & Backtesting NAJM FX × YAKUZZA

Strategy & Backtesting.

Name: Strategy & Backtesting
Availability: InStock
Author: Najm FX

From idea to tested system: how to write unambiguous rules, and a real backtest on gold data with the full numbers — win rate, drawdown, costs and the overfitting trap.

12 chapters≈ 85 min readIntermediateFree

Start reading Contents

12 chapters — the first one is open to everyone, the rest need a free account

Chapter 01

Why You Need a Written, Tested Strategy

≈ 6 min read

Most traders enter on a "feeling": the candle looks strong, price "has dropped a lot", the channel said buy. Sometimes they win, sometimes they lose, and six months later none of them can answer a simple question: does my method actually make money, or was I just lucky?

Gut feeling isn't the enemy, but it can't be measured. Today you enter on a touch of the moving average, tomorrow you wait for a break, the day after you enter because you're bored. Every trade is built on a different rule, so there's no "strategy" to improve in the first place. What you have is a collection of random decisions with random results.

Gut feeling vs. a system

	Trading by feel	Written, tested strategy
Entry decision	Changes with your mood	The same condition every time
After 5 losses	"It stopped working" — changes it	Knows in advance the test showed streaks this long
Measuring performance	Almost impossible	Number of trades, win rate, expectancy in R
Improving	Guesswork	Change one rule and test it on new data

A written strategy turns trading from a mysterious art into an experiment you can repeat. And backtesting (testing on historical data) is the cheapest way to find out whether the experiment deserves your money: instead of losing three months of your real account to discover an idea doesn't work, you find out in a day, on past data.

What makes this book different: we won't stop at explanations. We ran a real, honest backtest on 400 real 4-hour gold candles (22 June to 22 September 2026) and 500 one-hour candles, for two simple, fully mechanical strategies. And we'll show you the results exactly as they came out — even when we didn't like them. No spoilers, but: the results aren't pretty, and that is precisely the most important lesson in the book.

What you'll learn in this book

The components of any strategy, and how to turn a vague idea into testable rules (Chapters 2 and 3).
Manual bar-by-bar backtesting, then a real backtest on gold with precise rules and complete results in numbers (Chapters 4–6).
Reading the results: expectancy, drawdown and losing streaks, with an interactive calculator (Chapter 7).
The overfitting trap and the effect of real costs, with numbers from our own test (Chapters 8 and 9).
The road from backtest to demo to live, when to adjust a strategy and when to drop it, and a quick reference (Chapters 10–12).

Note: every price in this book comes from real gold data (XAUUSD). We measure results in R = the amount risked on the trade, as explained in the Risk Management book. A 2R win means twice what you risked; a 1R loss means the stop was hit.

Next chapter: The components of a strategy →

Chapter 02