Strategy Validation Framework - Standardised ATR Exits & 1% Ris by backtestbay
By backtestbay
Performance Metrics
- Author: backtestbay
- Symbol: FX:XAUUSD
- Timeframe: 1 day
- Win Rate: 34.1%
- Profit Factor: 0.991
Description
A reusable backtesting template that applies consistent exit conditions toany entry signal, allowing fair comparison between strategies.HOW IT WORKSExits are driven entirely by ATR (Average True Range). Stop loss is placedat a configurable multiple of ATR from entry (default: 3x ATR-14). Takeprofit is set at a fixed multiple (default: 6x ATR, giving 2:1 R). Positionsize is calculated so that the maximum loss on any trade equals a fixedpercentage of current equity (default: 1%), normalising risk acrossinstruments and account sizes.WHY THIS EXISTSMost strategy comparisons produce misleading results because each scriptuses different stop distances, lot sizes, and commission assumptions. Whenexits are standardised, you isolate the entry signal's actual edge ratherthan comparing risk management decisions.HOW TO USE1. Paste your indicator logic below the INDICATOR comment line2. Set longCondition / shortCondition to your entry signals3. Open Strategy Tester — the framework handles exits, sizing, and costsThe placeholder entry (9/21 EMA cross) is an example only. Replace it.DEFAULT PROPERTIESATR Length: 14 | Stop Loss: 3x ATR | Take Profit: 6x ATR (2:1 R)Risk per trade: 1% | Commission: 0.01% per side | Slippage: 1 tickLIMITATIONSResults depend entirely on the entry logic substituted. The EMA crossplaceholder is for illustration only and does not represent a recommendedstrategy. Backtesting results do not guarantee future performance.