We have previously mentioned that any traders worth their salt know for a fact that the market moves in a randomised pattern. For that reason, you will need to prepare another bot that captures the new market movement. You should also rethink your crypto trading strategy to fit the current situation.
By backtesting, you are able to see how well a strategy performs ex-post which is Latin for “after the fact” before employing it with confidence. Companies would use ex-post information to forecast future earnings.
Backtesting allows you to simulate a crypto trading strategy by taking historical data into account, and then generating results to be analyzed for possible risk and profitability.
Please keep in mind that the backtest settings on CryptoHero do NOT affect the bot’s performance in any way once the bot has already been deployed.
The backtest feature is accessible on the same place where you create a new crypto trading bot, regardless if you’re using the Web or Mobile app.
Longer time frame is better at reducing market noises, whereas shorter time frames is better at evaluating current prevailing trends. It’s recommended that you draw conclusions from backtesting several time frames for each crypto trading bot.
CryptoHero has an ultra-fast backtest engine that will allow you to test out the bot’s performance fast. When paper trading, CryptoHero derives data from the highly popular Binance exchange. Otherwise, candlestick data will be pulled from the exchange that your selected wallet is linked to.
Keep in mind that some cryptocurrencies that are newly listed on some exchanges may not have enough historical data. Also, please be reminded that CryptoHero will not be able to access data from other unsupported exchanges.
By using a crypto trading bot like CryptoHero, a trader can implement backtesting that will enable you to see how well a strategy performs.