Our method

How we test, in 5 steps

Data

Crypto prices come from OKX perpetual futures (15-minute candles, 2022–2025). The 2020–2022 check uses Binance's public archive (median price gap to OKX: 0.06%). US index data comes from HistData. A final year of data is held back for single, pre-registered tests.

Costs

Every trade pays a 0.05% taker fee per side, 2–5 basis points of slippage per side, and funding every 8 hours at each market's measured average rate. Results are in R: 1 R is the amount risked on one trade (entry to stop), so strategies with different stops compare fairly.

Versions

A rule shared online is never fully specified (which stop? which holding time? which timeframe?). So we test every reasonable reading: each combination of the settings below is one version.

Two halves

The data is split in two halves (a rising market, then a flatter one). A real edge should work in both.

Against the market

A long trade in a rising market makes money without any skill. We subtract what simply holding the crypto market (an equal-weight basket) on the same side over the same days would have made: what remains is what the rule adds.

Older data, never seen

The best version is then run, unchanged, on 2020–2022 data that played no part in choosing it (a crash, a bull market and a bear market).

Why “the best version” misleads

When hundreds of versions are tried, some look excellent by luck alone. So we always report the typical version next to the best one, and we never trust the best version until it works on data that played no part in choosing it.

Verify it yourself

1. Get free data: Binance's public archive (data.binance.vision) has years of candles; OKX and most exchanges offer an API.
2. Include costs: fees on both sides, slippage, and funding for perpetual futures.
3. Count results in R (risk per trade), not in %, and look at the typical version, not the best one.
4. Split your data in two and keep a part you never look at until the end.
5. Compare with simply holding the market over the same days.

Limitations

• A backtest is not live trading: fills, outages and your own discipline differ.
• We test the rule as written; a trader's discretion is not testable.
• Markets change. A rule that failed here could work elsewhere, and the reverse.
• Costs depend on your exchange and size; ours are typical retail perpetual-futures costs.

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