Indicator confluence, lag and false signals, backtesting and overfitting, ATR position sizing, exit rules and sample size.
For: learners who know the indicators and want to turn them into trading rules
This course uses ideas from the courses below (optional; you can start right away).
Any single indicator is often wrong. When trend, momentum and volume all point the same way, the signal tends to be more reliable, but rarer.
Every indicator based on past prices lags, and in a ranging market the signals will whipsaw you again and again.
Test your rules against historical data: return, win rate and maximum drawdown, and you can't skip any of them.
Tuning settings to the historical "best" often just memorizes noise. Out-of-sample testing is the real test.
Even the best signals lose sometimes. Deciding how much to lose per trade matters more than finding the perfect signal.
Same entry, different exits (fixed take-profit, trailing stop, time stop): how do win rate, payoff ratio and expectancy change?
With too few trades, win rate and returns are easily swayed by luck. Use a confidence interval to ask: roughly where is the true win rate?