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How to Create and Backtest Trading Strategies in Thinkorswim

 

 

http://thinkorswim.net — More of Josiah’s TOS trading resources New thinkorswim tutorial on how to program your own stock, futures, or forex trading strategy and then backtest it using thinkorswim. The thinkorswim platform by TD Ameritrade provides some great scripting capabilities for indicators, custom quote columns, scans, and even full forex trading strategies. In this video, Josiah creates a simple think or swim strategy that can be applied to forex, futures, or stocks, and shows you step-by-step how to start from scratch and implement your own algorithmic trading strategy in thinkorswim. This thinkorswim tutorial is applicable to forex trading strategies as well as stocks, ETFs, and futures trading systems. In this tutorial video, Josiah starts with a blank slate and adds inputs, variables, explains buy conditions, how to reference studies and indicators, and how to setup and use orders in TOS. To find out more about how to maximize your ThinkOrSwim platform, check out my website at http://thinkorswim.net

 

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How to Program Custom Trading Strategies in ThinkOrSwim

how to backtest Custom Trading Strategies in thinkorswim

How to Program Custom Trading Strategies in ThinkOrSwim

I’ve had several questions about ThinkOrSwim strategies, so I wanted to do a post on how to program custom trading strategies in ThinkOrSwim. Since I’ve been programming a lot of strategies lately myself, yesterday I decided to do a video for the official ThinkOrSwim.net YouTube channel where I go through the process of creating and testing a new, built-from-scratch strategy in ThinkOrSwim. It shows where to go to create and edit strategies, how to add and reference indicators, how to add user-customizable inputs, and then how to implement the strategy and backtest it on a specific chart.

It’s really important to quantify and monitor your trading edge, whether you’re trading discretionary setups or mechanical systems. ThinkOrSwim allows you to test strategies in mechanical form, which can later be applied to either discretionary or automated trading systems. You can take the edges you identify quantitatively with ThinkOrSwim, and apply them to a discretionary trading strategy that takes advantage of even more precise entries and exits than what an automated system might provide. And I think, one way or another, whether edges are manually identified over time through trial and error and detailed journaling, or automatically identified with systemized backtesting, quantitative edges are an essential part of all types of trading.

So with that in mind, here’s my most recent video on how to program custom trading strategies in ThinkOrSwim and run backtests on them:

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New ThinkOrSwim Trading Strategies Published

thinkorswim trading strategies

New ThinkOrSwim Trading Strategies Published

I’ve recently posted several strategy scripts to the website that identify quantifiable edges for my fellow traders. These ThinkOrSwim trading strategies can be traded standalone, or tweaked further and customized to fit an individual’s trading style. They can either be used to setup automated trading systems in other platforms, or traded manually within ThinkOrSwim and improved with price action trading principles. My most recent strategies are all listed under the strategies category on the site, and here’s a quick reference list:

Most of these strategies come straight out of Larry Connors and Cesar Alvarez’s book “Short Term Trading Strategies that Work,” and are specifically for trading the SPY, SPX, or ES futures. But these ThinkOrSwim trading strategies may also provide edges on other instruments, and you can test them on whatever symbols you like to trade, to see if they can be applied profitably there as well.

I hope these strategies are as intriguing to you as they were to me, and hopefully they will provide you a more quantifiable way to determine your edge in the market as well.