Forex Trading Strategy - Three Steps of Development

The three steps of development are:-

1. Emotions
2. Complexity
3. Testing

Emotions and intuition cannot be calculated mathematically. Mathematics is the only thing a trading system has to work with. So the first and most fundamental principal of trading system development is that every rule to enter or exit the market must be mathematically justified.

Trading systems grow into more and more complex ones by including rules that take into account more and more parameters. I believe that excessive amount of rules can ruin the successful trading system.

Testing is the absolutely necessary step. You need to have historical price data to test your system.