Trailing Stop Backtest For Algorithmic Trading in Python

This video tests the Stop Loss VS Trailing Stop methods for Algorithmic Trading using python. Backtests are applied to one trading strategy showing the differences between these methods.
#tradingbots #pythoncoding #algorithmictrading #tradingstrategy
🍓 If you want to follow structured courses with more details and practice exercises check my "About" page for Discount Coupons on my Udemy courses covering: Python basics, Object Oriented Programming and Data Analysis with NumPy and Pandas, ... more courses are on the way drop me a message if you have a particular interesting topic! Good luck!
and the link for the code:
drive.google.com/file/d/1Lpgj...
00:00 Trading Stop Loss Introduction
02:47 Stop Loss And Trail Stop Python Code
07:28 Backtesting Strategy In Python
10:00 Backtesting Results Analysis

[@LIL_MISSA]

Keep up the good work man, i love your codes and explanations ❤

[@CodeTradingCafe]

Glad you like them! Thank you for your support, much appreciated!

[@cryptolicious3738]

great video ! i really enjoyed this study of tsl tp strategies!

[@CodeTradingCafe]

Thank you, are you interested in coding as well?

[@gdydbjsiuxvsnsjdx]

Excellent content.. was looking for exactly this.. however, one variation that I am looking for is to break-even stops. For example, after the price reaches 1R, the SL could be moved to the entry point (or break even point) and then the SL starts trailing from there forward.
Thanks anyway for the video.. keep this coming!

[@CodeTradingCafe]

Hi thank you for your comment, actually yes I see what you mean, there are different variations of trade management, it's worth backtesting some of them.
Good luck, see you around I guess

[@a.winath4024]

Thank you so much friend!

[@CodeTradingCafe]

Thank you for your appreciation

[@mcdawgzy]

Awesome video, thanks so much for sharing

[@CodeTradingCafe]

Thanks for watching!

[@sergiopadronarellano5437]

Thanks a lot for sharing knowledge, code and video, very very usefull all your videos

[@CodeTradingCafe]

Thank you for your support, it makes a difference

[@sibiljas3628]

You are best . I wanted continue ❤❤❤

[@CodeTradingCafe]

Thanks a lot for your support 😊

[@1cBoris]

Hi, sorry for my english. Thanks for your videos, they are amazing. If we get the current price from the order book, for analysis and real trading, the stop loss will work much earlier than at the end of the candle. The candle looks like one beautiful movement, and there is a lot of volatility hidden inside.

[@CodeTradingCafe]

You are right, one way of avoiding this is to put SL outside the candle range, but you have to test the system again to make sure the odds are on your side.
Thank you for sharing your ideas, good luck!

[@rafalsza]

Great video. Did you tried vectorb for backtesting instead?

[@CodeTradingCafe]

I did have a look at it, to be honest I wasn't happy with their documentation, it was too time consuming to guess their functions so I simply moved to backtesting py

[@walduss7939]

Thanks to share.

[@CodeTradingCafe]

Thank you for your support 😊

[@johnmorales7531]

I just intalled Python to learn and be able to practice all this nice algoritms. Thanks for help people to learn.

[@CodeTradingCafe]

Good luck, remember learn slow but regular work don't get discouraged if it takes time

[@aidakhalil1394]

Bravooo👌

[@CodeTradingCafe]

:) thank you

[@yanchobeats]

Can you please clarify what these atr_f and ratio_f stand for and what 0.2 and 1 mean at 11:30. When I try this params on my algo (I am testing it on 1min timeframe) I get instantly taken out of the position. Thank you for the awesome work!

[@CodeTradingCafe]

The first is a ratio variable to define SL from ATR so SL distance is atrf * ATR, and the second is the TP SL ratio. Hope this helps, good luck!

[@sylas9762]

Hi is there anyway to backtest trailing and stop loss using pct( percentage of profit/loss), rather than ATR? and is there indicator or mathematic way to identify low volatility of the market and sideway market? Thank you in advance.

[@CodeTradingCafe]

Hi definitely you can use percentage distance instead of ATR, it's relatively simple. Regarding identifying low volatility you can use ATR it's a good volatility indicator or check this video th-cam.com/video/phy57DZOIwc/w-d-xo.html you can detect narrow channels for low volatility. I hope this helps!

[@paulbrown5839]

I like the idea of using ATR to adjust the stoploss at the end of every bar ... but instead of using ATR you should try a realtime volatility pulled in from somewhere else, maybe options market. ATR is too slow. Thoughts?

[@CodeTradingCafe]

I guess something like a custom function checking the ATR and the lowest/highest points of few previous candles then providing something around these values would be an improvement. But if trying to get the info from elsewhere the algo can as well keep an eye on the different correlated currencies...

[@paulbrown5839]

@@CodeTradingCafe ATR is telling you what the volatility was, not what it is. $EVZ might be better, and that is based on 1 month currency options.

[@CodeTradingCafe]

Will check it out hopefully it's reliable

[@jeffb9967]

hello and thank you for your great videos. Could you please tell me if these stop loss's work with crypto trading, in particular, ccxt and kucoin exchange, and will it work with any exchange?

[@CodeTradingCafe]

Hi, thank you for your support, in principle yes any technical chart is the same, so the same SL TP principles can be applied.

[@FootfunI]

Thank you for your very interesting and exciting video. I have question, if it writes that file is not found and the problem have to be in the second cell, where is code: df = pd.read_csv("EURUSD_Candlestick_1_D_ASK_05.05.2003-30.06.2021.csv"), what i have to do with it?

[@CodeTradingCafe]

Hi you can put the file in the same folder as the python file to.be found. Or try including the path in the code l.

[@FootfunI]

@@CodeTradingCafe Will I pissed you off if I ask you for code you are writing about? I am really lost.

[@CodeTradingCafe]

@@FootfunI no worries, just copy your error message here I will try to help. If it's unfound file try rechecking the name of the file and the path.

[@FootfunI]

@@CodeTradingCafe
FileNotFoundError
Input In [2], in ()
1 import pandas as pd
----> 2 df = pd.read_csv("EURUSD_Candlestick_4_Hour_ASK_05.05.2003-16.10.2021.csv")
3 df.columns=['time', 'open', 'high', 'low', 'close', 'volume']
4 #Check if NA values are in data
File ~\anaconda3\lib\site-packages\pandas\util\_decorators.py:311, in deprecate_nonkeyword_arguments..decorate..wrapper(*args, **kwargs)
305 if len(args) > num_allow_args:
306 warnings.warn(
307 msg.format(arguments=arguments),
308 FutureWarning,
309 stacklevel=stacklevel,
310 )
--> 311 return func(*args, **kwargs)

[@CodeTradingCafe]

@@FootfunI yes it can't find the file you can put both python code file and data file in the same folder or include the path from the read_csv function

[@yuvalbra]

thanks, great video knowlage, can you share the code

[@CodeTradingCafe]

done it's in the description, enjoy coding

[@kodzuvu]

How to run auto trade on any Brocker?

[@CodeTradingCafe]

Hi, it doesn't work for any broker because each broker has its own API, so the best way is first choose the broker and then learn their API... Now this wad the easy part... Now comes finding a winning strategy to automate :) this is a lifetime teaser

[@paulbrown5839]

hey man , why dont you show your sharpe ratio?

[@CodeTradingCafe]

Never thought about it to be honest, but also I am afraid not everyone is familiar with it so it's worth a video on its own...

[@paulbrown5839]

@@CodeTradingCafe Anybody watching these videos knows what it is, i think.

[@paulbrown5839]

@@CodeTradingCafe It would be good to show Sharpe in your videos. It's the only way we can compare your strategy to others because you don't show your vol either.

[@Dr.jayfrancis]

Some day, I'll understand these advanced algos.. but not now xD

[@CodeTradingCafe]

Keep up the good work it will take some time