The Importance of Backtesting

In trading, an idea without data is just an opinion. Astrological backtesting consists of testing a specific planetary configuration on historical price data to calculate its probability of success.

Defining the Strategy

Example: “Buy Bitcoin when Mercury enters Sagittarius and sell when it enters Capricorn.” To test this hypothesis, we must analyze every historical occurrence of this transit over the last 10 years.

Key Metrics

• Win Rate: Percentage of trades closed in profit.
• Profit Factor: Ratio between total profits and total losses.
• Max Drawdown: What was the maximum loss suffered during the strategy?

Useful Tools

Today, software exists that integrates ephemerides with TradingView data, making backtesting much faster than in the past when everything had to be done manually.

Conclusion

Backtesting transforms astrology from a “divinatory art” into a “statistical tool,” giving the trader the confidence needed to execute signals.