What's the difference between Every tick and 1 minute OHLC modelling in strategy tester?

 

What's the difference between Every tick and 1 minute OHLC modelling in strategy tester? Why is it that all strategies that look profitable using 1 minute OHLC modelling went badly if I were to change it to every tick modelling? All of the strategies are in higher time frame, such as 15 min, 1 hr etc.

Where can I read more info on this matter?

Thank you!

 

The 1 minute OHLC modelling quality uses only the open, high, low and close of any given bar in the timeframe you will use to perform the backtest trade calculations.

The every tick modelling quality uses every tick between all these levels that the price has passed from, so its more precise in order to calculate better the profit/loss results of the trades.

For more solid and trustworthy results, always use the 'Every tick' or even better the 'Every tick based on real ticks' modelling quality.

You can read more about this here: https://www.mql5.com/en/articles/239
 

Nothing to add to what @Eleni Anna Branou already well explained.

I can only write a note about the fact "Why all strategies look profitable in 1 minute OHLC and not every tick". This means that EAs you are referring to are affected by each single tick, for one or more of followign reasons:

  • Ask/Bid prices used in some functions (like trailing stop)
  • Indicator checked on shift 0 (current candle not yet completed)

By logic, you can easily understand that if you want to build a more solid system you should build something that is not affected by tick and to check your indicators always on shift 1 or greater.

Doing that, you can totally trust 1 minute OHLC mode and you will save precious time when backtesting/optimizing and you will also be sure that your system is more solid among different brokers that have (of course) different ticks. 

 
Fabio Cavalloni #:

Nothing to add to what @Eleni Anna Branou already well explained.

I can only write a note about the fact "Why all strategies look profitable in 1 minute OHLC and not every tick". This means that EAs you are referring to are affected by each single tick, for one or more of followign reasons:

  • Ask/Bid prices used in some functions (like trailing stop)
  • Indicator checked on shift 0 (current candle not yet completed)

By logic, you can easily understand that if you want to build a more solid system you should build something that is not affected by tick and to check your indicators always on shift 1 or greater.

Doing that, you can totally trust 1 minute OHLC mode and you will save precious time when backtesting/optimizing and you will also be sure that your system is more solid among different brokers that have (of course) different ticks. 

Hi Fabio!
Thank you for this insight. 
But does one need to use 1 minute as the trading timeframe as well in the EA code?
 
Chika Echezona Anumba #:
Hi Fabio!
Thank you for this insight. 
But does one need to use 1 minute as the trading timeframe as well in the EA code?

You can use any timeframe you want, the only important thing is to check indicators/prices at least on the last closed candle backward. And don't use Ask/Bid in any function. Also working with market orders instead of pending, because pendings triggering may be largely affected by ticks...

 
Fabio Cavalloni #:

You can use any timeframe you want, the only important thing is to check indicators/prices at least on the last closed candle backward. And don't use Ask/Bid in any function. Also working with market orders instead of pending, because pendings triggering may be largely affected by ticks...

Yes, I appreciate your contributions my dear. 
What I've been considering is the idea of not using Ask/Bid in any function. 

What then do you suggest as an alternative for the market price to use?
For instance in a relationship between the indicator and price; what do you suggest for a current market price to use, since you advised not use even the current bar close? 
 
Chika Echezona Anumba #:
Yes, I appreciate your contributions my dear. 
What I've been considering is the idea of not using Ask/Bid in any function. 

What then do you suggest as an alternative for the market price to use?
For instance in a relationship between the indicator and price; what do you suggest for a current market price to use, since you advised not use even the current bar close? 

For reliable indicator information I would suggest either the Open price of the current bar, or the Close price of the bar before the current

 
Conor Mcnamara #:

For reliable indicator information I would suggest either the Open price of the current bar, or the Close price of the bar before the current

That's interesting! 

THE use of the 'Opening price' of the current bar is what I've not actually considered yet. 

It looks like a better alternative for the Ask/Bid in this instance. 

Thank you for the insightful suggestion, Conor! 
 
Chika Echezona Anumba #:
That's interesting! 

THE use of the 'Opening price' of the current bar is what I've not actually considered yet. 

It looks like a better alternative for the Ask/Bid in this instance. 

Thank you for the insightful suggestion, Conor! 

It's often better to use Open price in a lot of indicators especially in automated trading, because the close price of the current bar is always moving up and down constantly confusing the indicator