Optimization

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In the context of technical analysis, it is the process of adjusting one's trading system in an attempt to make it more effective. These adjustments include changing the number of periods used in moving averages, changing the number of indicators used, or simply taking away what doesn't work.

Investopedia Says:
For example, if an investor has a simple trading system that is just composed of a crossover of closing price and a moving average, by changing the periods of the moving average, the trader will get different profits, risk, capital drawdowns, etc. Thus, optimization helps you to choose the optimal parameters to trade.

Related Links:
We take a closer look at the linearly weighted moving average and the exponentially smoothed moving average. Weighted Moving Averages: The Basics
We offer some tips on this process that can help refine your current trading strategies. Backtesting: Interpreting the Past
Correlations between backtesting and forward performance testing results can help you optimize your trading system. Backtesting And Forward Testing: The Importance Of Correlation
Automate your trades by translating your strategy into a language your computer can implement in this hands-free approach to investing. Trading Systems Coding
Discover what this trader learned from his mistakes and how to uncover your own. Lessons From A Trader's Diary