Historical test result
Your news trade won. But your whole test lost 74 dollars.
Your winning news days do not save your test when your losing news days are larger. On a 100,000 dollar account that loss costs you about 74 dollars, which is small next to your daily loss limit.
Why you want to keep only the winner
Many traders tell you to keep only what won. You hear it before you pay for a challenge. You keep the green news type and you drop the red ones. If one news type worked, trade only that one.
That idea feels safe. You think fewer news types mean fewer losses. You think focus on the winner keeps your test green. You want a simple rule you can follow on busy days. I get that wish because a short list feels easier than a full test.
But your challenge does not let you erase bad days after they happen. You must trade your rules as you wrote them before the month starts. If your rules say you trade all news days, your test must show all news days. When you cut the losers after you see them, you test a new rule on old days.
What I tested
I ran a carry test to check that idea. A carry test holds currency pairs for interest and news days move the prices. I ran it on G10 FX crosses, the major currency pairs, from 2021 to 2023. I split the result by news type and I did not drop any type after seeing the numbers.
I kept the rules the same for all days. I did not change them for one report or one week. That way the losers stay in the total and the winner does not hide them. You need that full total before you pay a fee.
What the numbers showed
CPI, the US inflation report, lost about 7.4 dollars on 10,000 dollars. FOMC, the Fed rate decision, lost about 4.4 dollars on 10,000 dollars. NFP, the US jobs report, gained about 7.5 dollars on 10,000 dollars. In the carry test, NFP days were positive while CPI and Fed days lost. Picking NFP only after seeing this is curve fitting.
Curve fitting means you pick rules that fit the past.
You see the trap here. The NFP part looks green on its own. The CPI and Fed parts are red. When you put all days together, the red parts eat the green part. If you show only NFP, you lie to yourself about the full month.
Why picking the winner after the test fails you
You did not know the winner before the test. You learned it from the same days you now want to judge. That is like looking at the answers and then picking the questions you liked. Your next month has new days with new answers.
Your live account must take the days as they come. You cannot tell your challenge firm to delete CPI days from your record. If you want to skip a news type live, you must write that skip into your rules before you test. Then you test the skip on all days, not only on days that help you.
I never pick one news type after seeing the test, because that pick fits the past and not your next challenge.
Check your own report in five minutes
Open your report and compare your NFP days with your CPI and Fed days to see if the full test still loses.
Start with the full total first. Look at all news days together and write down if the total is green or red. Then look at each news type on its own. If only one type is green and the full total is red, your winner does not carry your challenge.
Do not delete the red types to make the total green. Keep them in and ask if your rules can live with them. If your rules must trade them, you must accept their losses in your plan. That honest total tells you more than a picked winner.
These are historical test results, not a live account.
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