Backtesting is the cornerstone of any profitable trading strategy. If you've ever come across the Doyle Exchange strategy — a popular method based on price action, structure, and order blocks — you may wonder how to reliably test its effectiveness before risking real capital. In this blog post, we’ll break down how to backtest the Doyle Exchange strategy step by step, using a structured and realistic approach.

What Is the Doyle Exchange Strategy?

The Doyle Exchange strategy, created by Doyle Exchange (a trader known for his clear, structured approach to trading), is rooted in key concepts such as:

• Market structure shifts (i.e., breaking highs/lows)
• Order block entries
• Liquidity sweeps
• Fair value gaps (FVGs)
• Session-based trading (primarily London and New York sessions)

The strategy focuses on identifying supply and demand zones and entering trades based on structural confirmation, often after a liquidity grab.

Step-by-Step: Backtesting the Doyle Exchange Strategy

Step 1: Choose Your Market and Timeframe

Most traders using the Doyle method focus on forex pairs, especially high-volume ones like:

• EUR/USD
• GBP/USD
• XAU/USD (Gold)

Doyle primarily trades the 15-minute and 5-minute charts, zooming in during the NY or London sessions. Choose the pair and timeframe you're most comfortable with.

Step 2: Select a Backtesting Platform

To effectively test this strategy, use a platform with the following capabilities:

• Replay/historical data with session segmentation
• Drawing tools for marking order blocks, FVGs, and liquidity
• Trade journaling features

Recommended Platforms:

• FX Replay – Tailored for intraday and price-action strategies with clean replay tools.
• TradingView (Replay Mode) – Widely used with ample data and drawing tools.

Step 3: Set Clear Entry Criteria

Here’s an example of Doyle-style entry logic:

1. Wait for liquidity sweep above/under a recent high/low.
2. Look for a market structure shift (MSB – market structure break).
3. Identify the last order block before the break.
4. Enter at the OB or FVG, ideally with confirmation like a rejection wick or a strong engulfing candle.
5. Stop Loss below/above the OB or structure.
6. Take Profit at recent structure, imbalance, or 2R–3R.

Tip: Use session markers to only backtest during NY or London sessions.

Step 4: Mark Up the Chart Before Playing Candles

Before pressing play on your backtesting tool:

• Mark up liquidity zones (equal highs/lows)
• Highlight potential order blocks
• Draw session boxes
• Identify inducement areas

This simulates “live” analysis and prevents hindsight bias.

Step 5: Log Every Trade with Rationale

Create a trade journal (Excel, Notion, or in-platform journal) with:

• Screenshot of pre-trade setup
• Entry and exit points
• Risk-to-reward ratio
• Outcome (Win/Loss)
• Session (London/NY)
• What went well / what didn’t

This helps you recognize patterns and optimize entry conditions.

Step 6: Run Through 20–30 Trades

A statistically significant sample (20–30 trades minimum) gives a realistic idea of the strategy's win rate and risk profile.

Track metrics such as:

• Win rate
• Average R
• Max drawdown
• Trade frequency per week

Use this data to iterate and tweak your rules.

Step 7: Review and Refine

After backtesting, ask yourself:

• Which session had more reliable setups?
• Did certain OB types (e.g., mitigation blocks) work better?
• Were FVG entries riskier than OBs?

Use this review to refine your edge. You might develop sub-strategies like "OB + FVG combo only after NY open."

Pro Tips for Effective Backtesting

• Disable candles during analysis: Do not peek ahead.
• Use partial speed: Play candles slowly to simulate live price action.
• Avoid cherry-picking: Log every setup, even if it looks bad.
• Stick to the plan: Do not change entry rules mid-backtest.

Final Thoughts

Backtesting the Doyle Exchange strategy isn't just about tracking wins and losses. It's about deeply understanding how price reacts to liquidity, structure, and smart money concepts. With consistent practice and refinement, you'll gain confidence to apply the strategy live — or tweak it into your own profitable system.

Want to See a Live Backtest?

Check out our YouTube channel where we break down Doyle-style trades in real-time with detailed analysis.