SPEC-EAV-001 v0.2 · Layer L3 Execution and verification
E-06 Traces of look-ahead bias
E-06 tests whether the recorded accuracy is attainable. Entry timing is examined against the price movement immediately following it, and the combination of win rate and payoff ratio is tested against the statistically possible range.
What it examines
Entry timing against subsequent price movement; win rate against payoff ratio.
How it is computed
Accuracy of entry relative to the price movement that follows. Test whether the observed win rate and payoff combination falls inside a statistically attainable range.
What a defect means
Where future information enters a backtest, accuracy appears that cannot be realised. This must be caught before live trading, not after.
Judgment states
| Pass | The structure is observed and meets the threshold. |
|---|---|
| Caution | The structure is observed but sits at the boundary of the threshold. Evidence figures are presented alongside. |
| Defect | The structure is not observed, or clearly falls outside the threshold. |
| Not judgeable | The required input data is absent. Marked distinctly from a pass. |
Threshold
Not fixed. Determined from calibration data. See SPEC-EAV-001 §11.
Basis
Jung Chunghwa, FX Market Structure and Systematic Trading (2026), ISBN 979-11-220192-1-6. Research note R-001, Structural problems of EA-based systematic trading (2026-08-20).
Questions this item answers
- How do I detect look-ahead bias in backtest results?
- Is my EA's win rate statistically possible?
Related items
Related terminology
Revision · SPEC-EAV-001 v0.2 · 2026-08-21