Do not derail your stop loss!

Do not derail your stop loss!

9 February 2018, 18:44
Yurij Batura

Using the services of brokers for many years, I, like other traders, repeatedly got into a situation when, at the time of market volatility, the price rolled back just before the stop loss or did not reach the take profit just a few points, which is why the funds on the account abruptly decreased.At first I thought - no luck, but then I began to notice the discrepancy between the history of trading from different brokers. Here is just one example of many: see screenshots of signals of the same situation at the same time from different brokers.

As can be seen in the pictures, a candle from one broker is several times greater than a candle from another. Such actions lead to artificial volatility and, as a result, abnormal operation of indicators. This, in turn, leads to a breakdown of the stop loss and the discharge of the trader's deposit, which is precisely the goal of unscrupulous brokers.

Identify these brokers so as not to fall for their bait, it is very difficult, because they use a "virtual broker" - a software that allows them to adjust the history of trades at any time.

But is it possible to protect your means in this situation? Yes. On the "virtual broker" I have adapted to respond to a virtual stop loss, which does not appear in the terminal at all, but only works when I consider it necessary. That is, in practice for the terminal MT4 in this case, the stop loss simply does not exist, as if you did not install it, which will not allow unscrupulous brokers to determine its location on the chart in order to break it by peaks of volatility.

It was this cunning that I laid in my expert "AI_Syntesis_EA". I built Virtual Stop Loss in it as a percentage of the acceptable drawdown in the PercentLossOrder transaction, which closes the order at a time when the price exceeds the allowable drawdown in the trade. In addition, in order to receive a guaranteed profit, I provided all the orders in the expert "AI_Syntesis_EA" with trailing stops, which are included only after the criterion of rate profitability is revealed, and its value is formed by the volatility indicator ATR. As a result, the price is squeezed between two stops: the less volatility, the closer the trailing stop approaches the take profit, not allowing profits to slip away.

Against this approach, unscrupulous brokers are still powerless))

Share it with friends: