Profitable Hedging Lots Strategy - page 3

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AirforceMook:
I'd love to help develop a successful system. I've been messing around with these for some time and never quite mastered it. I still think the concept is absolutely phenomenal, albeit with one major hurdle to overcome before profitability will be hit.

Every martingale system (that I've made, at least) is wildly successful right up until the price begins whipsawing back n' forth and the EA bets far too much, blowing the account. I've tried eliminating all trades at a set loss, etc, but they occur far too often to end up profitable in the end. That is, after all, the point of the martingale system. You'll have massive drawdown only to recover with even larger profits.

Because of this, I'm convinced the only road to a good EA is one that times its reversals well. The fewer reversals needed to recoup the losses, the better.

I think there's two ways to do this, but both are simply trying to identify the exact "tipping point" (peaks and troughs) in the price. This is where you want your reversals to be, otherwise you'll have too many open trades and your free margin will get blown to hell.

Try to directly identify the turns.

I tried looking back and detecting a peak that's larger than the past number of bars. The problem is that when you encounter a large uptrend, it will think just about every bar is a new peak. This results in you betting against the trend the whole way up.

A slightly better method was to detect bars that were in opposition to the current trend. These usually occur at the end of a large movement and are often peaks. Unfortunately, depending on trend detection & other factors, this can result in a lot of false-positives.

Use a lagging indicator that will only move on large turns

MA's are a good example of this. If you watch the slope of the line it will generally stay positive the whole way up until it has reached the top and the trend has turned. The problem is that you reverse far too late to be effective.

I've attached an example pic of a lagging indicator I've been using. It's just a step MA. If the price is currently above both bars, it will stay long. (Reverse for short) You'll notice it still results in a lot of reversals. (4 times there at the end)

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I've also noticed that using larger lots with smaller takeprofits tends to work better. My profitability is above 70% on average. This means that the first trade will usually close profitably. If I decrease the lots or increase the TP points this goes down.

I'm also considering the idea of having a swarm of these on different currencies working together. If one currency begins to overwhelm itself, and the rest are able to help (ie they have profit), close ALL trades to minimize the damage. I have yet to code this at all. It unfortunately cannot be backtested, either.

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Any thoughts folks?

We cannot ignore the impact of TP, SL and Distance parameters in the lags and drawdowns. This EA does use Moving Average to find the direction, but to reduce drawdowns it is important that we use smaller TP values but every setting has its own pros and cons. I do agree with the issues that you have mentioned but to an extent, with proper money management and good mathematical calculations (as this EA is heavily mathematical) you are on a road to winning.

Regards,

Riz

 

I want to avoid using a set TP, SL, etc on any system. Each currency is different and will even change it's "style" over time. Setting a 30/etc TP now might work, but a year from now might not.

I think the only way to do this is to directly identify high-probability turns and use them as reversal points. All of of my EAs have thus far followed that path.

 

mini on nordmarkets

FxFux:
Great WORK RIZ,

now it works perfectly thanks so much.. but now I have another problem.. I want to change broker.. from alpari to nordmarkets.. because alpari allows only 2 lots maximum with a micro account.. and with a classic account minimum lot size is 0.1 to trade.. I need 0.01 lots and so nordmarkets is a good choice I think.. Another advantage is they have only 1 pip spread on eur/usd ..

so I have to open a mini trading account there but now a big problem: on their mini account they trade with mini-lots, so 1 lot on this account is 0.1 (10000) and 0.1 is 0.01 micro lots (1000), the ea gives me error-code: 130 and 131..

can you help please? i hope you understand my problem you know my poor english...

greetz

chris

hey riz,

the mini account is opened on nordmarkets, they are really fast can you help me to get the ea going on this account?

greetz

 

I have re-written this EA, was backtesting it last night, which means that it is still at my home and I am writing this from my work. I have fixed a few bugs and re-written it in a manner that it is debugable for me. Looked like the previous EA was written by a person who teaches in Universities (and so did I) this type of coding is good for demonstration but not very maintainable (debugable). I have gotten rid of Moving averages in the EA as well.

I will hopefully upload it tonight.

FXFux, What kind of help do you need?

Regards,

Riz

 

mini account

hi riz,

the ea isn't working on my new mini account.. I don't know why.. on this account you trade with mini lots.. 1 lot there is only 10000 units instead of 100000 in a normal account.. mt4 gives me error code 130 and 131 in the experts tab.. so on alpari I trade with micro lots (0.01, 0.03, 0.06 and so on).. now on nordmarkets I have to trade with 0.1, 0.3, 0.6 (but these are micro lots too) because 1 lot thre are mini lots.. oh man I have to book an english course I don't know maybe the ea have to be rewritten a little bit to work on this mini account.. many thanks in advice

greetz

chris

 

Did you change the Lots parameter to read 0.1 instead of 0.01?

 

re

yes of course but that doesn't solve the problem.. maybe I can pm my demo mini account login to you? then you can see that the ea doesn't work there.. I think its a coding problem but don't really know.. I would be very appreciate if you can have a look

 

What is your stoploss/distance and tp values?

Regards,

Riz

 

riz

hey riz,

got my private mail?

 

It's a nice idea, it wins, until it will reach the sideways market. Just like frank ea - it also allways wins - until it will reach trend market...

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