Scalping Price Action EA MT5

This EA is based on scalping price action supply and demand zone/breakout EA strategy. 

(1)

-The EA Identifies supply and demand levels on the chart using key price reversal points or support/resistance areas.

-it then waits for price to break above a supply level or below a demand level.

-It confirms the breakout with an upwards or downward momentum indicators such as moving averages, the MACD, or the RSI.

-It then enters a long trade if price breaks above a supply level with bullish confirmation or a short trade if price breaks below a demand level with bearish confirmation.

(2)

-It considers factors like support and resistance levels, trend directions, volatility, and candlestick patterns such as bullish or bearish engulfing patterns as entry signals within the identified zones.

-It should be programmed to accurately identify the supply and demand zones on the price chart. This can be achieved by using various technical analysis techniques like identifying significant swing highs and lows, support, and resistance levels. 

-Once the zones are identified the EA should have precise criteria for entering trades. It should look for specific price behaviours or patterns within the zones, such as a reversal candlestick pattern, a break or retest of a zone or a significant increase in volume.

These criteria should be back tested and optimised to ensure effectiveness.

(3)

-After determining the entry point, the EA places a buy or sell order with appropriate position sizing.

(4)

-It should be able to adapt to the changing of the market, then it may set stop loss and take profit levels to manage risk and potential profit target.

-The EA must set a stop loss order just above the supply level or below the demand level to manage risk.

-During the trade the EA continuously monitors price movements and adjusts stop loss and take profit to protect profits and minimize losses.

-It may also employ trailing stops to secure/lock in profits as the trade progresses/moves in favour of the trade opened.

-The EA must take profit when price reaches the next significant supply or demand level 

-Alternatively, use predetermined profit targets based on support/resistance levels, Fibonacci extensions, or pivot points.

(5)

-The EA takes advantage of short-term price movements within the supply and demand zones to scalp small profits.

-The expert advisor would execute quick trades, aiming to capture smaller price movements while minimizing exposure to market volatility.

-It may exit trades quickly to capitalize on immediate market opportunities.

(6)

-Once the trade reaches the predetermined take-profit or stop-loss levels, or if the market conditions change, the EA will exit/close at the current market price when the take-profit or stop-loss level is reached.

This ensures that the trade exited, and any profits or losses are realized.

-The expert advisor should update the trade statistics, including the outcome (profit or loss), trade duration, and other relevant metrics. This information can be used for analysis and performance evaluation.

-It is important for the expert advisor to log the trade result in a trade journal or record-keeping system. This helps in maintaining a trading history and evaluating the effectiveness of the strategy over time.

-After closing a trade, the expert advisor may evaluate whether there is a potential opportunity to re-enter the market based on the trading strategy. It can analyse the market conditions, price action, and other relevant factors to determine if it should open a new trade.

-Even after closing a trade, the expert advisor should continue monitoring the market for any new potential trading opportunities. It should be able to adapt to changing market conditions and be prepared to open new trades based on the defined strategy.

This allows the EA to continually search for and capitalize on new scalping opportunities.

(7)

-The EA should be able to anticipate situations where a price level is about to break out of a supply or demand zone indicating a potential trend reversal or continuation.

-The EA should have a mechanism to identify breakouts in the price action by comparing the current price to predefined support and resistance levels or trend lines.

-Once a breakout is identified, the EA should open a trade in the direction of the breakout. It can use a market order or a pending order.

-The EA must enter a trade when price retraces back to a supply or demand zone after a breakout as a confirmation of a continuing trend. 

-In case of a false breakout or a retracement after a successful breakout, the EA can have rules for re-entering the trade based on market conditions and price action patterns.

-It is important for the EA to be adaptable to different market conditions such as trending or ranging markets. It should adjust its strategy accordingly to avoid false breakouts or excessive trade entries.

-In range-bound markets, The EA should detect the upper and lower limits of the range and determine key support and resistance levels.

-The EA should monitor price movements near the support and resistance levels to confirm if a breakout is occurring. It can use indicators or patterns to validate the breakout.

-The EA should enter trades when breakout is confirmed: Once a breakout is confirmed, the EA should enter trades in the direction of the breakout. This could be a long trade if the price breaks above resistance, or a short trade if the price breaks below support.

-The EA must set appropriate stop-loss and take-profit levels: The EA should calculate optimal stop-loss and take-profit levels based on the range-bound market conditions. These levels should account for potential price reversals within the range.

-If the breakout continues in favour of the trade, the EA should trail the stop-loss level to lock in profits and protect against potential reversals.

-It is essential for the EA to identify false breakouts, where the price briefly moves beyond support or resistance levels but quickly reverses. In such cases, the EA should exit the trade and avoid losses.

-If the market has been in a well-defined range for an extended period, the EA can temporarily pause trading to avoid false breakouts and choppy price movements.

-The EA should continuously analyse market conditions and adapt its breakout strategies accordingly. This could include adjusting the range boundaries or reevaluating the entry and exit criteria.

(8)

-The EA should anticipate situations where price retraces back to a previously broken supply or demand zone, providing an opportunity for a high-probability trade

-The EA should continuously monitor the market conditions to identify when the price retraces back to a previously broken supply or demand zone.

-The EA should find out the strength of the zone by evaluating factors such as the number of times the zone has been tested before and the price action behaviour within the zone

-The EA must measure the depth of the retracement to determine if it is significant enough to provide a trading opportunity.

-The EA could use additional technical indicators such as moving averages, trend lines, or oscillators to confirm the validity of the retracement.

-The EA should assess the trading volume and liquidity to ensure that there is enough activity in the market to support a potential breakout trade.

-If all the above criteria are met, the EA could place pending orders (buy or sell) at appropriate levels near the previously broken supply or demand zone.

-Once the pending orders are triggered, the EA should closely monitor the trade progression using pre-defined rules. It could trail the stop loss, lock in profits, or exit the trade if the market conditions change.

-As the price action evolves, the EA might need to periodically adjust the levels of the supply or demand zones to reflect new market developments.

-The EA should incorporate exit criteria such as reaching take profit, hitting stop loss, or spotting a potential reversal signal to exit the trade and secure profits or limit losses within the desired risk-reward ratio.

(9)

-The EA should be designed to consider the impact of significant news events on supply and demand zones. 

-It should anticipate situations where the market volatility increases, creating potential trading opportunities. 

-In periods of low liquidity, such as during holidays or major market closures, the EA should anticipate situations where supply and demand imbalances are more likely to occur. 

-A news filtering system should be implemented in my EA to identify and minimize trading during major news announcements. It can utilize economic calendars or news APIs to extract news data and incorporate it into my strategy. By avoiding trading around significant news events, the EA can prevent sudden and unpredictable market volatility.

(10)

-It should adapt its trading strategy to account for the lower liquidity and potentially wider spreads.

-The EA will typically include risk management features to protect against excessive losses which includes potential downside, trailing stop orders to lock in profits and position sizing algorithms to determine the appropriate trade size based on account balance and risk tolerance. 

(11)

-The scalping price action supply and demand breakout EA should be able to anticipate situations where supply and demand imbalances occur, providing trading opportunities for capturing short-term profits.

-The EA should have a mechanism to identify when there is a significant supply or demand imbalance in the price action. This can be done by analysing factors such as volume, liquidity, or price volatility.

-If the EA identifies a significant imbalance, it should trigger a trade in the direction of the breakout. For example, if there is a supply imbalance, the EA should enter a short trade. Conversely, if there is a demand imbalance, the EA should enter a long trade.

-The EA should have predefined stop-loss and take-profit levels to manage the trade. These levels should be set based on the volatility of the market and the strength of the imbalance.

-The EA can also adjust the position size based on the strength of the imbalance. If the imbalance is strong, the EA can increase the position size to maximize potential profits. Conversely, if the imbalance is weak, the EA can decrease the position size to minimize potential losses.

-Even though the EA is based on breakout strategies, it should still monitor the price action for any signs of potential reversals. If the imbalance weakens or the price action shows signs of a reversal, the EA should consider closing the trade to protect profits or limit losses.

-The EA can implement/execute trailing stops to lock in profits as the trade moves in the desired direction. This way, if the price retraces after the breakout, the EA can still exit the trade with a profit.

-The EA should regularly update its analysis of supply and demand imbalances to adapt to changing market conditions. This can be done by using indicators or other technical analysis tools to identify and monitor these imbalances.

(12)

-The EA can send real-time alerts or notifications to the trader when specific trading conditions are met. 

-This allows the trader to stay updated on trade opportunities and make informed decisions 

More special features the EA should have/contain.

-The EA can assess supply and demand zones on different timeframes, increasing the accuracy of its trading signals.

-When activated, the EA can move the stop loss to the entry point after a certain amount of profit is reached, ensuring that the trade at least breaks even

-The EA can be programmed to partially close a trade at specific profit targets, allowing for the capture of profits while still leaving a portion of the trade running for potential further gains.

-By analysing past trading data, the EA can identify patterns and optimize its strategy, accordingly, improving performance over time.

-Users should have the ability to customize various parameters of the EA, such as the minimum distance between supply and demand zones, the size of each trade, and the maximum number of trades allowed simultaneously.

-The EA can calculate and adjust the risk-reward ratio of each trade based on the distance to the nearest supply or demand zone, optimizing trade entries according to the potential profit

-Orders can include an expiration feature, automatically cancelling unexecuted trades after a specified period of time, preventing the EA from trading in stale or outdated supply and demand zones.

-The EA should have an intuitive and user-friendly interface can make it easier for traders to interact with the EA, adjust settings, and monitor performance.

-The EA should have an option to select specific trading sessions when the EA should trade and when it should stay on the sidelines.

-The EA should have a multi pair functionality which has the ability to trade on multiple currency pairs simultaneously, diversifying the trading portfolio.

-The EA should have a trade journaling allowing the user to log and analyse trades, including details such as entry/exit prices, stop losses, and profit targets.