Directional Layering
- Experts
-
Tang Wai Ho
I am Michael Tang, a trader, trading educator, and founder of Secret Trader Asia.
I have been involved in the financial markets since 2015, with a strong focus on price action, market structure, risk management, trading indicators, and automated trading systems. - Version: 1.2
- Activations: 5
Directional Layering
Directional Layering is an automated Expert Advisor for MetaTrader 5 designed around trend-following, pullback entries, controlled position layering, basket management, and a one-time recovery hedge.
The EA first identifies the main market direction using two Exponential Moving Averages on a higher timeframe. It then waits for a pullback on the entry timeframe before opening the initial position.
Instead of opening multiple positions immediately, additional positions are added only when price moves by a predefined distance against the active basket.
Main Strategy
- Higher-timeframe EMA trend detection
- Pullback-based initial entry
- Adjustable initial lot size
- Configurable lot multiplier
- Maximum number of layering positions
- Adjustable distance between layers
- Basket-based profit target
- Spread filter for new entries
- One-time recovery hedge after the maximum number of layers is reached
- Adjustable hedge volume
- Two hedge exit modes
- Floating drawdown protection
- Automatic broker volume and margin validation
Entry Logic
The default configuration uses:
- Fast EMA: 50
- Slow EMA: 200
- Pullback EMA: 20
- Trend timeframe: H1
- Entry timeframe: M15
When the Fast EMA is above the Slow EMA, the EA looks for BUY opportunities.
When the Fast EMA is below the Slow EMA, the EA looks for SELL opportunities.
An entry is considered only after price pulls back toward the configured Pullback EMA.
Layering Management
If price moves against the initial position, the EA can add another position after the configured Layer Distance is reached.
Each new layer can use a progressively adjusted lot size according to:
Initial Lot × Lot Multiplier
The maximum number of positions can be controlled through Max Layers.
This provides a structured approach to position layering instead of opening all exposure at once.
Basket Exit
Directional positions are managed as one basket.
The basket profit target is calculated from the weighted average entry price of all active positions in the same direction.
When the configured Basket TP distance is reached, the EA closes the basket.
Recovery Hedge
After the maximum number of layers has been reached, if price continues moving against the basket by the configured Hedge Trigger distance, the EA can open one opposite recovery position.
The recovery hedge size is calculated from the total basket volume and the selected Hedge Lot Multiplier.
Two recovery exit modes are available:
Recovery Threshold
Closes the complete basket when combined floating P/L recovers to the selected threshold.
Profit Target
Keeps the basket active until combined floating P/L reaches the selected monetary profit target.
For the intended multi-position and opposite-position behavior, a MetaTrader 5 hedging account is recommended.
Risk Protection
Directional Layering includes several execution and risk filters:
- Maximum spread filter
- Maximum floating drawdown percentage
- Margin availability check before every new trade
- Broker minimum/maximum volume validation
- Broker volume-step normalization
- Symbol volume-limit validation
- Automatic filling-mode selection
When the configured floating drawdown protection level is reached, the EA closes its managed positions on the active symbol.
Important Notes
Directional Layering uses position layering and recovery hedging. These techniques can increase total market exposure during prolonged directional movements.
There is no trading system that can guarantee profits or eliminate risk.
Recommended before live trading:
- Backtest the EA using your broker's historical data
- Run forward testing on a demo account
- Adjust lot size according to account balance and risk tolerance
- Optimize Layer Distance and Basket TP for the traded symbol
- Use conservative settings when trading volatile instruments
Results can vary significantly between symbols, brokers, spreads, leverage, execution conditions and market periods.
Directional Layering is a trading tool, not a guarantee of future performance.
