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Two Directional Grid w/Range

  • #1
  • First Post: Jun 17, 2007 11:13pm Jun 17, 2007 11:13pm
I've found a new strategy with grid system...

I modified the grid system with 2 direction (buy and sell) with a range

example :

GBP/USD 1.9775 we put buy..
so with 25 range we put sell, buy, sell, etc above 1.9775
alse with 25 range we put sell, buy, sell, etc below 1.9775
here the position

...
1.2050 sell stop
1.2025 buy stop
1.2000 sell stop
1.9975 buy stop
1.9950 sell stop
1.9925 buy stop
1.9900 sell stop
1.9875 buy stop
1.9850 sell stop
1.9825 buy stop
1.9800 sell stop
1.9775 start here buy
1.9750 sell stop
1.9725 buy stop
1.9700 sell stop
1.9675 buy stop
1.9650 sell stop
1.9625 buy stop
1.9600 sell stop
1.9575 buy stop
1.9550 sell stop
1.9525 buy stop
1.9500 sell stop
...

this system reduce the explotion if the price goes very up or goes very down without any retracement...

Any thought about it will be appreciate...
  • #2
  • Jun 17, 2007 11:38pm Jun 17, 2007 11:38pm
when will we take profit?
Simplicity your Life
  • #3
  • Jun 18, 2007 12:32am Jun 18, 2007 12:32am
we can just close the positive one follow by negative one (just close 2)
here's example :

if we buy at 1.9775 and the price go down to 1.9600

1.9775 buy -> -175 pips
1.9750 sell -> 150 pips
1.9725 buy -> -125 pips
1.9700 sell -> 100 pips
1.9675 buy -> -75 pips
1.9650 sell -> 50 pips
1.9625 buy -> -25 pips
1.9600 sell -> 0 pips

you can close 1.9700 and 1.9675 or you can close 1.9750 and 1.9725
  • #4
  • Jun 18, 2007 7:49am Jun 18, 2007 7:49am
Hi Budi, thanks for sharing. Attached is an ea for placing your trades. I did not write it, it was freely given on another forum. Let me know if you have any problems using it.
Attached File(s)
File Type: mq4 GridTrader.mq4   5 KB | 1,062 downloads
  • #5
  • Jun 18, 2007 1:46pm Jun 18, 2007 1:46pm
We need some statistics here to help understand how we profit on this. Can you provide them?

Thank you.
  • #6
  • Jun 18, 2007 2:10pm Jun 18, 2007 2:10pm
I think you need to get some stats on this, because it doesn't make 100% sense.

Why would you only close 2 items? The purpose of the grid is to refill those taken items as the pair ranges between points. The con against taking only 2 items off the table is that you need to know which direction the price is going in order to make the optimum choice. By arbitrarily picking 2 price levels to declare profitable, you're making an assumption about where the price is going next. This defeats the purpose of using a grid because if you knew where the price was going next, you'd just take a trade and go with the flow.

Quoting budi_838
we can just close the positive one follow by negative one (just close 2)
here's example :

if we buy at 1.9775 and the price go down to 1.9600

1.9775 buy -> -175 pips
1.9750 sell -> 150 pips
1.9725 buy -> -125 pips
1.9700 sell -> 100 pips
1.9675 buy -> -75 pips
1.9650 sell -> 50 pips
1.9625 buy -> -25 pips
1.9600 sell -> 0 pips

you can close 1.9700 and 1.9675 or you can close 1.9750 and 1.9725
  • #7
  • Jun 18, 2007 9:09pm Jun 18, 2007 9:09pm
1.9775 buy -> -175 pips
1.9750 sell -> 150 pips
1.9725 buy -> -125 pips
1.9700 sell -> 100 pips
1.9675 buy -> -75 pips
1.9650 sell -> 50 pips
1.9625 buy -> -25 pips
1.9600 sell -> 0 pips

from 1.9775 fall to 1.9600 total pips = -100 pips
from range 1.9775 to 1.9600 (range=175 pips) but we just got -100pips (that's why i said this system reduced minus pips from the other grid system)

but how about this : (we start sell from 1.9775)
1.9775 sell -> 175 pips
1.9750 buy-> -150 pips
1.9725 sell-> 125 pips
1.9700 sell-> -100 pips
1.9675 sell -> 75 pips
1.9650 buy-> -50 pips
1.9625 sell -> 25 pips
1.9600 buy-> 0 pips
total ==> profit 100 pips...

from the example :
1.9775 buy -> -175 pips
1.9750 sell -> 150 pips
1.9725 buy -> -125 pips
1.9700 sell -> 100 pips
1.9675 buy -> -75 pips
1.9650 sell -> 50 pips
1.9625 buy -> -25 pips
1.9600 sell -> 0 pips
we can close 1.9750 and 1.9725
or
1.9700 and 1.9675
why ?
because at 1.9750 (150pips) and at 1.9725(-125pips) so we get 25 pips (we can substract spread about 4 pips), so we got net 21 pips

we close two position (positive pips one and negative pips one) and (positive one must greater than absolute value of negative one) because if we leave the negative one, it will increase our minus pips if price goes the opposite direction from the negative one we leave..

after we close the two position, we must replace it again with buy stop or sell stop

so how we got our profit at all?
we can our profit if the price ranging, whipsawed and retrace (it is always happen in forex)
  • #8
  • Jun 19, 2007 7:46am Jun 19, 2007 7:46am
Quoting budi_838
1.9775 buy -> -175 pips
1.9750 sell -> 150 pips
1.9725 buy -> -125 pips
1.9700 sell -> 100 pips
1.9675 buy -> -75 pips
1.9650 sell -> 50 pips
1.9625 buy -> -25 pips
1.9600 sell -> 0 pips

from 1.9775 fall to 1.9600 total pips = -100 pips
from range 1.9775 to 1.9600 (range=175 pips) but we just got -100pips (that's why i said this system reduced minus pips from the other grid system)

but how about this : (we start sell from 1.9775)
1.9775 sell -> 175 pips
1.9750 buy-> -150 pips
1.9725 sell-> 125 pips
1.9700 sell-> -100 pips
1.9675 sell -> 75 pips
1.9650 buy-> -50 pips
1.9625 sell -> 25 pips
1.9600 buy-> 0 pips
total ==> profit 100 pips...

from the example :
1.9775 buy -> -175 pips
1.9750 sell -> 150 pips
1.9725 buy -> -125 pips
1.9700 sell -> 100 pips
1.9675 buy -> -75 pips
1.9650 sell -> 50 pips
1.9625 buy -> -25 pips
1.9600 sell -> 0 pips
we can close 1.9750 and 1.9725
or
1.9700 and 1.9675
why ?
because at 1.9750 (150pips) and at 1.9725(-125pips) so we get 25 pips (we can substract spread about 4 pips), so we got net 21 pips

we close two position (positive pips one and negative pips one) and (positive one must greater than absolute value of negative one) because if we leave the negative one, it will increase our minus pips if price goes the opposite direction from the negative one we leave..

after we close the two position, we must replace it again with buy stop or sell stop

so how we got our profit at all?
we can our profit if the price ranging, whipsawed and retrace (it is always happen in forex)

interesting
Simplicity your Life
  • #9
  • Jun 19, 2007 8:43am Jun 19, 2007 8:43am
I'm sorry, I just don't understand. Mrmikails caution makes good sense, have you considered it?
  • #10
  • Jun 20, 2007 3:36am Jun 20, 2007 3:36am
mikejody,

you don't need to worry about price movement if you use this strategy..
we don't know where the price will go..
price may go up and down..
price will trending..
price will ranging...
price will whipsaw...
price will retrace...
who knows?

because of that we can use this strategy to overwhelm this condition..

if anyone can make EA to test this strategy, it will be a nice improvement..
  • #11
  • Jun 20, 2007 3:44am Jun 20, 2007 3:44am
Are you there, Gwan?
Do you have a moment to look at this
grid method?


FXS
  • #12
  • Jun 20, 2007 4:44am Jun 20, 2007 4:44am
yes... everyone will be welcome to critic, improve, and modify this strategy...
all for our good...
  • #13
  • Edited 7:23am Jun 20, 2007 4:58am | Edited 7:23am
Quoting FXSurfer
Are you there, Gwan?
Do you have a moment to look at this
grid method?


FXS
i'm not worthy... not worthy.....
... i stay away from 2 way grid... it is complicated
by the way i see it, he hedge profit every 25 pips.....

so the risk will be : if the limit / stop trigered is odd.... thats the only problem i see
:-??
his example (in short)
1.9900 sell stop hedge with 1.9875 buy stop
1.9850 sell stop hedge with 1.9825 buy stop
1.9800 sell stop hedge with 1.9775 start here buy
1.9750 sell stop hedge with 1.9725 buy stop
1.9700 sell stop hedge with 1.9675 buy stop
1.9650 sell stop (if this one failed to be hedged, eg, the price goes up again, it will eat up the profit with 1/2 of the grid range (BEP at 1.9775))

it gives pause between 1.9875 buy stop to 19850 sell stop , and its interval....... if the price reverse in this area, the hedge is unafected.

should all position hedged , the accumulated profit may gives advantage if he get clear signal ... or release them on range market maybe?

and yes, closing order is not that matter, because the hedge, as long the 2 (1 buy & 1 sell) closed together, total sum of profit is unafected...
eg:
1.9900 sell stop hedge with 1.9875 buy stop profit = 25
1.9850 sell stop hedge with 1.9825 buy stop profit = 25 : total = 50
if exchanged :
1.9900 sell stop hedge with 1.9825 buy stop profit = 75
1.9850 sell stop hedge with 1.9875 buy stop profit = -25 : total = 50

amen,
ps: spread ignored for simplicity
  • #14
  • Jun 21, 2007 9:21pm Jun 21, 2007 9:21pm
hi Gwan,
it's a nice explanation...
it's a problem if the grid if not full hedged.. (failed to hedge each other)...
do you have any solution to solve this problem?
  • #15
  • Last Post: Jun 22, 2007 6:03am Jun 22, 2007 6:03am
Quoting budi_838
hi Gwan,
it's a nice explanation...
it's a problem if the grid if not full hedged.. (failed to hedge each other)...
do you have any solution to solve this problem?
sorry i found no cure about that problem,,, but if it is to be treated as 2 way grid, i think it is better to goes back into ranging market as mrmikal says...

Good luck
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