The Nail in the market's Coffin - Grid Trading?

i thought this up awhile back/. never tested it. makes logic to me but maybe i am wrong.
system:
limit and stop buy sell orders on every x amount of interval pips with take profit at those intervals, small intervals so that the up down movement sets off the tp levels. i think we would pretty much be hedged all the time with a buy and sell order. once tp is hit, new limit and stop order are generated.

so when positions are in losses, you have made up those losses - the spread off course. after trading for awhile, and the price is between two close intervals, we get out of all the positions

or does the spread kill the killing of the forex market???? LOL

Look up grid trading, and see why straight grid trading doesn't work.

Hi Ronald

Just did a search on grid trading. Can't find something about it - can u point me to the thread please ?

Tex,
Grid trading will leave dangler trades that turn into big losses.

I believe that if applied correctly grid trading it can be profitable, but that's just my opinion.

There is a forum section about this

http://www.forex-tsd.com/martingale-...indicator.html

Back in the day (when I refused to take losses) I studied, developed, and tested a variety of grid systems. Did this for about 2 years or so... probably my most extensive effort to date, in terms of strategy development. Needless to say, I learned how to take losses and moved on (thank God).

Long story short, my vote for best grid system goes here....
http://www.forexfactory.com/showthread.php?t=109589

Can't have thread on Grid Trading with mentioning Bird Watching in Lion Country. Long term trades running in the background and short term bread&butter trades here and there.

hey andre..... not sure how the hedging aspect would benefit the plan overall but well placed orders single direction can work.... sometimes.....

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most, if not all, grid systems suffer the same weakness.... the very last orders can wipe out so much of the prior gains.....

to help over come this, place stop/limit orders in a trailing fashion.... trailing grids....

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as example, say your selling.... normaly sell limits are placed above and sell stops below.... if the market goes up hard, each of those selllimits activated will add to the draw down.....

so instead don't use the selllimits above, or use them sparingly, and use trailing sellstops below that will rachet higher, ordermodify, as the price moves higher.... and when the market falls back your sellstops will be activated at higher/better price....
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also, try not to place any additional orders outside the average daily range/support/resistance/pivots and such....

trade reasonably and let the orders keep building in your favor.... even if it means you have hundreds profitable on the board...... i've posted dozens of pictures before, look for account 53208, a live ibfx mini.....



all that might sound confusing..... take some time and think about it....

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btw, if ya don't mind, hold off a bit putting that last nail in the markets coffin just yet..... maybe you could just use a stout leash for awhile.......... cause i kinda need a new tractor.......h

close to what hayseed is sayin

i knew someone who traded very profitably determining trend using a moving average and some higher timeframes

say trend is up

he would only place buy stops with take profits

he would reload and add more as price drops

with a big enough account even if trend reversed and u end up closing some old losing positions u would have made some decent profits

or if trend suddenly reverses hard u can keep placing buy stops but with wider intervals for example

the thing is most people overlook the fact that determining trend is fairly easy and they end up thinking well its too easy what if it reverses well chances are market will give u plenty of chances to get out at least at breakeven

now i know there are instances when everything just goes wrong

well thats simply part of the game

someone took 60k to close to 300k adding positions as price drops using micro lots and determining trend using an ma on the daily chart

he would add as price drops at random intervals and using micro lots

on decent support hll add multiple positions

he played the intraday volatility and banked hardddd and by the time price came back to his average he had already made up a big chunk of his losses

so yea its possible u just gotta account for the worst scenario and expect even worse conditions once u start trading live and u should survive

i understand all the danger for grid trading. what im saying is to have a buy stop, sell stop, buy limit and sell limit at all the intervals. at every interval is your tp. when tp is hit, the last interval which is closed is reopened again with a buy sell stops and limits. doesnt this mean that as price goes, we re making profit? and at some time, when price is between two intervals, we get out at a loss but we have made that up that loss 10 times over or 100 times over depending on how long we let this run? am i mistaken? if not, can we get an ea going to test it?

thanks for the interest in this thread.