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Hedge and Correlation Strategy

  • #1,921
  • Jan 30, 2011 9:49pm Jan 30, 2011 9:49pm
Quoting occamsrazors
Yep, no probs SM wasn't expecting you to look at it, I should have said that. Just mentioned it in case anyone else was trying to use it. Maybe Roundrock might have a look if he gets a chance, I think he said he hadn't had a chance to test it live yet when he posted it.... Thanks for your indi btw...
you can use this if you want, i added combined spread. combined spread is sum of both symbol spreads.
Attached File(s)
File Type: mq4 Tradable Correlations with spreads.mq4   13 KB | 1,297 downloads
  • #1,922
  • Jan 30, 2011 10:09pm Jan 30, 2011 10:09pm
Quoting roundrock
you can use this if you want, i added combined spread. combined spread is sum of both symbol spreads.
That's great, thanks RoundRock!
  • #1,923
  • Jan 30, 2011 10:11pm Jan 30, 2011 10:11pm
Quoting Dreamliner
Good job, Ray! Did you switch to 15 minute timeframe before the trade or after you entered it?
After entry and then when the respective pairs stared to converge. I also set a trailing stop. Even now both pairs have crossed and are moving away from each other. GA and GU now 21%, GA & GJ now 24% difference.
The entry strategy is fine, the TP needs our attention and I think trailing stops be placed once the trade is profitable rather than exiting at 50% or 20%.
  • #1,924
  • Jan 30, 2011 10:21pm Jan 30, 2011 10:21pm
Quoting roundrock
you can use this if you want, i added combined spread. combined spread is sum of both symbol spreads.
This indicator is working fine now and very handy displaying the spread.
Is it possible to modify the indicator to click on the symbols and open a buy/sell order?
Many thanks for your excellent work.
  • #1,925
  • Jan 30, 2011 10:44pm Jan 30, 2011 10:44pm
Quoting smjones
I found a possible bug in the global variable sets that I have fixed in this version 1.6b.
Thanks for your (and the rest people in this thread) invaluable and generous support. I want to ask if you have any suggestions for those of us who operate in m2 offline charts, especially with the stochastic diferent pairs because it looks a little different than normal working TFs.

Wish you all the best of the best . . .
Attached Image (click to enlarge)
Click to Enlarge Name: ofline chart.gif Size: 31 KB
Humble & Kalcker CLO2 = Covid killer
  • #1,926
  • Jan 31, 2011 12:57am Jan 31, 2011 12:57am
today's usdchf corelation is -39%,is it correct to trade this pair?
  • #1,927
  • Jan 31, 2011 1:35am Jan 31, 2011 1:35am
Sorry, I am new to MT4. When I drage the stochastic diff. indicatior in to the window (EUR/USD). It shows "EUR/USD diff 27% concides with XXXXXX, correlation D1 @ 50 Period =-200%."

I have overlaied EUR/USD and USD/CHF chart.
  • #1,928
  • Jan 31, 2011 1:40am Jan 31, 2011 1:40am
Quoting roundrock
you can use this if you want, i added combined spread. combined spread is sum of both symbol spreads.
As always excellent work Roundrock. Thank you !!
  • #1,929
  • Jan 31, 2011 2:06am Jan 31, 2011 2:06am
Hi guys. Excellent thread. I like the logic behind the strategy. The great thing is that it can be written down very specifically in only a few lines which is a great help for those who struggle to follow a strategy.

I took a demo trade last night EURAUD/EURJPY (like some here) to see how it goes and it was very nice. Just took the reverse of this as they have inverted and gone past 80%. I will test it more this week.

It would be interesting to see how others are placing orders. Not using any for of EA or script can be a bit slow. The order for the main pair is easy enough but for the second pair I had to go and find it in the list to initiate and order. What this is crying for is some way of easily placing two orders at the same time. I am aware of Steve's bot but I wanted to manualy trade this for a while to get a feel.

Thanks guys for this hard work.
  • #1,930
  • Jan 31, 2011 3:44am Jan 31, 2011 3:44am
Quoting Dreamliner
Tonight so far I've made 34 pips. I'm attaching a picture of my spreadsheet journal if you'd like to see the trades.
Hi Dreamliner, congrats to nice pips, I think I understand this strategy, but i´ve got a question, why is better to trade (sell EUR/AUD, buy EUR/JPY) instead of (buy AUD/JPY), you can save one spread, am I right ? ...

and what about calculating right lot size when you (sell EUR/AUD, buy EUR/JPY) ?...does it matter that average daily range of this pairs is different ?

Thx, Kruspe
  • #1,931
  • Jan 31, 2011 3:54am Jan 31, 2011 3:54am
Trades taken late Asian early London session today ...entry on 80% stoch diff, exit on touch of 50% stoch diff. They tend to come in bursts it seems....

1. Long EURAUD short EURJPY 5 pips
2. Short EURCHF Long GBPAUD 24 pips
3. Long GBPAUD short GBPJPY 15 pips
4. Short EURCHF long GBPJPY 3 pips
  • #1,932
  • Jan 31, 2011 4:09am Jan 31, 2011 4:09am
Quoting occamsrazors
Trades taken late Asian early London session today ...entry on 80% stoch diff, exit on touch of 50% stoch diff. They tend to come in bursts it seems....

1. Long EURAUD short EURJPY 5 pips
2. Short EURCHF Long GBPAUD 24 pips
3. Long GBPAUD short GBPJPY 15 pips
4. Short EURCHF long GBPJPY 3 pips

Excellent Occam.

I have just closed my first trade of the week, Long EUR/AUD, Sell EUR/CHF, entry on 80%, exit at cross: + 9 pips (net profit).
Waiting for the next one..........
  • #1,933
  • Jan 31, 2011 4:27am Jan 31, 2011 4:27am
Quoting Caillou
Excellent Occam.

I have just closed my first trade of the week, Long EUR/AUD, Sell EUR/CHF, entry on 80%, exit at cross: + 9 pips (net profit).
Waiting for the next one..........
Nice work Caillou....working out the best exit is the next step....touch of 50, or confirmed cross of stoch diff 50 (candle close) or touch of stoch diff 20 or confirmed cross of stoch diff 20..... Will be interesting to see where the majority of the pips are for any move...
  • #1,934
  • Jan 31, 2011 4:36am Jan 31, 2011 4:36am
Quoting occamsrazors
Nice work Caillou....working out the best exit is the next step....touch of 50, or confirmed cross of stoch diff 50 (candle close) or touch of stoch diff 20 or confirmed cross of stoch diff 20..... Will be interesting to see where the majority of the pips are for any move...
I agree with you, the exit point is something to work on.....
  • #1,935
  • Jan 31, 2011 4:54am Jan 31, 2011 4:54am
Occamsrazors , good to hear well done trades. I set up 4 charts ,
usdchf gbpchf , eurchf gbpchf, gbpchf gbpjpy and eurchf gbpaud just an hour ago .

I was wondering what TF are you using on charts M1 or M5 .Thanks.
  • #1,936
  • Jan 31, 2011 5:02am Jan 31, 2011 5:02am
Quoting sergen4
Occamsrazors , good to hear well done trades. I set up 4 charts ,
usdchf gbpchf , eurchf gbpchf, gbpchf gbpjpy and eurchf gbpaud just an hour ago .

I was wondering what TF are you using on charts M1 or M5 .Thanks.
Thanks Sergen, all were on the M5
  • #1,937
  • Edited 6:08am Jan 31, 2011 5:20am | Edited 6:08am
Quoting jusiur
Thanks for your (and the rest people in this thread) invaluable and generous support. I want to ask if you have any suggestions for those of us who operate in m2 offline charts, especially with the stochastic diferent pairs because it looks a little different than normal working TFs.

Wish you all the best of the best . . .
The Calculations must have standard mt4 time frames. It has to do with the correlation algorithm and there is no standard history to correlate to, for currencies in offline mode. sorry
  • #1,938
  • Jan 31, 2011 5:56am Jan 31, 2011 5:56am
Hi all

I took another EURCAD (L)/EURJPY (S) at 8:47 GMT this morning and exited when Diff dropped below 50% at 9:35 for 21pips.

I triggered the trades manually on the pairs and then using Close-All script to kill them. Of course this is OK for one set but not if I trade more than one set at a time. In fact I will limit it to one at a time for now and see how it goes.

I will setup the correlated pairs that have a combined spread of 9 or less. This sounds a lot but I have only two at 4/5, three at 8 pips and three at 9. Everything else is 10 or above. These are the Alpari UK live spreads. I am on Demo but I thought I would choose the pairs I would trade live.

I hope this helps.
  • #1,939
  • Jan 31, 2011 6:15am Jan 31, 2011 6:15am
I made 35 scripts for different currency combination today. I put them out here but I'm sure I missed some comb. You can use different lot size on the 2 pairs and you can use magic number.
Attached File(s)
File Type: zip Buy_$_Sell_$.zip   46 KB | 1,010 downloads
  • #1,940
  • Jan 31, 2011 6:22am Jan 31, 2011 6:22am
Quoting Zr-fx
Hi all

I took another EURCAD (L)/EURJPY (S) at 8:47 GMT this morning and exited when Diff dropped below 50% at 9:35 for 21pips.

I triggered the trades manually on the pairs and then using Close-All script to kill them. Of course this is OK for one set but not if I trade more than one set at a time. In fact I will limit it to one at a time for now and see how it goes.

I will setup the correlated pairs that have a combined spread of 9 or less. This sounds a lot but I have only two at 4/5, three at 8 pips and three at 9. Everything else...
Hi ZR

My indi doesn't show the stoch diff (yellow line) getting above 80 for the EURCAD EURJPY (see below). My chart is GMT+2 so I put a red vertical around 10.50 which is 8.50 GMT. Does your chart look like this?
Attached Image
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