My EA Gift to Traders

I understand what the 3 of you are saying but I can't find any fault in the logic which is enclosed.

if (OrderType()==OP_BUY && SetStopLossToBreakEvenPips != 0
&& OrderProfit() >= Wager * SetStopLossToBreakEvenPips * 10
&& BreakEvenCompleted == 0)
{
StopLossPrice = OrderOpenPrice() + Spread + PointValue;
res = OrderModify(OrderTicket(),OrderOpenPrice(),StopLossPrice, TakeWinPrice, 0, clrMaroon);
if (res > -1)
{
CurrProfitTarget = OrderProfit() + (Wager / Close[0] * 50);
BreakEvenCompleted = 1;
BreakEvenPrice = StopLossPrice;
}
}
if (OrderType()==OP_SELL && SetStopLossToBreakEvenPips != 0
&& OrderProfit() >= Wager * SetStopLossToBreakEvenPips * 10
&& BreakEvenCompleted == 0)
{
StopLossPrice = OrderOpenPrice() - Spread - PointValue;
res = OrderModify(OrderTicket(),OrderOpenPrice(),StopLossPrice, TakeWinPrice, 0, clrMaroon);
if (res > -1)
{
CurrProfitTarget = OrderProfit() + (Wager / Close[0] * 50);
BreakEvenCompleted = 1;
BreakEvenPrice = StopLossPrice;
}
}

translated it means -

If the order is a Buy trade (or Sell trade) and the Break Even pips are not zero and the profit is greater or equal to Lot Size * Break Even Pips * 10 and Break Even has not been previously set

Then the new Stop Loss price = Order Open Price + Spread + 1 point

Modify the current Order with the new Stop Loss price

If the order is completed then
Set the Profit Target to 5% extra, mark the Break Even transaction completed and set the Break Even Price (used for calculations in the future).

In the code, you can see that until the modification is actually made, the program will continue to attempt make the modification because BreakEvenCompleted will still be set to Zero.

Also If you look at the trade lists of the EA at the top of the page, you can see evidence of precisely this setting being respected by all the trades closed around the 1 pip profit area.

Todays Discussion: (Refer Post #1301)

How to Combine strategies and Filters
There are actually 13 Strategies and 8 Filters

The primary difference is that a Strategy is normally based on an indicator whereas a Filter is based on an occurence.

The 13 Strategies are

1. EMA Cross
2. Price EMA Cross or Position
3. RSI
4. MACD
5. Stochastic
6. Bollinger Bands
7. PSAR
8. Straddle
9. Continuous Straddle
10. CCI
11. ADX
12. ATR
13. Zig Zag

The 8 Filters are

1. Time and Day
2. News
3. Pivots
4. Fibonacci
5. Support / Resistance
6. Divergence
7. Candlesticks
8. Volume

The Strategies make a type of indication/prediction on the future movement of price whereas the filters act as their name implies to negate or allow trades to pass or fail. The first 5 of the 8 filters act as barriers to the trade. That is if the price or time is within the set boundaries of the filter, no trade will take place as in too close to a News release time or too close to a Support or Resistance level.

Of the 13 Strategies, some are not really appreciated that well. Notably Straddle and Continuous Straddle. A Straddle trade is 2 pending trades (Stop Buy and Stop Sell) placed at a particular Price, Time or Indicator position / cross. A Continous Straddle has the same 2 pending trades placed but as the name implies, it is placed immediately there are no existing trades so there is continuous trade action. In reality you are going with the trend established once the buffer is breached. Always optimize the buffer with any type of Straddle and I recommend all 6 Money Management variables mentioned below also be optimized.

The first 5 filters act as potential barriers to a trade but do not form the fundamental basis of any trading strategy in that they only reject trades if too close. Time and Day is the exception in that it rejects trades outside the boundaries whereas the others reject trades inside the boundaries.

The last 3 filters act differently in that they can provide additional confirmation of a potential trade and can be used in combination with each other to form a trading strategy. Probably the most reliable filter is Divergence and I urge you to do your own research if you do not fully understand the term. Volume increasing in the direction of currency movement serves as a momentum indicator. Candlestick patterns are more reliable on higher timeframes.

Because of the complexity of optimization, I recommend that only 2 (possibly 3 with concessions) strategies and filters be mixed together in an overall strategy.
Here is the point - You are better off optimizing all the variables on 2 Strategies or Filters than accepting the default values on more combinations. If you were to combine 3 Strategies each with 3 variables and a minimum of 3 Money Management variables you have 12 variables to be optimized.

You can reduce the variables and make some indicator values fixed but as a general rule make the maximum 10 variables. That is the guide line. Of course if you are willing to let your computer run overnight on a single optimization you can go beyond that 10 figure but my experience is that if you are trying to line up the simultaneous occurence of 3 indicators (within 5 bars) your trading frequency will be drastically reduced.

Some of the filters have a minimum number of variables and for example you could easily combine the last 3 together with the 6 Money management variables SL, SL Multiple, TP Multiple, Break Even, Min Pip Gain and Decrease SL Percentage. I have left out SL ATR and TP ATR because they are not as effective.

I would prefer you to use as many Money Management variables as possible within the overall 10 variable limit.

In summary, experiment. It is particulary easy in Strategy Optimizer, and using only the last 3 months makes optimization a far less time consuming exercise. Yesterday I provided my own recommendations on which Strategies and Filters I felt were the most worthy of attention.

I also found a similar problem about the trailing stop. The EA is supposed to start the trail based on my setup when the price moved in my favor. But it didn't. Only after I realized this and restarted the MT4 and then the EA started to trail and typically closed my winning orders immediately after I re-logged in. But I could earn more pips if the EA started to trail earlier. I used the same broker as yours. Hopefully, you can find a solution to this. Thanks.

hello
is there anyone with a +/-optimized set file to test eurusd?
my results with this EA are not good

very sorry dave, probably I did not understand something about trailing stop...
My expectation was that the trailing stop move in my favor (it's a sell order) of 5 pips starting from 1.5854 - SL (100pips) = 1.5754... so new SL = lastSL + 5 pips
... is it correct?


I can confirm, just restarting MT4 platform I have a strange behaviour, looks the EA's messagges. Big Problem to fix!

The problem lies with the restart. When you restart MT4, all variable values within an EA are lost.

On restart, the EA sees that you have passed your break even level and therefore sets your stop loss to breakeven and records the Profit Level at that point in time. Only after the profit level at that point in time has increased by 5%, will the stop loss be updated (because it looks at the profit level when the breakeven adjustment is actually made, which is the time of the restart).

I have added some extra code in an attempt to recover the value of the lost variables and added the update to the download area.

Todays Discussion: (Refer Post #1301)

How to Handle Money Management:

The tools at your disposal give you many options to consider. The more of the following tools that you use and optimize, the greater the increase in Profit Factor.

1. Trailing Stop Loss - always recommended
2. Stop Loss - Must have
3. Stop Loss Multiplier - recommended
4. Stop Loss based on Average True Range (not recommended)
5. Take Profit - recommended
6. Take Profit Multiplier - recommended
7. Take Profit based on Average True Range (not recommended)
8. Set Stop Loss to Break Even - recommended
9. Minimum Pip Gain - recommended
10. Decrease Stop Loss Percentage - recommended

As a minimum - Stop Loss, Stop Loss Multiple and Take Profit Multiple should be optimized and the last 3 also if possible. The hardest part of Forex trading is dealing with the emotional factors and that is where the EA excels. Your 2 enemies are greed and fear. Whilst an EA can handle Money Maqnagement on a per chart basis, you need to take stock of the big picture.

As a current example, the chart at the top of the page reflects the 7 major currencies trading the same strategy with different variables on each chart. If you look at the 2 current trades, the lot sizes are different according as to where the betting progression is situated on those pairs. The EA has an inbuilt safety barrier of a maximum of 20% of equity lot size after which the lot size reverts to the original percentage of equity. Two days ago, one of the wagers was up around the maximum and one large trade recouped a big slice of the current drawdown. That is the Stop Loss Multiple in action. It can work against you also and hence the large drawdown.

The point is that, in a live trading account, you should never allow such a significant drawdown on your equity (recommend a maximum of 30% overall) and I have enclosed the CloseTrades EA which allows you to automatically monitor your total equity on an account and shut down all EA's at a particular nominated level. In the past, I have lobied the idea of taking a percentage of profit at different levels in the profit cycle but have settled on a method of progressively decreasing the stop loss as the trade progresses.

The concept of small Take Profits with large Stop Losses is not a proven effective money management principal. The Take Profit Multiplier can be used to set the Take Profit as a multiple of Stop Loss but I would not recommend a value of less than 1. At any rate this figure should be optimized and the default settings are from 1 to 2.5 but you can change those boundaries if required.

In summary, this is the area you should really be paying most attention in your trading endeavours. The more trades you make the greater the trading costs and you will find that once your trading costs are up around 20% of your profit, you should be examining your trading style. Just keep in mind the conventional returns on investment rarely consistently return more than 10% annually on a consistant basis, so even if you are only making 1% per month on a compounding basis you are far ahead of most investors. Don't think for one moment that you can average anything like 20% per month. It's the total position that counts and looking at the big picture on your trading is far more important than those 100% gains.

looks working now! dave... GREAT!!!!

Today's Discussion: (Refer Post #1301)

Finally - A Battle Plan!

This brings to an end the series of discussions started in Post 1301 and it would have been great to jump to this point to simply put everything together.

Most importantly, Traders Gift EA is a toolbox to test and back test trading ideas. Strategy Optimizer makes optimizations simple and gives you the ability to refine the inputs to successfully use Auto Trading. Don't forget that you can use Traders Gift EA in the advisory or discretionary mode. This takes the hard work out of scanning the market looking for trading ideas because the alerts happen in real time.

Whilst trading opportunities appear, it is not always certain which way the market will move and always remember that momentum will drive the market even if the direction does not seem logical. It is very timely that this discussion ends today because there is looming, the greatest shake up that the currency market will ever experience with the potential bankruptcy of Greece.

Plan to make use of Straddle Trades more often, be aware of all Support and Resistance levels and always look at the big picture. That is the Daily charts. Unless you are scalping the market, avoid trading on shorter timeframes (less than 1 hour). To use Traders Gift effectively, you need to set up a VPS and run up to 4 instances of MT4 on each VPS. On a monthly basis, redo your optimizations on the last 3 months data and run them on a demo account for at least 2 weeks and then pick the eyes out of the successful sets in combination with the successful currencies. Keep you investments on each set at a minimum. Even use 1% of equity and watch for non performers in live trading and don't persist with them. If you can make 5% consistently each month you are on your way to becoming a successful trader.

Be very aware of News Releases even with a view of not trading at all around major releases because the market can whipsaw violently taking out Stop Losses. There will be trading opportunities everywhere in the next couple of weeks but do not be in a hurry when the market starts moving. Beware of false signals! The Banks prey on impulsive traders and what seems blatantly obvious can be easy pickings for the bigger traders. Get to understand fully the Commitment of Traders releases and make sure you are always fully aware of pending news releases.

Obviously my biggest and final idea is to manage your money. That means keeping good records of your trades, what worked and what didn't along with relevant comments. There are millions of trading ideas and always keep an open mind. Forex Factory is a respected source of free information and remember to read the commercial threads as many offerings are still free.

I have no connection with this site whatsoever but I do highly recommend it for free trading systems. What I would suggest is that you review the systems and create a database of the ideas which appeal to you and see if you can incorporate them into Traders Gift. Particularly read the section on "How I saved a million in 1 year".

http://forex-strategies-revealed.com/

I have waived the copyright on Traders Gift EA and the source code is yours to modify however you like.

Great Work David, will try to build a PDF file with all those important subjects.

Regards.

Enclosed is the full compilation of the Daily Discussions with a Table of Contents.

Perfect.

Data update to end of June is now available here.

Thanks for your work. I will download and re-optimize my strategy.

Dave_C, what do you think of using ZeroLag MACD instead of MACD?

I generally don't trade the shorter time frames and MACD is not one of my favoured indicators.

I had a genius idea while I was in bed contemplating life last night. This idea may be stupid actually.

You know how you can optimize for 1 currency, then you save set file, then you optimize second, save that set file. Those two set files based on back testing gave you nice results. What if you could combine those two set files in 1 back test.
As in,
Pick currency 1: EURUSD and pick it's set file
Pick currency 2: USDJPY and pick it's set file
Pick currency 3: GBPUSD and pick it's set file

Run backtest on all 3 at the same time and see what happens to the equity. Usually, if you're running 1 pair back test, it is pushing nice results, and second one is bringing your equity down. You gotta do math in your head, which I hate.

Anyway, that was one of my bed time ideas. I usually forget all by the morning, but this one stuck around.

That is why I offer Strategy Optimizer Auto and the 168 Optimizations running concurrently on 14 accounts.

Each currency pair has its own data file so there is no point in back testing simultaneously, you need to forward test with a VPS.

Just added zelo lag maccd and fisher m11 indicator's to your EA.
Dave_C, question: Is there a way to pause tradding (pause the EA) after a successful trade?

If you have been able to make your own adjustments, you are welcome to add your own pauses.