FREE FOREX STRATEGIES

Forex trading strategy #13 (Trending pairs breakout grid system)


Trending pairs breakout grid system from Claus

-------------------------------------------------------------------------------

I choose the most violent pair, GBP/USD. I put stop loss orders above and
below the current price at an interval of 20 pips again. Current price is
about 1.7800 so here is the grid:

buy stop 1.7820 1.7840 1.7860 1.7880 1.7900 1.7920 1.7940
sell stop 1.7780 1.7760 1.7740 1.7720 1.7700 1.7680 1.7660

Eventually the market will go far from the current price, towards either
north or south. If I have more than 2.45 times buys than sells or more than
2.45 times sells than buys, the grid is is profit. Since the orders are
canceling their opposites, margin is a very small issue here. Lost capital
is also small. Obviously, if you set the grid just before London opening
you have a very small probability to have to wait for a few days until you
are in profit.

Suggestions and feedback is welcome. Thanks.

Claus

Thanks Claus, your contribution is greatly appreciated!

Edward Revy,
http://forex-strategies-revealed.com/

Copyright © Forex Strategies Revealed

hi please explain 40 pips loss if all 14 position is hit. I am newbie in forex please help. what if level 2 is hit for both buystop and sellstop. I think it's not 40 pips anymore.

Any strategy which turns a $500 account into $2000 in 3 days is destined for a margin call sooner or later.

Jabran

hi Clause do you still use this strategy?

i have been develop an EA using all of this information, i trade the NFP today and have a 300 pips. this kind of strategy is good when you know use the correct time of the day or the correct news event.

please tell me if you use it at this momet?

my mail [email protected]

regards

I had an Expert Advisor I ran on a demo account exactly the same concept as this.

It took $500 and turned it into $2000 in 3 days. On Day 4 there was a margin call and then the account was history.

So Claus you need to refine this a little better my friend. As the gentleman above have said - you will eventually accumulate big losses that can't be saved.

Hello Claus!
You just mirrored my own strategy))
http://ruforum.mt5.com/threads/7278-grid-trading-reactive
I called it GRID TRADIND REACTIVE because it reacts to market moove and adopts.
I understand that it is your idea and I also did not invented this aproach.

Do you still use it to trade?

Hi Everyone,

Despite some of the comments claim that this is a martingale strategy, I do not think so. If I understood it correctly, your positions will eventually go positive. The worst case senario is that both long and short positions trigger. In this case you will suffer only 40 pips loss.

FaceReality says that you may suffer 120, 180 or even 400 pips of loss but since there is no stoploss or takeprofits and if you wait the market decide its way eventually the positions will go to profit or 40 pips loss. And of course a little more from daily swaps if you have to wait too much.

From this point of view this strategy seems logical and profitable.

Regards,
Erkanus

Call rather this strategy....a hedged straddles grid strategy ; this is the correct name . I consistently use it with incredible sucess ; the most important is to go to sleep with your ongoing positions ABSOLUTELY HEDGED ( same volume sell & buy in your ongoing positions ) so you probably get a handsome profit waiting for you when you switch again your computer ; when you are ready to trade , you always let more volume in bought or sold positions according to the trend ; for example, you can leave 3 LONGS with 1 SHORT when the trend is up , your ENTITY will be growing with the upside, even if you trail a 1 SHORT losing position , you gradually change the volume so as you have same volume if the market ranges & is choppy, or you add more SHORTS than LONGS if down trend.
At one point,you have closed your positions SHORT or LONG with profit , then it is up to you to see the reversal point ( just watch for the moving average to be crossed by the trend line , up or down ) then your losing positions should diminish , trailing them carefully.
My personal maths = 7 pips take profit each straddle with 3 pips interval between straddles, and most important , NO TAKE PROFIT in the most distant straddles , both buy & sell pending orders.
JR LEIGNEL [email protected]

The grid should be reset manually. You'll need to delete every line and order.
When you reset the grid, you just start all over again following the rules of the strategy...

Thomas

Hi.

I have a question. Can somebody explain to me how to reset the grid in a very detail?

Thank you.

Hi,

It should be read as:

"Buy stop" and "Sell stop" accordingly.
Buy stop is a pending order for a Long position (Buy position).
Sell Stop is a pending order for a Short position (Sell position).

So, there you place next pending Buy orders (called "Buy stop" in your trading platform):
at 1.7820, at 1.7840 and so forth.
Same for the pending Sell orders:
at 1.7780, at 1.7760 and so forth.

When you finish, you have a grid of pending Buy and Sell orders on your chart which are waiting to be triggered by the market price.

Best regards,
Edward

Hi. I read the strategy and got confused. I really need help and someone to explain to me.
What do you mean: buy stop loss 1.7820 1.7840 1.7860 1.7880 1.7900 1.7920 1.7940
sell stop loss 1.7780 1.7760 1.7740 1.7720 1.7700 1.7680 1.7660

How do I have to place an order on the trading platform? Please explain in detail.

Thank you.

I had tried a similar system of ordering, but not for such a large grid. It worked satisfactorily. My TP pips were limited to the spread (2 or 3 pips, max 5) and this works safely.
Mohan

thank you!

I came up with this exact same idea a week or so ago and haven't put it to use yet. The thing I would suggest different from your description is to trail stop orders behind open positions at your 20 pip levels. That way as one trade is at +20 a new trade is entered with a 20 pip stop-loss, so the positions are guaranteed b.e. and -20 if price reverses. After a sustained move of 60 pips in one direction your guaranteed a profit of +20 without any other trade management. By adding Bollinger-Bands or some other over-bought/sold indicator it would be possible to scale out of positions to help maximize profits.
In a consolidating market it would be possible to achieve profits by reversing from stop orders to limit orders, i.e. buying as prices fall and selling as prices rise. Its a lot riskier but for someone comfortable trading chop it might be worth trying.

you have your point, Claus.. but I'm afraid I have to agree with FaceReality.


Post new comment

CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.
Image CAPTCHA
Enter the characters shown in the image without spaces.