Price Action Strategy question.

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Hi all! I am watching my mt4 terminal charts and notice that sometimes there are these "spikes" in price. Surely a coder in the mql4 forum has created a strategy to "capture" these profits when the price spikes very high/low, very quickly. These spikes must be created by traders placing buy/sell orders in the market therefore creating short and quick acceleration in volatility.

If anyone in the mql4 community has created a successful strategy that captures these spikes, feel free to message me your thoughts if you wish. I wish to write a strategy that will capture these spikes in price. I believe that I have the coding skills but lack the strategy logic to complete the task. I am almost 99% sure that a coder in the mql4 community has created such a strategy.

Thank you.
 

A spike is only a spike if the price does not continue in that direction, how do you know if it will or not ?

 

Honestly, I don't believe that it matters if the price continues or retraces. The strategy would most likely require a trailing stop of some sort to catch the accelerated price movement.

If it matters to you, I suppose the answer I will reply with is that I do not know. Apologies & thank you for your post.

 
The problem is that at times when spikes and large amounts of trading are taking place the freezlevel is increased along with the spread making it difficult to actually get your trade placed and then how to determine the the exit pon't of fast moving trades - the price can go up and return very quickly.
 

@Ickyrus: BUT :), what if pending orders were used AND "Spread Control" functions were in place? Wouldn't this solve the problem of not being able to get in the market because of freeze level?

Thank you.

 

Ok I will be the Muggle for now - How do you know when/where to place the pending order? Very fast ups and downs will close most close trailing stops very quickly

 
@Ickyrus: Ha-ha. (laughing at your "Muggle" comment) sigh... Ok, I suppose the pending order would be at support/resistance levels & I do not know when price will spike up/down, BUT, I would think that being prepared for if it happens, to be ready for order launch. Just my 2 cents. I have some thoughts but nothing more/less. Also, I look at USD/JPY and sometimes "betsy" (price) will shoot through the roof and then come back down OR even fall really fast AFTER price just shot through the roof!
 

You mean when a bank or big player stop hunts just before price heads in the opposite direction. The financial insitution knows it needs a pool of money to balance the large change of price, who can blame them thats what they have to do to make things balance.

You are probably better off just sticking to a trend retracement system. Making sure that your risk/reward ratio is at least 1:1 and keeps to a range of money available to trade that risk

 
Yeah, maybe so. Typically when manually trading, if I look at my charts and see a setup screaming "retracement" and the range/trend size covers the spread of the currency pair being traded, I'll hop in the market if all foreseeable possible probabilities are in my favor. I recollect you stating in another post that it takes consistency to be successful. I couldn't agree more and with that being the case, this is where expert advisors step in, ready to crunch numbers for an eternity. Haha. ;)
 
What I cant do is get the computer to look left and decide how major or minor the Support / Resistance levels are at that decision point to trade.
 

Perhaps I'll swim deeper towards my objective and write that I am aware that there can be a lack of data being provided by some MT4 terminals. This lack of data that I am speaking of is sometimes referred to as "Level 2 data". Level 1 data is openly available in the MT4 terminal, BUT ;) Level 2 data is sometimes excluded which can severely decreases probability of placing profitable trades. I suppose that what I am asking is if anyone in the mql4 community is familiar with level 2 data and has had previous experience using it successfully. I wish to build a manual or automatic strategy that uses level 1 and level 2 data. If you are not familiar with level 2 data, it is simply data showing the current power of bulls vs. bears aka "order book".

Thank you.

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