How to select your first initial trade - MQL4 and MetaTrader 4

ZTrader 2006.11.15 05:11 #281

After more research and some careful thought, I have begun to wonder if there's really much point in worrying about the method used to select the initial trade. Terminator is loaded with indicators to choose from, each one providing a different option for the selection of trades outside of the counter-trend progression. I believe that this focus on indicators to select this initial trade is counter-productive, as it distracts from the most important fundamental aspects of this system.

The strength of this type of system is that it can make money no matter which way you trade and no matter which way the market moves. In this respect, it's a constant profit machine without regard to initial trade decisions. In addition, the best profits come from a counter-trend progression of at least 4 positions deep, so it's actually better to choose "bad" initial trades than good ones. Based on this analysis, I've come to the conclusions that A) initial trades should be made without bothering to consult indicators, and B) the system should always be in the market because the sooner the progression starts, the sooner it becomes profitable. I.E., you can't make money if you're not trading, so the system should place a new initial trade as soon as the previous progression is closed out.

The other side of this is the primary weakness of the system, which is vulnerability to large, continuous market movements. This is, to my way of thinking, the most important area to be developed, and should be the primary focus of our research. This is why I say that trying different indicators for initial trade selection is a distraction. Until the progression can be made (relatively) safe, nothing else matters.

My latest experiments involve a version I've created which has the following differences from the mainstream Terminator:

Initial trades are made immediately when the previous progression closes and only in the direction of positive swap.
StopLoss, TakeProfit, TrailingStop and MaxTrades have been removed.
A progression is ended when a specific profit amount has been achieved.
The amount of profit targeted is scaled down to breakeven by the time that the progression reaches a depth of 10 positions.

I've found in my initial tests that this simpler strategy is quite effective at making money, and my most recent experiment has shown that reducing the Pips value (pip step) from 20 to 10 has made it even more profitable. I won't be sure how much safer (if any) this concept is until I write an independent backtest modeler (I don't trust the MT4 back tester) and perform some in-depth studies. That's where the real optimization will take place.

MasterMartingale v1 --- a Taking Neural Networks to CounterStrike Trading Method... 100%

rarango 2006.11.15 12:12 #282

Hi Ztrader,

I agree with most of what you say. However, reducing pip value tends to increase profits but it also increases risk. I think that the best would be to have some sort of adjustable pip value based on market conditions.

I still think that increasing pip value as more trades go on could help. Back testing shows that for pairs with big price movements a higher pip value is safer.

Your idea of closing trades based on total profit is interesting.

Can you post your modified ea for testing?

PivotMagic EA: Magical power _rdb_The Best Free EA Question on Hedging

munis6823 2006.11.15 19:20 #283

Great EA

Hi,

I'm going to forward test as well. Do i need to change the timezone?

I'm using Interbank Fx as my broker.

Will update my statement once a week.

Thanks

munis6823 2006.11.17 18:46 #284

How does the trailing Stop?

Hi,

How does the trailing stop for the EA works?

Market reverse position upto 60 pips but didnt get stop out with 20 pips of trailing stop.

Hope someone can look at it.

Thanks

tmaneval 2006.11.17 21:44 #285

Statements

Statements w/e 17 Nov 2006

tom

Files:

2006-11-17_all_detailed_by_symbol.gif 6 kb

2006-11-17_all_detailed_by_symbol.htm 757 kb

2006-11-17_this_month_by_symbol.htm 84 kb

2006-11-17_weekly_by_symbol.htm 43 kb

munis6823 2006.11.18 03:55 #286

Statement

Hi,

This is my statement for the week.

It was fine, except for the last floating orders

Thanks

Files:

statement_3.htm 9 kb

tmaneval 2006.11.18 04:27 #287

munis6823:
Hi,

This is my statement for the week.

It was fine, except for the last floating orders

Thanks

The account is overleveraged. An updated readme file has been added to the zip file in post #1 which may be helpful.

tom

kjenkins 2006.11.18 21:48 #288

Update

My weekly update has such a pretty graph.

I need to pose a question; When looking at the 'detailed statement' we need to really note the "profit factor" and the "expected payoff". These are important numbers. This is my thinking. If you start with 10k, the profit factor is the rate of profit based on the deposit amount at the time a report is made but I'm not sure how the PF is calculated. The Expected Return (and this is meant to be in question form) is a number telling you when (in an amount of time) you would pay off the 10k? But if it's in an amount of time, then does it represent weeks or what? I've noticed that a PF of 2 or more results in around a 4 for ER. I would think that the greater the PF then the smaller ER would be needed. Looking forward to you guys' thoughts on this. Thanks and have a good weekend all. Kevin

Files:

terminator_1.zip 20 kb

Backtest not showing profit Importance of profit factor Econometrics: let's discuss the

mrtrader 2006.11.18 23:00 #289

kjenkins:
My weekly update has such a pretty graph. I need to pose a question; When looking at the 'detailed statement' we need to really note the "profit factor" and the "expected payoff". These are important numbers. This is my thinking. If you start with 10k, the profit factor is the rate of profit based on the deposit amount at the time a report is made but I'm not sure how the PF is calculated. The Expected Return (and this is meant to be in question form) is a number telling you when (in an amount of time) you would pay off the 10k? But if it's in an amount of time, then does it represent weeks or what? I've noticed that a PF of 2 or more results in around a 4 for ER. I would think that the greater the PF then the smaller ER would be needed. Looking forward to you guys' thoughts on this. Thanks and have a good weekend all. Kevin

Kevin,

Very good that u talk about that... i also don´t realy know what te two numbers exactly meaning... Does somebody know it ??

Thank you !

BTW, please look also this thread, maybe we can find some usefull there...CLICK HERE !!

mr.trader

Converting EAs to MQL5 EAs and real accounts Is it possible to

hades291 2006.11.19 03:28 #290

munis6823:
Hi,

This is my statement for the week.

It was fine, except for the last floating orders

Thanks

Tom has mentioned the leverages and equity to be used accordingly in previous posts, i'll post it again below.

For the newcomers to the thread here, please don't take this the wrong way....BUT many of the information you seek/need is found in previous posts in this thread.

If you are to make money from this you have to take it seriously, which means doing ALL your homework. IF YOU were to invest money elsewhere, like buying a house or whatever else(this is a rough example most of us go through), you would naturally do all your preparations and homework. In the case at hand please read all the previous posts here. This EA can, will & DOES make money if you do everything right. Read thoughout this thread and you will find lots of interesting events in here.

I Hope this doesn't sound too harsh but, you have to treat it like a business...DO YOUR REASEARCH.

tmaneval:
I don't know what all your settings were but I DO know $500 is insufficient capital for this EA.

The past couple of weeks have also been tough. That's good. We'll see how this EA and settings perform.

Below is a guideline only for testing setup:

1. $100k works at 1:400 leverage as on the demo account I've been posting trading 0.1 lots.(mini lots) This would equal 2 below.

2. $200k at 1:200 leverage trading 0.1 lots. (mini lots) Equals 3 below.

3. $20k at 1:200 leverage trading 0.01 (micro lots)

4. $2k at 1:200 leverage trading 0.001 (nano lots)

The above of course is not the only way to go about it and is not guaranteed. It is a starting guideline for initial testing. Any method employed should be tested and demoed thoroughly.

Please demo it with at least 1:200 leverage or use more capital.

Take your time with your own testing under an exact scenario that you might use to trade with - including the broker, settings, and currency pairs used. This way you will gain your own level of certainty and confidence and gain knowledge of the EA's behavior and margin usage. The basic concept here is 'Know BEFORE you go'. You can only KNOW with YOUR OWN testing and experience.

Real Estate has a keyword, 'Location, Location, Location'. If I were to assign a keyword to using this EA it would be 'Underleverage, Underleverage, Underleverage'. Underleverage applies to the amount of margin used to stay in the game. Deep pockets and high leverage - as stated in the readme file - is needed to stay in the game during trending markets. Even then, there are no guarantees, but NOT doing so increases the risk. This is part of the account setup or playing field you will be engaged in.

Please don't ask if such and such amount of money is sufficient to do such and such on a live account. I don't give that advice. That decision is entirely yours and hopefully you reach that after sufficient (months) forward testing on a demo account.

Hope this helps.

tom

Sorry if came across a bit harsh, but seeing quite a few newcomers here asking questions or making remarks which can be answered, or solutions found in previous posts.

Regards,

hades291

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Terminator v2.0 - page 29