I gave it some thoughts as well, and have some ideas.
No clue if it can be automated at all, I can't code even if my life would depend on it.
[I would learn how to then
]
There are several possibilities, taking the standard setting of a grid spaced at 1/10ADR and 1/2ADR TP;
- price goes one way, triggers 3 and TP
- price goes one way, triggers 1 and reverses. Needs 5 countertrades to TP
- price goes one way, triggers 2 and reverses. Needs 7 countertrades to TP
- price does several of the above, weaving a DD-web
When taking a 200pip ADR for example; what if we;
- set for the first trade a SL at the DO, and add the lost pips to the TP when triggered. The loss will be 20 pips. When price takes off after SL, TP will be 100+20=120. Price needs to travel an additional 7 pips [the lost 20/ 3 trades] to TP. It takes less than half a level to accomplish this instead of 2 levels in the current situation.
- set for the first 2 trades a SL at the DO, and add the lost pips to the TP when triggered. The loss will be 20+40=60 pips. When price takes off after the SL, TP will be 100+60=160. Price needs to travel an additional 20 pips [the lost 60/ 3 trades] to TP. It takes just 1 extra level to accomplish this instead of 4 in the current situation.
- set BE when 3 trades in the same direction are triggered. BE will be on the 2nd trade, a whole level away. Price either goes to TP within the next level or the trades close at BE.
Doing it this way avoids huge baskets of hedged trades, and makes it easier for the basket to reach TP.
What to do after BE is triggered, I'm not sure.
Maybe just quit the pair for the day and rely on the straight runners to do the heavy lifting.
Whatever happens, we will never have hedged trades anymore.
Of course there are scenario's where any pair can throw a curveball, but what do you guys and galls think about the general idea?
