Round Number Trap!

[Alpenkorps]

Hi Guys,
I was working on an anti-martingale based grid system which in the end doesn't look so good on long term. Recently I applied a new variation. Backtest result was sound enough to convince me to try this on live. I am live for two days now (Just to test it on live feed) and here I am!

Purpose of this thread:
* Share the idea with you, get your comments on possible refining.
* See if we can get Steve/George/Mike or any other coder interested.

Round Numbers
Numbers like xx00 every 100 pips, Example on EU = 1.2800, 1.2900, 1.3000 etc.

The Trap
* Price touch a round number
* Place a buy stop and a sell stop order 10 pips away from the round number with same lot size, Take profit and Stop loss is 20 pips.
* If any of them gets triggered, delete the other one, place another with double the lot size.
* Keep doing this until Take profit hit, after that, delete the remaining pending order.

The Logic
Round numbers are very important, in my personal opinion, they are more important than pivots! A lot of actions happen around those numbers. Not just retail traders, Banks, Funds place their order/stops/profit target around these levels. So these round numbers become very strong support and resistance. When PA reach them, it will either get bounced or pass through it (well most of the time). I am willing to bet on the fact that, Price will not range keeping these level in the middle for a very long time, and the possibility for at least a 30 pip move on any side is very very high.

Money Management
If 1 pip = 10 cent, then the trading account must have at least 300 Dollars to stand up to level 7. I am yet to see a level 7 but we must prepare for the unseen.

Trading Time
The system is good for 24/7. But no matter which system, I don't like trading between London close and Tokyo open. And it will be best not to trade this one before NFP and on Bank holidays (when market is expected to be awfully slow).

Pairs
Seems good on EU and AU. Other pairs are yet to be tested.

Live Test result
I'll post my results as a reply to this post, while I am writing this, I am in another trade (PA crossed EU at 1.2800), I'll wait for this to complete.

Note for the Coder
* Margin check
* Adding the TP and SL after PO gets triggered, because of the slippage.
* User defined TP, SL and lot multiplier
* Option to trade mid 50 levels (1.2850, 1.2950) just to check on backtest.

Thats it guys, all inputs are welcome (I know the martingale haters will starts cursing me sooner or later).
Thank you for your time

[Alpenkorps]

This is the last trade I took.
Buy Stop @ 1.2810 TP 1.2830 SL 1.2790
Sell Stop @ 1.2790 TP 1.2770 SL 1.2810
Trade went up to level 2. Damn Criminal gave me a 4 pip slippage on a Pending order!!

[Alpenkorps]

Here is all the trades I took on EU from Yesterday.

[Alpenkorps]

Just caught another one! See how price bounced from the round number. This is pure entertainment

[magft]

If no one else is making an attempt at this i'll see what i can do later on, looks promising and not too complex

Regards

Mike

[Alpenkorps]

If no one else is making an attempt at this i'll see what i can do later on, looks promising and not too complex

Regards

Mike

Thank you Mike, Thats very kind of you.

[magft]

I have been working on this last night and this morning, it looked simple on the out set

The problem i have had is monitoring the two orders simultaneously so if one is hit the other has lot size increased or is deleted on TP hit. This OCO is complicated, i thought i could use Graeme EA and adapt but that was too complex!

I have a stripped down version with no of Steve's fancy stuff in that almost works so i will set up a new thread probably tonight once i am happy it trades as expected.

I'll keep you posted.

Mike

[Alpenkorps]

Great Mike, Cant wait
We don't need the fancy stuff, simple thing will do.
About the problem, once a coder suggested me to continuously check order type in a loop to figure out when its changed so we can act upon it. There are a few example on mql forum.

[magft]

Just want to check something as i may be over complicating it!

The Trap
* Price touch a round number
* Place a buy stop and a sell stop order 10 pips away from the round number with same lot size, Take profit and Stop loss is 20 pips.
* If any of them gets triggered, delete the other one, place another with double the lot size.
* Keep doing this until Take profit hit, after that, delete the remaining pending order.

For this point

* If any of them gets triggered, delete the other one, place another with double the lot size.

should we have one open trade and one pending trade? Then if Open trade hits SL we open another pending trade at same price as the one that just hit SL giving us two pending trades?

Mike

[Alpenkorps]

should we have one open trade and one pending trade? Then if Open trade hits SL we open another pending trade at same price as the one that just hit SL giving us two pending trades?

Mike

If an open trade hits SL, remaining pending order gets triggered at the same point (imagining there is no slippage). So theoretically there won't be two PO at the same time. But eventually broker will give slippage and we will see two PO. Please see the entry-TP-SL on the first example I have provided.

In a slippage free world (lets say a wonderland)
Buy stops SL = Sell stops Entry
Sell stops SL = Buy stops Entry

Steve coded an EA long time ago, with the same recovery logic. Here is the link if you are interested.

Thank You.