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Scalping strategies and methods

Boris F — Wed, 04 Apr 2012 03:37:56 GMT

What is Internet trading?

Technically Internet trading is a process of trading or an act of purchase and sale on the financial Forex market over the Internet. Some Internet traders who trade Forex compare trading with hunting and see themselves as wild animals. Others describe trading as like being a ship in a violent storm at sea. Some even see trading as a lucky fountain where people throw in coins and make a wish. Forex trading using a scalping strategy is more like the lucky fountain full of coins.

On the face of it, you would think that simply gathering up the coins from the bottom of the fountain is easy and risk-free. But the bottom is slippery and you can easily slip over and scatter all the coins. This strategy represents the generation of profit from Forex market transactions, which sometimes last less than several minutes. So, unlike Internet traders, who operate with large amounts of money and are ready to wait for a long time to make a profit, traders using scalping strategies make money on a large number of small transactions.

To use a scalping strategy successfully, it is very important to learn how to exit a transaction with minimal losses.

Here we will consider three trading approaches which use a scalping strategy to make profit. They are:

• Play on Time, Trade against a Trend and Trade along a Trend.
• Play on Time
• This category has a number of variants to it.

The first method is known as the 15-minute opening range breakout. The distinctive feature of this method is that profit is taken very quickly and a transaction rarely lasts longer than one minute. The method used here is to wait for a breakout to form and then enter the market a couple of ticks higher than maximum or a couple of ticks lower than minimum. Having made one point profit, you should close your position.

The next method can be called “shake-up at 10 o’clock”. This is based on New York time, where an attempt to reverse trend occurs at that time. You wait for the first 15-minute bar to close and watch. If the market is near the day maximum within the first half an hour, you should be ready to open a short position and vice versa : i.e. the market is near the day minimum then you should open a long position. You enter one tick after the maximum of the last 15-minute bar at short positions and one tick after the minimum at long positions. Having made a one and a half point profit, you exit.

The final variant is called “shake-up at 1500”, again, New York time. Here you should buy if the Forex market was moving down for half an hour before 3pm and sell if the Forex market was moving up. The exit rules are similar to the previous methods. Cancel all orders in half an hour.

Trade against a Trend

A method of trading against a trend is known as a “cents collector”. To do this you examine candle charts to find bullish and bearish “swallowed” candles. This strategy allows you to perform transactions only in the first and the last hours of trade. As soon as you make a one point profit, you should exit.

Trade along a Trend

There are various methods when trading along a trend. The first one is known as forex scalping with standard deviation. This approach suggests a re-entry into the Forex market at pullback, i.e. you should enter the market only at major pullbacks. In case of an ascending trend you should buy on pullbacks down, and if there is a descending trend, you should sell on pullbacks up. While working with this method it is better to use a 10-minute candle chart and a moving average with period 10, putting them one above another. Having made two points profit, you should close the position.

The next Trade along a Trend method we will look at is called the “anti” method.

To do this you need a 5-minute candle chart on which you should use the slow stochastic with a period of 7 and its moving average with period 10. When the stochastic crosses the moving average above at the close of any 5-minute period, you should buy and vice versa. Again, having made two points profit, you close the positions. Repeated entries are not recommended in this strategy. We’ve briefly described several forex scalping strategies in this article. Internet traders, who use these approaches should act quickly and resolutely. But you should be prepared for losses and understand that a scalping strategy doesn’t bring large profit instantly. You will gather your profit slowly, but each earned cent will give you priceless experience of trading on the Forex market. As a result, your Internet trading skills will be sharpening. Don’t forget that there is no such thing as easy money and it takes effort and patience to make large profits!

Why 95% of novice traders lose their money within 1 year

Boris F — Fri, 23 Mar 2012 13:56:04 GMT

It’s well known that 95% of novice traders lose their money within 1 year. But is this actually true and if it is, why is this happening? I believe it is true. And here’s why.More than 95% of novice traders with small initial deposits lose their money. Note that I’m making reference to “small initial deposits”. The greater size of the initial capital the less likely you are to lose money and vice versa. So, if you have an account of less than $1000, it’s very likely you will lose this money. In fact, there’s a 97% chance it will all be gone within the first 3 months.

But if your account is $50,000 or more, then you are more likely to make money trading on the forex market.
This presentation isn’t saying that you should open an account with a large sum of money but it will show you how you can make money on the forex market starting with a small initial deposit. Before we can do that, we need to understand why traders with large accounts are more likely to earn in the forex market.

The 3 most important reasons are:

1.      Brokers provide better conditions: spread, execution time, no dealing desk
2.      Traders with larger accounts will usually deal in lots that make up a smaller percentage of their overall deposit; about 1-2 %. Whereas traders with smaller accounts trade with lot sizes that account for about 10-20 % of their deposit.
3.      Traders have access to more information - forex analytics, etc.

Ok. So how can you start trading and be successful with a deposit of $5000 or more?

First of all you should set up with a real ECN brokerage company.
Do not expect that the broker will bring your orders to the interbank, because banks and institutional brokers have a lot minimum of 1. But a lot of brokers have their own price aggregators and they will allow you to trade with lot of 0.1 without manual intervention. But don’t just choose any broker and be wary of online reviews as they are usually created to advertise a particular brokerage company that may not be the most reliable.

Second - Money management.
You should not risk more than 5%. Actually I would recommend 1 – 2%.For example if you have a current account balance of $10,000 and the expert advisor can open 3 orders simultaneously, your order size should be 10 000 x 5% / 3 orders = 166 = 0.17 lot I’d also recommend not using any Martingale strategies or trading without stop loss.

Third - Information and Knowledge
There is a saying that if you have never worked the lathe and you try to carve detail, you’re very likely (about 97% likely!) to damage your fingers. Similarly, the forex market punishes inexperienced traders.It usually takes about 3 -5 years to develop your own profitable strategies and become successful in the forex market.You can lose a lot in this time including your enthusiasm for trading and thousands of dollars.

So this is why I would recommend that you find and buy a good stable, forex robot and start earning money within a couple of hours.

This does not prevent you from simultaneously developing your own method of forex trading.

As a guide, the Forex Robot should be tested on real accounts for at least 1 year. You should also check how the robot trades in both flat and trend market conditions. As with broker reviews, don’t always trust the online forex robot reviews or ratings, as they are also usually only advertising a specific forex robot, which won’t always be the most reliable.
What you should trust are time-tested forex strategies, developers and real account proofs. So with this in mind, I would recommend the expert advisor TFOT. You can find more information about this robot here: http://iticsoftware.com/fxrobot-tfot

2011 @ BJF Trading Group inc. http://iticsoftware.com

execution speed

Boris F — Fri, 23 Mar 2012 02:35:01 GMT

Are you a Forex Trader, Forex Money Manager or Forex Signal Provider? If so, have you ever thought about how much execution speed matters? And how often does the speed of executing really make a difference?

As an example, let’s look at fast market conditions during a period of economic news: In a fast market, there can be up to 250 price changes per minute. This means that the market can move four ticks in one second. So for an average price of a EUR/USD currency pair there will be changes of 2 pips per second.

In this scenario a 1 second delay leads to a loss of about 200 USD on each standard lot. If you open 5 orders per day you can lose 200 x 5 = 1000 USD per day.

Execution speed makes a difference in another way as well. We all know that there is an edge to being first in the queue because the sooner a trader places an order, the more likely the order will be filled when the market touches that level. Also, do you know where your orders will be resting if there are Internet connectivity problems?

So the main factors affecting the speed of execution:
- Trading terminal delay
- Internet connection delay
- Broker execution time

If you use a MetaTrader 4 terminal, delays will occur at each stage of the transaction. Specifically there will be delays from using MT4 itself, plus the delay as information travels across the internet and the time it takes for the trade to be executed by the broker:
MT4 delay = 600 milliseconds
Internet connection delay = about 100 milliseconds
Broker execution time = about 200 milliseconds

And if you use two or more Expert Advisors, this can increase the delay as MT4 only has one flow, so when the first Expert Advisor sends an order, the other expert advisors wait.

How can you reduce this latency?

First, open an account with Real ECN Brokerage Company with stream quotes. Then find a virtual server near the broker’s server with a fast internet connection. You can then ping the broker’s server from the VPS.
If you use two or more expert advisors, install two or more MetaTrader 4 terminals with the same account number and password. And use one terminal for one expert advisor.

By doing this, you will avoid any delays due to the error “trade context is busy”.
If you trade on several accounts, for example you are a forex money manager or signal provider, you are most likely to be using a forex account copier.

Almost all forex account copiers are based on MetaTrader expert advisors or scripts.
Expert Advisor (or scripts) compares open orders on the master account and sub-accounts every 0.5 – 1 sec.
So this adds in yet more delay bringing your total delay up to a minimum of 3 seconds.
So how can Money Managers or Signal Providers reduce latency and save thousands for you and your clients?
PowerTradeCopier – this is a forex account copier based on MT4 API. This software works directly with brokers’ servers and you do not need to run and keep running MetaTrader 4 terminals.
PowerTradeCopier sends thousands of orders to different brokerage companies at the same time via 250 flows.
This approach allows you to open / modify /close orders 1.5 seconds faster so saving money for you and your clients.

Other features are:

Copy orders from 4 digit quotes to 5 digit quotes and vice versa.
Work with different quotes symbols (EURUSD_FX, usdjpy_m, etc.).
Copies signals of Expert Advisors as well as manual trades
With PowerTradeCopier you can copy trades via the internet – useful for forex signal providers.
PowerTradeCopier contains the FIX API module that allows you to send your orders to banks or brokers via FIX protocol.
For example: Currenex, ADSS, AMIFX, MIG Bank, etc.
For more information about PowerTradeCopier please visit the website at: http://multiterminal.net

2011 @ BJF Trading Group inc. http://iticsoftware.com

Forex Robot

Boris F — Fri, 10 Feb 2012 19:24:41 GMT

So what is a Forex Robot?

'Forex Robot' can be an alternate name for the system-based approach to dealing. Robots are sets of established guidelines that determine the point at which hotspots in markets that particular stocks should be bought or sold.
Forex Robot will use the standard technical analysis devices to assist with the specification of the guidelines.
To present an illustration, its criteria might be started upon indicators such as Stochastic Oscillators, Bollinger Bands, Relative Strength and Moving Average.

Just how do the Forex Robots work precisely?

It could be that one tool may well allow a buy to occur right after a particular point of the relative strength is exceeded. Nevertheless, this won't make up a 'system' so far as the Forex Robots are concerned as it only pertains to just one component of a deal, so it is standard for rules to be composed of blended indicators.
So, it could be the situation that short-term and long-term moving average limits the Moving Average Crossover system incorporates, designs a guide that declares the short-term must go higher in comparison to the long-term before acquisitions could be performed. Or, when the opposite situation takes place, the Forex Robots will elect to sell.

Rules of this nature will supply the basis for the system's results therefore ought to successfully regulate risk, give long-term stability and boost the gain for each and every deal. To satisfy all these goals, each and every rules' limits needs to be modified. From the instance of the Moving Average Crossover, a dealer should decide if either the 10 or 30 day average is the better approach to maximise its performance prior to modifying.

Only modifying one principle would have a little impact on outcomes that the Forex Robot can generate. A system's all round success is dependent upon how its parameters should be blended.

So, exactly what might the Forex Robots deliver?

Rather than making use of a person to deal and perform recurring analysis, the Forex Robots will be thoroughly formulated and optimised systems that can immediately decide the best signals and even execute the particular deals.
By using automated decision-making procedures, a dealer eliminates emotion from trading.
It is actually often the entirely human instinct of fear or greed that could over-ride his or hers measured decisions so taking a loss.
You will discover trading systems created by particular organizations readily available as a bundle which means you can get set up instantly.

On the other hand, you have to pay a routine fee so that you will be in a situation to view trading signals they have set up rather than purchasing their systems. A few organizations will not present reliable results, therefore proper care is necessary.
Look at organizations with the Forex Robots that can help you by permitting you to trial the system on a 'live' basis.

Do you know the points to be familiar with when evaluating the Forex Robots?

To completely make the Forex Robots requires a tremendous amount of one's time to produce.
A significant amount of evaluation must be completed following the system having been designed.
Following on from the testing, it is most likely more adjustments will have to be carried out.
Paper-trading of systems live ought to be carried out to increase the robot's performance.
Even after the system becoming live, additional re-designs could possibly be needed

It is essential that when putting together the Forex Robots there is a complete understanding of the numerous technical analysing signals together with their function.

You must still expect to become aware of the different parameters and rules even though you go with using another person's services rather than your own.

You should certainly not under-estimate just how complex this is.

Whenever real performance differs considerably from estimated results, it is what is known as 'slippage' and should be avoided for the system to function successfully.
Costs must not be ignored and really should be looked at properly when building the Forex Robots.

Commission costs are going to be sustained but additionally there'll be a variation from the fill and execution price that will affect earnings.

Just how good are Forex Robots?

It's not hard to find an effective system, best forex robot, yet it's easy to become worried about the amount of con artists that fraudulently maintain excellent results when trading.

Nevertheless the greatest example of how effective these Forex Robots are is the expanding number of professional and individual dealers and fund managers which are progressively using these systems to deal.

Finally
Building the Forex Robot is difficult.

A comprehensive understanding of all the various criteria that can be used, combined with knowledge necessary to produce acceptable assumptions and not to mention the time and determination can make this a considerable task.

Yet, the increase in additional time, efficiency and profits is frequently considerable when the Forex Robot is done and implemented successfully.

Best forex robot 2010 Best forex robot 2011

2011 @ BJF Trading Group inc. http://iticsoftware.com

Development of Trading Strategies by means of Technical Indicators

Boris F — Wed, 25 Jan 2012 05:35:14 GMT

Traders and investors use different indicators for analyzing events of the past and forecasting future patterns and price trends. These indicators represent mathematically-based tools for technical analysis and include the Bollinger Bands indicator, moving averages and so on. While fundamentalists rely on different economic and annual reports, traders, who prefer using technical analysis, give preference to indicators, which help them to make interpretation of the market. The main advantage and purpose of indicators is ability to identify trading opportunities. For instance, a trend change may well be preceded by a moving average crossover. In this case, if a trader wants to find possible areas of trend change on a price chart, he should apply the moving average indicator to this chart.

On the other hand, indicators are used in different strategies quite often, because they allow to determine entry, exit and trade management rules objectively and impartially. When we say “strategies”, we mean a definitive set of rules, which regulate the process of trade and specify the exact establishment, management and closure of trades. As a rule, one and even several indicators are used in strategies in detail in order to establish instances where trading activity will occur.

No concrete trading strategies will be reviewed in the given article, but we will try to explain the difference between indicators and strategies, and also say some words about principles of their combined work, which allow technical analysts to determine very probable trading setups.

Forex Indicators

Traders can study and analyze many different technical indicators. There are commercially available proprietary indicators as well as those in the public domain, for example, stochastic oscillator or a moving average. Moreover, some traders often resort to services of professional programmers to develop their own custom indicators or do it manually on their own. The majority of indicators are provided with user-defined variables that are used by traders in order to adapt key inputs in accordance with their needs.

For instance, a moving average is just an average price of securities over a definite period of time. This period of time is stated in the type of MA (for example, a 50-day MA). The number “50” means that the given MA will show you the average price for a 50-day time period. As a rule, closing price of securities is used in calculation of MA, but it doesn’t mean that other price points can’t be used for this purpose (for instance, open, high or low). The trader can specify the price point for making calculations an also the length of the MA.

Trading Strategies

Let’s define a trading strategy once again. It is a set of rules, which regulate the process of trade and define order and time of trader’s actions. As a rule, filters and triggers are based on indicators and included as compounds of a strategy. The aim of filters consists in identifying the setup conditions, and the aim of triggers consists in timing, i.e. they “decide” when some action should be done.

Here is an example of a trade filter: a price that has closed above its 200-day MA. This prepares the ground for the trade trigger, i.e. for some event that causes trader’s actions. It is also known as “the line in the sand”. For example, when price reaches one tick above the bar that breached the 200-day MA, it well may be a condition for a trade trigger.

It should be noted that it is wrong thinking about a trading strategy as about a simple instrument, which buys when price reaches a position above the MA. A strategy is a very evasive tool and it can’t provide any specified details, which help to take some actions. Here are several items, which should be followed in order to create an objective strategy:

1. You should know what kind of MA you are going to use. You should also know length and price point, which will be included into calculation.
2. It is necessary to define a point above the MA, above which price needs to move.
3. You should choose the moment, when the trade should be entered. There are three options: when price reaches the specified point above the MA, when the bar is closed or when the next bar is opened.
4. You should also choose the type of order (market, limit), which you are going to use in order to place a trade.
5. Of course, the amount of shares of contracts to be traded should be specified.
6. Make decision about the rules of money management.
7. Finally, define the exit rules.

An objective strategy can be formed only on the basis of the abovementioned preconditions.

Development of Strategies by means of Technical Indicators

An indicator itself can’t be considered as a strategy. It only plays a role of a tool, used by traders to identify market conditions. On the other hand, a strategy is a set of rules, defined by a trader, which specify application and interpretation of indicators for the purpose of making correct predictions of future market activity. Volume, trend, momentum and volatility – these are among different categories of indicators. As a rule, several different types of indicators are used by traders in their strategies. If a trader uses multiple indicators of the same type, so-called “multicollinearity” or multiple counting of the same information may occur. Such situation is not advisable because multicollinearity may influence other variables and underestimate their importance because of redundant results of multicollinearity. Therefore, it is much better to apply indicators from different categories in a strategy: for example, a trader can use trend and momentum indicators. It often happens that traders use some indicator for making confirmation of signal accuracy of another indicator.

For instance, a momentum indicator can be used to confirm the validity of the trading signal of a MA strategy. Relative Strength Index or RSI is a momentum indicator. It compares the average price change of advancing and declining periods. There are user-defined variable inputs in RSI as well as in other technical indicators, so a trader can define, for example, overbought and oversold levels. It means that a trader can use RSI for confirmation of any MA signals. If there are opposing signals, it might point to a lesser reliability of signal and probable insecurity of the trade.

Of course, a trader must do researches of the chosen indicator (or several indicators) in order to find the most appropriate application of this indicator. Trader’s style and readiness to risk should be also taken into account. The use of a strategy has one major advantage: it allows to perform backtesting, i.e. to use historical data in order to check if the given strategy would be successful in the past. Of course, there are no guarantees that the given strategy will be successful in future, but still it is a very helpful tool for development of a profitable trading strategy.

No matter what kind of indicators you are going to use, you must clearly specify interpretation of indicators and their precise actions in your trading strategy. Indicators are just tools and do not produce any trading signals on their own, so you should include them in a strategy and be as precise as possible, because ambiguity is very dangerous.

Picking out Indicators for a Strategy

Before choosing indicators a trader should decide what type of strategy he is going to create, because it influences the choice. And again, trader’s style and readiness to risk should be taken into account. If a trader is intended to focus on long-term moves and large profits, he might use a trend-following MA indicator and create a trend-following strategy; in case a trader is intended to focus on small moves and frequent small profits, he might try to create a strategy based on volatility. A trader can also use various additional indicators in order to confirm received signals.

Of course, there is another way: a trader can simply buy a so-called “black box” trading strategy or a commercially available proprietary strategy. There are advantages and disadvantages of using this type of strategies. The advantage is that all the necessary researches and backtests have already been done in advance (theoretically), and a trader shouldn’t do anything else on his own. On the other hand, there is a major disadvantage: a trader completely trusts developers of this strategy and often can’t make any customizations in accordance with his own style of trading

Conclusion

Trading signals are not produces solely by indicators. The ways of sending signals by indicators should be developed by a trader. A trader is also responsible for creation of trading strategies. Of course, it is possible to use indicators without being used in combination within a single strategy, but at least one type of indicator is necessary for creation of technical trading strategies. Creation of a strategy, which represents a set of rules, which regulate the process of trade and define order and time of trader’s actions, allows a trader to perform backtests in order to find out if his trading strategy would be viable. It also allows a trader to draw conclusions about behavior of a strategy in future. It is very important to technical traders, because it allows them to make constant evaluation of the strategy performance. Moreover, it allows traders to make decisions concerning time of closure of a position.

There are talks among traders about some king of “Holy Grail”, which would allow them to make profit instantly. Unfortunately, there is no perfection in our world, and there is no possibility to develop an ideal strategy that will bring guaranteed profit to all traders. There are many traders, and each has his own style, readiness to risk, temperament and personality. It means that everyone decides by himself what technical analysis tools he is going to use. Traders also have to make researches personally and develop strategies on their own, basing on the results of these researches.

http://iticsoftware.com

2011 @ BJF Trading Group inc. http://iticsoftware.com

Forex Scalping

Boris F — Wed, 14 Dec 2011 19:25:26 GMT

Forex Scalping Strategies Explanation Video

Best Scalping Expert Advisor 2010

Best Scalping Expert Advisor 2011

2011 @ BJF Trading Group inc. http://iticsoftware.com

Forex Grid Strategies

Boris F — Fri, 02 Dec 2011 04:48:42 GMT

Learn more about Forex Grid Expert Advisors

2011 @ BJF Trading Group inc. http://iticsoftware.com

Forex Scalping Strategies

Boris F — Thu, 24 Nov 2011 05:47:25 GMT

Probably the most popular type of forex trading strategies can be considered as a forex scalping strategies.

There are several reasons for this:

Not require a large initial capital
Opportunity to obtain high profits
Active trading style
Short period in the position reduces the risk of loss

There are many definitions of scalping strategy. The most accurate definition of scalping strategy is receive a small profit (several pips) in a short period of time.

A little bit history....

Several years ago, the company Metaquotes from Russia has released MetaTrader terminal, and MetaTrader server. This has stimulated the creation of a large Number of brokerage companies with small capital and only one goal: force the trader to lose all deposit. MetaTrader server has all necessary tools for the destruction of any strategy. Such brokers can be compared to a casino. Advantage casino over the player is a large supply of money and time. For this reason scalping strategy which does not require large deposit and order remains open for a few minutes or seconds, give the trader an opportunity to win. To prevent the winning brokers decided to expand spreads and limit the distance (up to 10 pips) between Stop Loss, Take Profit and Pending Orders and price.

Factors affecting scalping

Liquidity – The liquidity of a market affects the execution time and as a consequence on performance of scalping.
Spread - scalper's profit is commensurate with the spread. For this reason, any spread increasing may affects on performance.
Volatility - Unlike momentum traders, scalpers like stable or silent market. Imagine if its price does not move all day, scalpers can profit all, making hundreds or thousands of trades.
Time frame - Scalpers operate on a short time frames, like M1, M5 and M15. This maximizes the number of moves during the day that the scalper can use to make a profit.
Money management – usually 1 loss for scalping strategy can be 2 -10 times bigger then 1 profit. For this reason scalping strategy can have very strict money management never allowing a loss to accumulate.

Scalping types

There are many methods of scalping. The most popular method is the opening orders in on the low volatility market in the moment when price touch of the border of regression channel or support /resistance lines or High/ low level.

But I do not accidentally said at first about the scalping history of Factors affecting scalping.

Currently profitable scalping strategy can be created only by a professional who knows not only forex trading but also the work of brokerage companies as well as having extensive experience in programming. For example adding 3 lines of programming code allows force a dealer to make a mistake, can turn losing strategy in to a winning strategy.

For this reason for a successful scalping you need an expert adviser coded by a professional company and reliable broker. Good luck!

http://iticsoftware.com

2011 @ BJF Trading Group inc. http://iticsoftware.com

Account Copiers Latency Comparison

Boris F — Tue, 27 Sep 2011 19:00:51 GMT

PowerTradeCopier

Visit our website for more information

FIX API Module Explanation

More Information about FIX API Module

2011 @ BJF Trading Group inc. http://iticsoftware.com

Expert Advisors Comparison

Boris F — Fri, 22 Jul 2011 03:52:57 GMT

We get a lot of questions what is your best adviser, or what is your best indicator. I'll try to clarify some points.

Expert Advisors

We have a lot of Expert Advisors based on different algorithms. What could be the starting point when choosing a EA. I think best way is start choosing from information about account.
If your broker support minimal lot =0.1 and you account size $1000 or more; or your broker support 0.01 and your account size 100 or more, you can use scalping systems. I can recommend you Expert Advisor "SC-Market".

If your broker support minimal lot =0.1 and you account size $2000 or more; or your broker support 0.01 and your account size 200 or more, your can use scalping systems and also you can use hybrid (Scalping + Trend Following) systems. I can recommend you: Expert Advisor "SC-Market", Expert Advisor "TFOT"

If your broker supports minimal lot = 0.01 and your account $5000 or more, you can use Scalping, Hybrid and also grid systems and systems with increasing lot (non martingale!).
I can recommend you: Expert Advisor "SC-Market", Expert Advisor "TFOT", Expert Advisor "SecureProfit", Expert Advisor "Eldorado".

Expert Advisor "Eldorado"

Expert Advisor "SecureProfit"

Expert Advisor "TFOT"

Expert Advisor "SC-Market"

Metatrader 4 Indicators

The indicator is not a trading system and part of the trading system. You should create your trading rules using indicator(s) or use rules provided by reliable sources. We have described several manual strategies and will post new strategies with recommended indicators : forex-profit-systems.com

For more than 10 years our company has been offering products and services for forex market and today we are giving our customers 25% discount for all products which were created during this term. Don't miss it - our Anniversary Offer expires soon!

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2011 @ BJF Trading Group inc. http://iticsoftware.com

Forex Divergence and Hidden Divergence

Boris F — Wed, 13 Jul 2011 04:47:15 GMT

Regular Divergence

A divergence is a separation between price and indicator that warns of a possible short- to intermediate term change of trend. A bullish divergence arises during a down move when price makes either a lower low or a double bottom but the indicator makes a higher low or a double bottom.

A bearish divergence occurs during an up move when price makes either a higher high or a double top and the indicator makes a lower high or a double top. Classic divergences can occur at price tops or bottoms and also at price corrections.

For our opinion most correct way to determine divergence is determine divergence between fractals on price.

Hidden (Reverse) Divergence

In a bullish hidden divergence, the indicator makes a lower low, but price makes either a higher low or a double-bottom low. This type of nonconfirmation occurs mainly during corrective declines in an uptrend, but it may also be found on occasion at price retests of the lows.

In a bearish hidden divergence, price makes a lower high, but the indicator makes a higher high. This type of nonconfirmation is mainly found during corrective rallies in a downtrend but may also occur during retests of a price top.

Standard and Advanced Divergence Indicators

Standard divergence indicators shows divergence between price and standard oscillator (MACD, Stochastic, RVI, RSI, etc...)

Advanced divergence indicators hows divergence between price and advanced oscillators (PowerRVI, Hurst, John Ehlers Indicators )

2011 © http://iticsoftware.com

2011 @ BJF Trading Group inc. http://iticsoftware.com

Trailing Stop Loss

Boris F — Mon, 27 Jun 2011 18:28:04 GMT

Whether it is a long-term investment or a short-term trade, it is important to both decide the appropriate time to exit a position, as well as determine the best time to enter into the position.

The Trailing Stop

They may appear similar as they both equally provide protection towards your capital if a price were to move against you; however, that is all that is similar between a trailing stop and a regular stop.

When compared to a fixed stop loss, a trailing stop has more advantage in the sense that it is much more flexible, allowing traders to continue to protect their capital even if there is a price drop. Once the price picks up and increases, the trailing feature takes place to protect the profit while reducing capital risk.

To illustrate how trailing stops work, take for instance the trailing value is either at a fixed percentage of 5% or a fixed spread of 35 cents. Regardless, the trailing stop will follow the day’s high by the predefined amount. However, the thing to note is that once the trailing value is set, it cannot fall back, and even if the last price drops lower than the trailing stop value, the stop loss will be triggered, preventing loss.

The Parabolic Stop and Reverse (SAR)

Using the parabolic stop and reverse (SAR) technique, one can place stop-loss on both sides of the market so the movement is incremental each day with the changes in price. The SAR is in fact a technical indicator that is plotted along a price chart, occasionally intersecting with price when there is a reversal or loss of momentum in the security involved. When an intersection occurs, the trade is considered stopped out, creating an opportunity to take on the other side of the market.

Using an example to explain this, when your position is stopped out, the security will be sold, leaving the position closed. This allows you to sell short with a trailing stop immediately on the opposite (parabolic) to the level where you were stopped out in your position on the other side of the market earlier. Basically, the SAR technique allows a person to capture both sides of the market as a security faces fluctuation over time.

The major proviso of the SAR system is the erratic fluctuations of a security. When the price of the security fluctuates very quickly, the trailing stops will be triggered as well each time, making it difficult to achieve sufficient profits. In other words, your trading commissions and other costs will be greater than the little profitability you gain from a choppy market.

The second proviso of SAR is a security that does not show a significant trend. A trend that is too weak will make it impossible for the stop to reach, so your profits will not be locked in. Hence, the SAR is not suitable for securities that lacks trends or has trends that fluctuate back and forth too quickly. However, the SAR makes a perfect choice when it comes to determining your levels of trailing stops if you are able to identify opportunities between the extremes.

Universal Trailing Stop Expert Advisors

Universal Trailing Stop Expert Advisors included:
a) Standard Trailing: simple trailing, stoploss follows by the market
b) High/Low Trailing: trailing by bars High/Low
c) ATR Trailing: trailing by ATR indicator
d) Fractals Trailing: trailing by Upper/Lower Fractals
e) PSAR Trailing: trailing by Parabolic Stop And Reverse indicator
f) ProfitPcnt Trailing: trailing with lock of some pcnt of max. profit reached
g) TrendLine Trailing
h) MovingAverage Trailing
a) Standard Trailing: simple trailing, stoploss follows by the market
b) High/Low Trailing: trailing by bars High/Low
c) ATR Trailing: trailing by ATR indicator
d) Fractals Trailing: trailing by Upper/Lower Fractals
e) PSAR Trailing: trailing by Parabolic Stop And Reverse indicator
f) ProfitPcnt Trailing: trailing with lock of some pcnt of max. profit reached
g) TrendLine Trailing
h) MovingAverage Trailing

Read more about universal Trailing Stop

2011 © http://iticsoftware.com

2011 @ BJF Trading Group inc. http://iticsoftware.com

The Concept of Forex Grid Trading

Boris F — Wed, 08 Jun 2011 18:42:37 GMT

Forex Grid Introduction

Forex Grid Trading is s trading strategy, which can be applied at the Forex market. This kind of strategy is based on determining the natural back and forth motion of the market. After determining this motion you can place orders below and above the current market. As a result, you will gain profit so far as market moves. The best advantage of such kind of forex strategy is that you almost don’t need to predict the direction of market movement.

From the other hand, instead of predicting the price you will have to lay special emphasis on money management, psychology of trading and grids visualization problems, which will arise when you try to use forex grid trading strategy.

In addition, you should realize that it is impossible to completely forget about market analysis even in case of using grid trading.

Basic Forex Grid Design

There are many different grid configurations, which are available for use, but, curiously enough, all these different versions are based on one common idea. Here is an example of the very basic forex grid for the EUR/USD currency pair.

It is the simplest example of forex grid trading, so the numbers in this example will be as simple as possible. Let’s take a snapshot of a hypothetical market and imagine that our currency pair (EUR/USD by default) is trading at 1.4500. Let’s use ten pip intervals.

As it was mentioned before, forex grid trading is based on placing orders below and above the current market, so we need to place our buy and sell orders above and below the price respectively, using specified preset intervals. Each order must have a uniform Take Profit target. There won’t be any Stop Loss orders at all. In order to further simplify management of the grid traders often use two trading accounts.

Don’t forget that our EUR/USD currency pair is trading at 1.4500; therefore, let’s place buy and sell orders above and below this value. For instance, our buy stop orders would be at 1.4510, 1.4520, 1.4530, etc, and our sell stop orders would be at 1.4490, 1.4480, 1.4470, etc.

Take profit and stop loss will be attached to each order. After that we can place our grid into motion.

Examples of Forex Grid Trading

The simplest probability here is if the price is moving up or down. In case of upward motion the buy orders will be opened; these orders won’t be closed until the price reaches their take profit level. In case of reverse of the price and downward motion the sell orders will be opened; these orders will be closed in profit as the price moves down. When some position is closed, a new order will be opened. In our example with ten pip intervals selling occurs every ten pips below the market price, and buying occurs every ten pips above.

As you see, it is much better that the necessity to predict the behavior of Federal Reserve for every week. Of course, our example is the simplest one, and everything is a bit more complicated in a real world. Let’s suppose that the market price fluctuates up and down, because such situation is much more probable.

As it was said before, a buy order will be opened if the price goes up, but what happens if the price starts moving down before the take profit level of the opened buy position is hit? Such position becomes loss-making, and the lower the price is, the more money such position loses. Even in case the price reaches your profit level of the sell orders, you still have this opened buy order which increasingly yields a loss.

Now we should add a bit more complexity in the situation. Imagine that the price starts moving up before the take profit level of the opened sell position is hit. As you see, it is the same situation, but it is reversed: your order, which is placed below the market price, yields a loss while the price is rising. The one positive moment here is that the abovementioned “dangling” buy position will begin to recover.

As you can see, one of the shortcomings of forex grid trading is a possibility to lose money because one position (or several positions) can be caught far away from the market price. In this case, loss is possible even in case other positions bring you profit. Actually, this is the point: your grid trading strategy would be successful if you were able to carry losing positions for some time, and this period can be quite long. Your psychological and financial condition should allow you to do it, otherwise you will fail.

First of all, let’s speak about your financial condition. It is obvious, that you should have enough money for carrying losing positions, because balance/equity of your account are lowered by this position and your margin is eaten away. There are even some cases when the market does not move back, and you have to pay swap. The only salvation of this problem is availability of funds in your account. Actually, it happens quite often that traders accumulate losing positions and deplete margin, so they have no possibility to wait until the market moves back.

Secondly, let’s speak about your psychological condition. In some way this matter is even more difficult in comparison to finances, and here is the reason. Many traders, who have decided to use grid trading, expect the market to move only back and forth (so their positions will be profitable all the time). They want to make money without learning the basics and worrying about fundamentals. So when they see that positions not only bring profit, but also can be loss-making, they become a bit confused. And only then such trades start understanding that grid trading do requires some basic knowledge about position of a given market at a given time.

One of the main challenges of Forex grid trading is the ability to manage a losing position or several positions, which can appear either at the top or at the bottom. And this matter puts a great strain on the grid trader. Grid trading is often criticized for such state of things.

Forex Grid Money Management

Money management is very important for grid trading, because it can help to solve problems concerning the constant threat of undesirable market movements, which can cause appearance of losing positions.

First of all, as we’ve already mentioned, you should have enough money in your account to be able to stay in the ever-moving market and to allow your grid strategy to work. Your account won’t be blown up because of your conservatism or too small lot size, but it will be blown up if you don’t have enough money in reserve.

Secondly, you should decide for yourself for how long you can afford yourself carrying losing positions. You should clearly understand that such positions will arise almost all the time you use grid trading.

Forex Grid Conclusion

Grid Trading is a very popular strategy for Forex trading. Automation and visualization are two main advantages of grids. From the other hand, you should understand the basics of the market in order to use grid trading more efficiently.

Forex Grid Trading requires use of money management and advertence concerning available margin, because margin calls are very dangerous. Forex Grid Trading has a very good structure, but it is not a “magic stick”, which will bring you money with ease. You can be successful with the help of Forex Grid Trading, but at the same time you should learn its specifics and know how to deal with its challenges.

Forex Grid Professional Strategies

Expert Advisor fo MetaTrader 4 "Eldorado"

Currencies: CHFJPY, EURCHF, GBPUSD
Timeframe: Any
Using Indicators: No
Trading Time:24 hours per day
Risk: Medium
Minimum Deposit: $5000 ($500 with Lot =0.01 )
Recommended Deposit: $20000 ($2000 with Lot=0.01)
Orders Type: BUYLIMIT and SELLLIMIT pending orders
Money Management: Stop Loss and Take Profit, closing by profit, closing at time
Metatrader expert advisor Customization: possible upon the request
NOT sensitive for broker

More information about Expert Advisor "Eldorado"

2009-2011 © http://iticsoftware.com

2011 @ BJF Trading Group inc. http://iticsoftware.com

Different Types of Money Management for Expert Advisor

Boris F — Tue, 31 May 2011 04:43:50 GMT

MM for Expert Advisor - Percent by Account Balance

First and most popular type of money management for expert advisor is lot size calculation proceeding of account balance.

Lot Size = percent by account balance

Example 1
Percent =10%
Account balance = 10 000
Lot size = 1000 (1 standard lot)
Your expert advisor win 2000 and account balance became 1200 next lot size will be:
Lot Size = 1200 (1.2 standard lots)
etc.

This money management system useful for traders preferring high profit/risk ratio. During favourable market conditions may be prompt profit increasing and vice versa.

MM for Expert Advisor -InvestMM

(BJF Trading Group innovation, 2011 © iticsoftware.com)

Second types of money management for expert advisors most useful for traders preferring low risk. Similar type of money management uses by banks for some types of mutual funds portfolios. The basic principle for this money management - trade with the highest risk at the beginning and risk reduction by the end of the period of investment.

Example 2

Investment period 1 year
InvestPeriod.Start = D'2011.01.01 0:00';
InvestPeriod.End = D'2012.01.01 0:00';
Initia lPercent 15 %
Final Percent = 3%
Initial deposit 10 000

Expert advisor will open first trade with lot = 1500 (1.5 standard lots) and then percentage will gradually decrease and by the end of the investment period percent will be 3%

External Parameters:
extern bool     UseInvestMM = false;
extern datetime InvestPeriod.Start = D'2011.01.01 0:00';
extern datetime InvestPeriod.End = D'2012.01.01 0:00';
extern double   InitialPercent = 30.0;
extern double   FinalPercent = 10.0;
extern bool     FixBalance = true;
extern double   FixedBalance = 10000.0;

MM for Expert Advisor - Winning Series MM

(BJF Trading Group innovation, 2011 © iticsoftware.com)

The basic principle for this money management - expert advisor will reduce lot size after a series of (a few in a row) of profitable trades. Lot size will decrease until expert advisor will open a losing order. After losing order, the lot size will be the initial again. Such an approach, with the correct parameters , will let open a non profit order with a minimum lot size.

Example 3

Initial deposit 10 000
Success Deals Number 3
Lot percent 60%

1st order lot size = 1
2d order lot size = 1
3d order lot size = 1
4th order lot size = 0.6
5th order lot size = 0.36 (losing order)
6th order lot size = 1
etc.

External Parameters:
extern int SuccessDealsNumber=2;
extern double LotPercent = 50;

We can add any type of money management for your expert advisor (source code, mq4 file is required)
contact us

2011 @ BJF Trading Group inc. http://iticsoftware.com

Chaikin Money Flow Divergence

Boris F — Mon, 09 May 2011 20:27:00 GMT

Chaikin Money Flow Indicator was developed by Marc Chaikin. Chaikin Money Flow measures the amount of Money Flow Volume over a specific period. Money Flow Volume forms the basis for the Accumulation Distribution Line. Instead of a cumulative total of Money Flow Volume, Chaikin Money Flow simply sums Money Flow Volume for a specific look-back period, typically 20 or 21 days.

Money Flow Multiplier = [(Close - Low) - (High - Close)] /(High - Low)
Money Flow Volume = Money Flow Multiplier x Volume for the Period 20-period CMF = 20-period Sum of Money Flow Volume / 20 period Sum of Volume

Chaikin Money Flow Divergence

Divergence can show up in the indicator when the CMF indicator makes a higher high, while the price action makes a lower low. This implies that there is less selling pressure pushing the security lower, thus a bounce is in order.

Example 1 - GBPAUD Time Frame: M30

Example 2 - GBPCAD Time Frame M30



Read more about Chaikin Money Flow Divergence  Indicator

© 2011 http://iticsoftware.com

2011 @ BJF Trading Group inc. http://iticsoftware.com

Hurst Exponent Divergence

Boris F — Tue, 03 May 2011 18:32:00 GMT

Hurst Exponent Theory

The Hurst exponent is applicable in several areas of applied mathematics such as fractals and chaos theory. The Hurst exponent can yield interesting results when applied to financial data. Finance data have a fractal nature, has lead a lot of mathematician to apply the mathematics of fractals and chaos analyzing financial time series.

A few references are listed below:

Benoit Mandelbrot, who later became famous for his work on fractals, wrote the early papers on the application of the Hurst exponent to financial time series. Many of these papers are collected in Mandelbrot's book Fractals and Scaling in Finance, Springer Verlag, 1997.

Edgar Peters' book Chaos and Order in the Capital markets, Second Edition spends two chapters discussing the Hurst exponent and its calculation using the the rescaled range (RS) technique. Unfortunately, Peters only applies Hurst exponent estimation to a few time series and provides little solid detail on the accuracy of Hurst exponent calculation for data sets of various sizes.

The Hurst exponent is used as a measure of the long term memory of time series, i.e. the autocorrelation of the time series. Where a value of 0 < H < 0.5 indicates a time series with negative autocorrelation (e.g. a decrease between values will probably be followed by an increase), and a value of 0.5 < H < 1 indicates a time series with positive autocorrelation (e.g. an increase between values will probably be followed by another increase). A value of H=0.5 indicates a true random walk, where it is equally likely that a decrease or an increase will follow from any particular value (e.g. the time series has no memory of previous values)

The Three Principles of Hurst Exponent

Value 0.5 – 1 = whatever is happening now is likely to continue
Value 0 – 0.5 = whatever is happening now is likely to reverse
Value around 0.5 = likely to go in any direction

Trading Strategy Based on Hurst Exponent

Hurst Value around 0.5 = likely to go in any direction
This situation very very suitable for scalping strategies. Very low probability of breakdown of the trading channel.

Value 0 – 0.5 = whatever is happening now is likely to reverse.
Best way to waiting for divergence signal (arrow) and find reverse zone.

Value 0.5 – 1 = whatever is happening now is likely to continue
Keep current position.

Pic.1 - Indicator Hurst Divergence

Trading Signals (see Pic. 1)

Signal 1 - Hurst Exponent: Value 0 – 0.5, Divergence: down arrow - Sell signal
Signal 2 - Hurst Exponent: Value 0 – 0.5 Divergence: up arrow - Close Sell and Buy Signal
Signal 3 - Hurst Exponent: Value 0.5 – 1 Divergence: down arrow - Ignore

Read more about MetaTrader Indicator Hurst Divergence

BJF Trading Group
http://iticsoftware.com

2011 @ BJF Trading Group inc. http://iticsoftware.com

How to use NewsTool

Boris F — Tue, 26 Apr 2011 02:33:00 GMT

Our NewsTool forex software allows you to read economic calendar on your PC and use it together with Metatrader 4 .

This forex software receives economic calendar from forexfactory website and displays it in separate window on your PC. You can filter news by currency.

NewsTool connected with script in Metatrader 4 platform and allows you to:

remove all open orders CloseOrders = true/false;
remove all pending orders DeleteOrders = true/false;
close the chart on which the advisor works CloseCharts = true/false;
close metatraderВ CloseTerminal = true/false;
and open metatrader at preset time StartTerminal = true/false.

For example if your strategy is sensitive for unpredictable market movements and you trade eurusd currency, you can select eurusd and news with high importance and adjust script remove all open orders CloseOrders = true. You also can adjust time when you want to close all orders. This will help you to avoid big loses.

News Tool Software

2011 @ BJF Trading Group inc. http://iticsoftware.com

PowerTradeCopier new Features

Boris F — Wed, 13 Apr 2011 02:52:00 GMT

Account Copier PowerTradeCopier Trader Mode

Account Copier PowerTradeCopier Trader Mode realized. Trader mode is very useful mode for professional traders. If you g=have several accounts with several brokers, Trader mode allows you to immediately compare ticks for all brokers and send order to broker with better price. For example if your forex trading strategy generate buy signal, account copier will compare ticks for all brokers and send order to broker with lower price.This will allow you to earn several extra pips.

Learn more about PowerTradeCopier software on our website

Account PowerTradeCopier Software New Features

PowerTradeCopier software able to determine leverage of each account
The history of slave’s orders are available
Provoder mode now allows to set up client password for each slave. Hence master instance of software would display all slave accounts but trading signals from it would be copied only to the slaves accounts for which the same client password is set as the one which is specified in Settings window.

all new features are described on our Account Copier blog

© 2011 http://multiterminal.net

2011 @ BJF Trading Group inc. http://iticsoftware.com

Expert Advisor SecureProfit

Boris F — Wed, 02 Mar 2011 05:53:00 GMT

Expert Advisor SecureProfit

Expert Advisor initiates and manages trade sequences. First trade (market BUY or SELL) based on FastMA and SlowMA cross. Another trades of sequence added on some distance from previous trades. Distances and lots are external parameters. Trade sequence effectively closed on a wave end by GlobalTP value when the market rollbacks.

Expert Advisor SecureProfit Orders Levels

Expert Advisor SecureProfit opens a set of orders at different levels:
Lot1 = 0.01;
Lot2 = 0.01;
Lot3 = 0.02;
Lot4 = 0.03;
Lot5 = 0.05;
Lot6 = 0.08;
Lot7 = 0.1;
Lot8 = 0.13;
Lot9 = 0.17;
Lot10 = 0.2;
Lot11 = 0.23;
Lot12 = 0.27;
Lot13 = 0.3;
Lot14 = 0.5;
Lot15 = 0.7;

Expert Advisor SecureProfit Orders Distance

OrderDist2 = 30;
OrderDist3 = 30;
OrderDist4 = 30;
OrderDist5 = 30;
OrderDist6 = 30;
OrderDist7 = 40;
OrderDist8 = 40;
OrderDist9 = 40;
OrderDist10 = 40;
OrderDist11 = 40;
OrderDist12 = 50;
OrderDist13 = 50;
OrderDist14 = 50;
OrderDist15 = 50;

This is not pure Martingale. This is the expert advisor with complex money management and adding to a position at different levels.
Open of the first position based on MAs direction and daily candle analize.
We make profit on:
a) Market trend to direction of first order
b) Market rollback after counter-trend

Expert Advisor SecureProfit Hedge Options

Hedge options can be used.

//0 - never
//1 - always
//2 - if short series is not started
//3 - if short series is started
extern int StartL 2;

//0 - never
//1 - always
//2 - if long series is not started
//3 - if long series is started
extern int StartShortSeries = 2;

extern bool CloseL false;

Expert Advisor SecureProfit Global Money Management

SecureProfit has Global MM options:

GlobalSL. true;
GlobalSL$ = 700.0;
GlobalTP. true;
GlobalTP$ = 150.0;
ExtraGlobalTP$ = 5.0;

Learn more about expert advisor SecureProfit

FaceBook Page

2011 @ BJF Trading Group inc. http://iticsoftware.com

Users Opinion About Forex Divergence Indicators

Boris F — Fri, 18 Feb 2011 13:47:00 GMT

Forex Divergence Indicators

Boris -

Thanks for the AO indicator and also the ADX Divergence demo.

If you go to this link you will see me live statement using the AO Divergence Indicator. (I started with the ADX demo, but switched to the AO when I got the demo.

http://thefxdesk.com/index.php?option=com_wrapper&view=wrapper&Itemid=206

You can see I am doing very well with your divergence indicators. Thanks agaian.

Ernest L.

Hi Boris,

Thank you for ADX divergence indicator and for BollingerBands Divergence Indicator . I successfully use them for my real account. Please, provide me for discount for DeMarker Divergence . Demo works well for me.

regards,
Simon S.

I use BolingerBands Div from BJF for aggressive scalp eur and jpy, Timeframe m5.
Dec. + 350 pips
Jan + 180 pips

Can you create EA for me?

Fedor D.

2011 @ BJF Trading Group inc. http://iticsoftware.com