When you start trading the Grid Trend Multiplier with no experience the decision about which Forex Gap or Grid sizes or currencies to use can be tricky. Below are some ideas you can use as a guide.
Starting with the historic ranges
Gap sizing depends very much on the currencies volatility. There is a relationship (not perfect) between the currencies volatility and the range it trades in. So one approach is to look at the range the currency has traded in the last 4 to 12 months. Once you have established the range you can divide the range by the maximum number of open trades you are comfortable with.
In this example we are going to use 30 open trades as an example. So you would simply divide the range by the number of open deals you are comfortable with.
Using the EURUSD below as an example the range is 500 divided by 30 open trades = gaps of 16 pips. 16 pips is a reasonable gap. To be more conservative multiply that by +/- 30% to 50% and to be more aggressive multiply the reduce the 16 pips by +/- 20 to 50%.
You can vary all of the above variables to meet your own personal views but the principle presented should point you in the right direction bearing in mind there is never a perfect answer in Forex trading.
Account Sizing
After you have established the above elements you need to size your account accordingly. Please use the Grid Trend Multiplier Excel model to do this
ACCOUNT SIZING
On the charts below:-
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the first green number is the conservative grid size,
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the middle green number is a reasonable grid size and
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the last green number is a more aggressive grid size.
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The blue number the range
As at 9 May 2014
good approach.
Thanks Alex
Hi Alex,
Will the smaller range pairs visit the same price more often than the wider range pairs?
Thanks Alex that’s a great help
Alex,
This is great help! Please keep it on!
No not necessarily. If you use a 10 pips gap for the EURJPY (bigger range) and a 10 pip gap for the EURCHF (small range) you will find a vast difference. The EURJPY will probably have 4 to 10 times more visits. The EURCHF will however have more safety
hi Alex,
looking at the GTM trading I noticed the pips collected at profit are very fluctuating.
So the target is not fixed to a number of pips+spread, but just target without adding spread)?
In this way a lot of pips are lost in the long run which further unbalances the Excel scheme.
Another thing concerning the Excel sheet is your approximation of the number of cash-ins, calculated by Daily range/grid size x1.5 to 2.0.
The number of cashins is crucial to the succes of the strategy, so have you considered making a script to count the actual possible cashins in the lookback period ( the period you use to determine the grid size).
I would not be surprised that there are pairs that have a higher oscillation rate than expected. Without having real data I expect usdchf to oscillate much more than eurusd because of lower liquidity combined with the inverse correlation
this website has no longer the possibility to ask for a mailing if you post an answer?
I’m still in the learning stage of using this tool in random mode and so far I decide on the direction and manually check in occasionally. I found it revisits whole or round numbers on particular pairs frequently during consolidation and it really did multiply when it finished its run. Superb EA and Ive only just started. Bravo Alex and Mary. !!
Good to hear about your success- the multiplier is the main aspct of this EA and that is why the name changed too.
Just started and I am very pleased with the Grid Trend Multiplier. I used it for 4 days this past week
May 6 – May 9th 2014 and am only using the default settings with the EUR/JPY. I made $1100.00
My lots varied from .01 to .04 I don’t have any questions, all I know is that it works. Best regards, Howard
Hi,
I used GTM on 4 different brokers with default setting on EURJPY and 0.01 lot size for buy and sell. The results is that the balance increased by 4-8 % where as floating loss has increased double than the gain.
Any advise to reduce floating loss!
Regards,
Dhiraj
Yes – this is the most difficult part of this set and forget strategy: Just Set and Forget.
Sooner or later the closed deals balance will be bigger than the open deals balance. It sometimes take a few weeks for this to happen so you often have to find something else to do in that time. If the closed deals never exceed the open deals you may experience a margin call.
View these links for more info:- https://gridtrendmultiplier.com/a-risk-management-strategy-for-using-the-non-directional-grid-trend-trading-approach/ or http://www.youtube.com/watch?v=gSd6HHZzQO4&list=UUw5NuBE-K4qo6eJzyO1bT6g&feature=share
Hi Alex / All
This is a post on Pruning & Balancing which I had to post on here because the comment facility isn’t enabled on the pruning page.
As we know the EA allows for a maximum number of open positions whereby allowing trades to be continuously opened whilst at the same time closing out the biggest looser to maintain such. As far as the EA is concerned the maximum number of open positions are the sum of both the open and closed orders.. right?. Ie 20 open orders but that doesn’t necessarily mean they are confined to 10 on each side.
The video speaks of balancing to have an approximate equal number of buy’s / sells on either side which is semi-contradicting what the latest EA addition is doing.
Assuming my maximum number of open trades is 20, then if I have 15 buys and only 5 sells this is obviously way out of balance and the EA won’t understand this
What is the thinking?
Should the maximum number of open trades (say 20) be controlled to allow only 10 each side to ensure balancing is maintained? OR
Does it not matter anymore given the EA looks after it as it is programmed to do, and the process of balancing is essentially if one was to prune manually?
You thoughts?
Mark
Yes the video was confusing as it dealt with both pruning and balancing at the same time. As result of your question I have created the following page https://gridtrendmultiplier.com/balancing-your-grid-trend-multiplier-open-trades/ Hopefully this helps.