This isn’t exactly my own invention/system; I got the idea from the etoro guru ‘Viking1961’ another fellow dane.
It seems like the most solid and quite simply system I have ever come across, so I hope you can either point out the flaws or confirm that this is the holy grail in which case I should probably up my investment
Philosophy behind the system: The basic idea is that you select a currency pair and find a channel of ‘min-max’ boundaries + a safe zone. The two year high-lows of a single pair. This will form the ‘channel’ within which one trades for the next 3 months.
Indicators and parameters: None. You just use past history of a currency pair to pick your channel.
Entry and exit signals: None. Every 50 pip move up or down a new trade will be triggered and reach TP.
Stop loss and profit target placement: You start out opening both sell and buy orders and with TP 50 pips away. Whenever you reach a TP you open up two new trades at that level with another 50 pips for TP. That way you will effectively range-trade up and down a currency pair, continually taking pips to the bank and slowly increasing the amount invested. Each closed trade takes you another step. Michaels plan is to take 2000 USD and turn it into 400.000ish within a relatively short periode (some 2 years or so).
Backtest results: I am currently copying this trader. With a mere 50 USD on a live account. Its intended for 2000 USD, but I am playing on the safe side until I have confirmed that this actually works.
Hi, Im trying to figure out where the profits are coming from, reading your post and the creators post, it seems like your always in, taking profit every 50 pips, but opens a new order imidiatly, and also having a massive counterposition… It looks like its just paying alot of spread, and when the SL is reach you would loose everything?
Maybe position size is the secret, could you explain more about wen you are taking profit, and there is no counter trade that is offset?
I am not an expert in this system myself; at the moment I am just copying the signal. There is a gradual increase in position sizing so that will explain some of it. Every position opened is usually around 1-2% of the total equity. At the moment only 30% out of the available amount is used, so even if they all hit SL it would still have been profitable (given the 160% increase over a year). And yes, when you reach the boundary of your channel; say the top. You dont open up new buy orders.
Also the spread is accounted for in the TP-placement and the opening of new orders.
Anyway - I am hoping someone here can give this system a proper ‘system-check’, as profits keep coming in, and I see no way it could bust except maybe at some point if the currency pair went completely outside the channel, but even then there would be profits left.
Lately, I’ve been learning that more exposure [time] in the market = more risk. So when there is no precise entry and exit and just leaving it to the market to reach 50 pips seems risky because anything can happen within that timeframe; price and reverse and run into a loss of 50 pips.
This is basically a grid system with 50 pip lines. What can happen, is if price is towards the top of the channel, and then starts trending down towards the other side, hitting each 50 pip sell TP, but no buy TPs the first buy will be left open, along with all the other buys, and the total balance (equity) will remain the same as initial balance. When the trend, in this scenario, reverses and starts taking out the buy TPs, now you have an equal amount of sells left open, and in a 1800 pip range, that could be 36 open positions, so you would have to use very little margin per position to avoid margin call…also you’ll always have to be trading this, because you can’t afford to just close all the open orders, because they will all be in loss.
Did you notice the total equity line on the etoro page link? It never gets postitive. You basically have to agree, assuming everything else about the strategy works, and you don’t ever get margin called, that the initial deposit is to be given up and only profits will be money you can get back, yes you might get part of your deposit back, but not all, if you have to close all open trades.
Im pretty sure this is a loosing strategy,
realized equity is just the positions that are closed and turned in to profit,
but I think Total equity incl closed position( = balance) and open position(loosers and winners), therefor, when he always closes the winners, is realized equity wil just keep going, until he gets a margin call…
the total equity is the chart I think you have to look at, wich equals to a loosing strategy, I would not follow this, it looks like a scam
Sorry…
Take a look at the Total Gain(-5%) for the last 180 days, and percentage winning trades(99,9%), the stats just looks good becaus he never closes a losing position, just hedges it into infinity(/margin call)
EDIT 2
Its actually genius, Viking guy earns money on followers, and gets a lot of them(almost 1000) so there is were the money are
[EDIT 3]
Just noticed the above post…
In other words, dont trade this! Good Luck
Pipcompounder is basically spot on with his comment. Providing the market stays within the range you will have a max of (range/50) open, loss making, orders with a resulting maximum cumulative risk of (50+250+350+ … +numberoforders*50) pips.
Can such an exposure be managed with a $2000 account? Is the market going to stay within the range for two or more years to allow you to complete all the steps? Who knows … but all the time you will have a great deal of orders open with no SL to protect you from such eventuality.
Basically, there’s substantial risk of margin call here, unless i missed something of course.
Having said all that, and with only minimal analysis done, i can see the temptation in this strategy. If you get to a point where you have doubled your account you can then take 50% out and you are at break even. After that point anything is profit and provided you take amounts out of the account regularly you don’t much care about margin call either.
The one last thing to consider also, of course, is the spread. If it’s as little as 1 pip, that is 1 pip your total equity loses with each opened trade, even though as price moves, you would be hitting TPs in either direction. I’m not saying this is impossible, just that you have to use very small positions, and be careful of the channel limits, for instance the EUR\USD is past a 14 month high, up 1600 pips from last summer’s low, so all of those sell positions would still be opened, and the equity being hedged, minus the spread, with all the TP’s you hit on the way up. All the currency pairs are currently, since the beginning of the year, on a massive trend move well out of previous channels, even the EUR\GBP, which is a great ranging pair, is hundreds of pips above last year’s channel. So, you have to have price return enough from a peak to create a temporary equity bump up, and then close everything, causing you to lose almost all profits, draw new channel limits, and hope the price stays within there for the next year. Even EUR\CHF has woken from 2012’s central bank intervention.
There was this comment posted by the originator of the system in another thread. Hope we can consolidate discussion here.
Thank you for your kind compliments Frawan, I appreciate it !!. I really don´t know if my system is “The holy grail” in trading and as Cyco says,then it´s a bit different. The basic principles are very simple really, in this way it is similar to a regular channel. The big difference is that a channel has got borders, this system doesn´t due to the hour-glass formation. As I can see then the people which replied here are experienced traders, so I will not go in details as you can see those by following the above link. When I say that, I don´t know if it´s the holy grail , it´s because I have publicly challenged anyone to break the channel. Several have tried but not succeeded, I myself has tried for a couple of years now also, but I can´t find “the weak link” . Some of the people which tried, to break the system were pro-traders, maths professors ( the whole system is based on maths ) and also a broker. The system is basically a volture, looking very innocent in the beginning, but it turn 2.000 usd into 384.000 usd in 500 steps, which should take around 2 years. The channel Frawan mention is now at step 178, so 322 steps to go. The oldest channel is running since 4 years and is now at step 900. I basically introduced this on eToro , because some traders asked me if there wasn´t any more safe way of trading, as they had lost a lot. So I did so in April last year. It wasn´t meant to become almost “cult” as it is now, with lots of traders adapting the system and thousands of copiers, just after 9 months. So far nobody have lost with their channels, which now has been named “Greenland” . As I said then I can´t guarantee it´s fool proof , but untilnow I have to assume it is. So anyone here which can find any flaws or weak points in the system , I would appreciate very much to hear from you. I wish everybody a nice and relaxing weekend !.
Thank you for your evaluations of my system. I do appreciate your comments.
I must stress though that, I didn´t say it was fool-proof, I said that noone have been able to break the system yet.
Firstly what you have read so far about this system , is just the tip of the iceberg. There´s a lot more info on the FB group page.
Pipsompounder, it might seem like a grid system, but that´s just the basics of it, it is much more advanced than that, when it get close to the borders.
Richard87 Thank you for thinking that I do this for some guru bonuses, first of all I don´t need those bonuses, but I can´t help that other traders copy me. On the FB page you will also notice that there is a board of Greenland traders ( the name of the system) and that there now are countless traders trading this system, and thousands of copiers. If I was there for the bonuses, I would not teach so many the system and even recommend them to uncopy me when they feel they have learned enough to make their own channel.
I do appreciate critics if it is for the right reasons and not based on assumptions. So join the open challege and break the system. I am also interested in this, as I can´t and several mathematicians and brokers, not to speak of a lot of pro-traders have tried and fiven up.
There must also be a reason why it´s the hottest topic on eToro and that noone so far have lost , using the system!.
So if you wish to evaluate, then get all the facts first. My channel at eToro is a tutorial channel, I don´t need it for bonuses nor profits as I do have several channels running, I simply just try to help traders to find a safer way of trading. Nothing else…But have a look at the reactions from traders using this system and also the more detailed info on the FB group page guru.viking1961 .
I wish you all a nice and prosperous week !
Will you be kind enought to explain rule no. 2: “Step 2. You will for the first 56 steps of the 500 steps in this channel ONLY trade with 40 usd x 25 (400 pips)”, specifically on “trade with 40 usd x 25 (400 pips)” means.
I think that would be a trade of 40 usd using x25 leverage, then 400 pips would be the SL (which seems to be mandatory for now on etoro, so that’s why some instructions might be a little confusing, but It can be used on any broker without need for SL).
But am still a newbie to the system so might be good to let some more experienced traders answer your doubts or ask on its FB page.
I stay rather quiet on this forum although i keep up to date with a lot that goes on so firstly hi all,
Grid systems have been spoken about a lot, and I believe they work, I am an end of day trader… and automation EA trader,. Through math they work, but the only adjustment I would make to grid trading is that it opens the first orders either in mid channel, or at 50 levels on stochs or RSI doesnt matter which way… Just as long as it doesnt start of at the bottom or top of the range.
Looking at it from a math point of view it would be easier to make profit from having both orders open like normal but when target is hit say buy target takes 50pips, the sell would close on 50% retrace, meaning its out of the trade but profited overall. This simple adjustment makes a big difference to results. Due to the high probability of getting a 25 pip pull back, especially within the asian session.
Secondly to increase the Grid distance to 100 pips adds lower DD.
