Overlay pair indicator.
Some pairs are predefined. If you add the indicator over EU or GU automatically the indicator uses the other, for example, on EU it uses GU, and for GU it uses EU.
Default to Line chart, you can configure for candlestick chart.
Tested on 1M, but should work on any time frame.
overlay.zip (10.1 KB)
Did u make it yourself? Because I used everyone I could find online. Overlaychart yrr and mt4correlation, ect ā¦ ect ā¦
I got one from the internet, and modified it because it repainted a lot, now it seems to be useful without repainting for 7200 periods (about a week in 1 minute view)
Ohhā¦ I just compared the results of that indicator with the tecnique of vitrite, and the results are very different!
Make sure you use two mt4 programs from the same broker.
Yes, Iām using two instances of MT4, same screen resolution, same everything except pair (EU and GU)
I placed GU in background with red color and EU in foreground with vitrite and in green color. I also placed the overlay indicator, and it is very very different from the GU chart.
Yup sounds right to me
If you place 2 windows, one with EU and other GU, and you have a line indicating the price on both pairs, that shows only the latest price, is it possible to measure the difference between both BID lines and to trade them, without the transparent window effect?
Kelton,
If a trade is opened with all the recommendations you have provided. Would this trade be profitable ā[B]WHENEVER[/B]ā both the prices come together?
For example I open a trade of EUR/USD and GBP/USD when there was a 20 PIP difference and donāt close the trade as in hours time the price was not touching each other. I chose to leave it run and walk away till tomorrow morning. Would it be profitable āwheneverā the price come closer to each other of the pair?
I would assume, this being a hedge it should be profitable as long as the prices are touching each other even if the trade was closed after few days.
What do you think?
Cheers
Pat
Sorry if Iām being a little dense here, but as a previous poster has pointed out, how is trading EUR/USD and GBP/USD using this method different from just trading the EUR/GBP? If a gap opened because EUR/USD went up and GBP/USD went down, isnāt that the same as a move up in the EUR/GBP chart?
Hi, I think the problem with Overalys indicator is that it doesnt āresizeā according to the height of the window, as normal price action does, If we could make an indicator that resized the sample to % of for excample 500pixels both, then it should work, and also be wery easy to create an EA for it (from now on my pet project 
)
[EDIT]
I found that my Overlay indicator from ICTās work works pretty well 
Check out this:
[EDIT Again] The indicators name is OverLayChart-MAwally2
Hi, I think the difference is not that you bet that the price will rise or fall, your betting that the price will be correlated and meet up 
Wich it has a wery high probability to do
Can you please post the over lay indicator that you are using? Thanks PC
Hi, I only have the compiled version of this, here is the link
http://dl.dropbox.com/u/19108245/OverLayChart-MAwally2.ex4
[EDIT]
hi, I am wondering what to do when the price crosses and moves apart, but does not return so I can close the trade, when do I cut my losses?
for example 16. January last year the price crossed, and I would have bought, but on this occasion the price didnt touch for the next 280 days approximately, and on the biggest move had a pip difference for 1700pips(at least from my indicator).
So your plan is when the Equity drawdown is 3% cut your losses? And Im calculating my lot size after how much I expect to make on the trade, for example 20pips / 2% of equityā¦
Richard87 how was your chart set up to see that 1700 pip difference? What time frame, zoom level, and overlay Method did you use?
WMaraud you would have two positions hedging eachother in a way and if you were to just trade eur/gbp like any other pair you would not be using start arb and would need to find a profitable strategy just as if you were trading eur/usd. Which is difficult to say the least .
Hi, I was zooming all the way out on the daily timeframe to see correlation over a major timeframe, I am unsure how that would work in 1min since the scale āresizesā to match the highest high and lowest low for both pairsā¦
(I was using the indicator from my last post)
But Im guessing my real question is when you cut your losses, a after a 3% drawdown? and how often do you add to your trade? every single 20pips, or just the first 4 for excample 20,40,60, 80 pip difference?
[EDIT] Just wanted to say that I made my first trade using this system today, and it was a winner 
with 0.01 Lot size My prize was 1.5$ Demo cash
Hi Kelton, first of all thank you for sharing this amazing idea.
I just have one question: how does your broker look at this strategy? As Iāve heard they are all very against the form of arbitrage when you compare price feeds from two different brokers (on the same pair) and some state in their conditions that they do not allow āany form of arbitrage tradingā. I guess NDD brokers shouldnāt care about that, but market makers could use this against you and decline withdrawal?
Have you tried to withdraw any profit you made using this strategy?
Thanks for the answer.
Iām using a max dollar loss to close the trade. If the trade is in loss more than 6 % of my account, then I close all the trade.
Iām calculating my lot size based on an āmax pip lossā of 100 pips for each trade, that is, 300 for EU and 300 for GU.
I think it is not important this, because if a broker sees with bad eyes this strategy, simple use two brokers, and you place one trade on one broker and other trade on other broker. Or maybe two accounts with the same broker.
But there are brokers that allow full hedge, so this āpartial hedgeā strategy is not a problem with them
