HI Everyone,
I have wiritten a ea for myself and I am looking a bit of advise regarding the trailing stop.
The ea trades on the 1 hour chart, when a trade is opened, it gets a stop loss of 60 pips and a take profit of 100 pips. The trailing stop moves the stop loss 10 pips at a time as the price goes in favor with the trade.
My question is, the initial TP and SL for a 1 hour chart ok and is the trailing stop moving in 10 pip steps a goood setting?
My main concerns is the price moving in the right direction for 60 pips, reversing and just breaking even, which is better than a loss yes, but I want to save some pips.
All comments and suggestions welcome.
Fixed point stops are rarely the best idea. Market conditions at the time of entry may mean that tighter or looser stops should be employed.
What about using the Parabolic SAR and setting the initial SL and trailling stop to say the SAR level 2 bars ago?
Would this be an effective SL
Couldn’t begin to say. It depends on whether the SAR has any meaningful linkage to the types of trades you’re trying to make. Testing is advised.
There is probably not one set of settings/targets that will work the same with every instrument, so you will possibly need different settings for each one.
A good way to get a feel if the settings are correct is to first back test to give you a number of suitable settings, then forward test with those settings to see what works and what doesn’t.
Whilst yes you want to get pips, with auto trading the most important factor (IMO) is protection of capital and a low drawdown. Much better to protect the capital and trade again another time, rather than try to squeeze some pips every time.