New Year Gift

Hello friend!

Greetings for the season! Hope you had a great holiday!

It’s a new year and we start the year with a bang! A free trading bot/indicator.

In this week’s experiment, we are implementing this video.

How the Bot Works:

The bot focuses on two EMAs- the EMA 9 and EMA 20. The bot relies on the price regressing to the EMA9 and using the EMA 20 as the SL.

BUY SETUP

When the price goes below the EMA9 and EMA20, we start buying. The ‘hope’ or ‘assumption’ is that the price will revert at some point and make money with the buy trades.

SELL SETUP

When the price goes above the EMA9 and EMA20, we start selling. The ‘hope’ or ‘assumption’ is that the price will revert at some point and make money with the buy trades.

Coding this strategy raised a few concerns on my end:

1. The strategy doesn’t implement any form of risk management. NO SL or TP was implemented in the strategy.

2. There was also an excessive amount of trades taken. I don’t see how this would work with a small account.

3. If the price was on trend, this would easily blow the account.

Overall, I made a few changes to try and add some form of risk management.

Modifications to the Strategy:

I only implemented the sell scenario and made 5 versions of the same strategy.

1. Modification 1 - Sell Limit: Instead of using the market execution of a sell, we use a SellLimit order with a flexible value in pips. This tries to mirror the original working of the bot.

   • Backtest Results:

     

2. Modification 2 - TP and SL: Adds a Take Profit (TP) and a Stop Loss (SL) at a risk-reward ratio of 1:2

   • Backtest Results:

     

3. Modification 3 - Volume Distance: Considers the distance between volume and EMA20.

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4. Modification 4 - Asian Market: Trades only during the Asian market and considers the level of the 200EMA.

   • Backtest Results:

     

Bot Inputs

• MAOnePeriod : The first EMA, default to 9.

• MATwoPeriod : The secondEMA, default to 20.

• MAOneAppliedPrice : The first EMA applied price, default to using the CLOSE.

• MATwoAppliedPrice : The second EMA applied price, default to using the CLOSE.

• MAOneMode : The first EMA mode, default to using the Exponential.

• MATwoMode : The second EMA applied price, default to using Exponential.

• MAOneShift : The first EMA shift, default to using zero.

• MATwoShift : The first EMA shift, default to using zero.

• distanceFromMAOneinPips : This sets a buffer in terms of pips to how far you need the price to move to for the bot to start placing sell limits.

• incrementalOpenTradesEveryXPips : This is the difference in pips between the sell limit orders placed .

• theMagicNumber : this is a unique bot identifier

• theLotSize : the volume

• maximumSellStopOrdersToBeOpen: maximum number of sell limit orders to be open at any one time

• tpPips : take profit in pips

• takeTrades : when set to true, the bot will place a sell limit order. When set to false the bot will not place a sell limit order.

• notifications : when set to true the bot will send notifications when a sell limit order is placed.

What's Next?

• All 4 modifications will be tested on a Virtual Private Server (VPS) for a week on a demo account. If you're intrigued and want to follow the strategy, join our Discord channel and look for the bot1 channel.

• Have a strategy you need to be coded? Work with me here.

Important Note:

• Please refrain from trading these bots live; consider using them as signals.

• Supervision is crucial, especially for this strategy, so all bots have the option to turn off trading by default.