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I'm looking for a gap trading robot (Friday close - Sunday evening open) which I can use to strategy test various parameters. I tried one called Gap Trader v4 but it did nothing (probably had trouble deciding when the new week market opened). Couldn't find anything about gap trading in the search box.
This is a highly profitable trading method, as least according to my manual back tests e.g. only one loss in GBPUSD over 10 weeks, SL 100 TP 40 (in most cases profits greatly exceeded 40 pips, but, mustn't be greedy...).
It seems that gap size is not relevant to results - I've had gap sizes as low as 1 pip and still had (on paper only) huge profit, and gap sizes of 30 pips which were losses. There have been results in trending & consolidated markets, but there must be something which determines price direction related to gap direction (apart from The Holy Grail system!)
I would also appreciate a link to some detailed instructions on the correct way to strategy test and optimise a currency pair using MT4.
pls let me know if there is any improvement we can make together
Hi Doshur,
Many thanks for replying and thanks for including your robot (ignore my comments on the page you sent me the for - I was confusing your EA with another one)
I ran your robot on GBPUSD H1 for a 6 month period and it only had two trades, with a massive drawdown of $5800 and a huge profit of around $5900! Not much good if the drawdown comes first!
No matter how I change the imiput parameters I only get two trades.
1) Is Gap Range the maximum or minimum gap? I have manually had good results from any size gap. I changed the GapRange to 50 and still only got two trades. I'll try and include the pics though I can't seem to also include the graph.
2) Why do you call it sl/tp factor - are those sl/tp values in pips? Will your EA tell whether my broker is 4 or 5 decimal places?
3) How does your EA know when the last trade has ended on Friday and the first tick starts on Sunday? Does your EA read my chart time or computer time? I'm currently GMT + 1 here in the UK. My broker is GMT + 2.
Please check the Sunday spreads when you are thinking of trading the gap.
Hi Kenny,
I back-checked Sunday opens for the past 10 weeks and found that I had profits with 1 pip & 30 pip gaps, also had losses with the same range, so at least based on the limited data I had, gap size doesn't seem to be that important, unless someone has data to contradict my assumption.
The main thing is the greater number of wins to losses, especially with the GBPUSD, which in ten samples had only one loss. I used SL=100, TP=40 = 300 pips profit, which, if you also trade more than one pair (assuming your account is big enough), will increase the pips. It's purely a numbers game!
Hi Doshur,
Many thanks for replying and thanks for including your robot (ignore my comments on the page you sent me the for - I was confusing your EA with another one)
I ran your robot on GBPUSD H1 for a 6 month period and it only had two trades, with a massive drawdown of $5800 and a huge profit of around $5900! Not much good if the drawdown comes first!
No matter how I change the imiput parameters I only get two trades.
1) Is Gap Range the maximum or minimum gap? I have manually had good results from any size gap. I changed the GapRange to 50 and still only got two trades. I'll try and include the pics though I can't seem to also include the graph.
2) Why do you call it sl/tp factor - are those sl/tp values in pips? Will your EA tell whether my broker is 4 or 5 decimal places?
3) How does your EA know when the last trade has ended on Friday and the first tick starts on Sunday? Does your EA read my chart time or computer time? I'm currently GMT + 1 here in the UK. My broker is GMT + 2.
Cheers,
Mike
1. The Gap is in Pip size
2. TP and SL Factor is using ATR to calculate so if you input 1, it is equal to 1 X ATR value
3. my broker is alpari uk, 5 digits
The funny thing is, there is no gap in forex.. Just most Brokers that open late.
Hi GY,
If you look back to the past 10 weeks GBPUSD on a daily chart, at the difference between Friday close and Sunday evening open you will see a gap, sometimes only 1 or fewer pips, sometimes 30 or more. Using your cross hair, see how many pips you can make in the opposite direction of the gap (working on SL 100, TP 40 or more), before your stopped out. If the gap is up, sell & vice versa.
HI Doshur,
"1. The Gap is in Pip size
2. TP and SL Factor is using ATR to calculate so if you input 1, it is equal to 1 X ATR value
3. my broker is alpari uk, 5 digits"
Thanks for the info, though I would appreciate a little more clarification on how I can convert ATR values to pip values. Would it not be possible to specify SL & TP in pips insted of ATR?
I did a Strat Test from 1st Sept - 16th Oct using the following inputs:-
Gap Range = 2
SL = 10
TP = 4
(GBPUSD M15)
Net profit $773
Questions:-
1) I input risk of 0.1 yet the results showed all trades were taken with lots 0.32. Can Risk be changed to lots value?
2) It also put on mid-week trades, not just Sunday trades.
3) It missed e.g. a trade on Oct 5th, with an 18 pip gap (input gap 2).
5) All the losing trades were BUY trades that went the wrong way. All SELL trades went in the right direction i.e. opposite to the gap direction.
6) How does it decide which direction to go in? Gap trading should be in the oopposite direction to the gap, yet some trades went in the same direction. But, if we can find out why all the wrong trades were buy trades, maybe trading opposite to the gap direction isn't so important.
When I did the Strat TEst opver 7 month, the results were -$1888,
As it stands, ATR factor is not very useful to me, as I can't quantify what the SL & TP will be in pips. Would it be possible to change SL TP to a pips value?
I would welcome your comments and suggestions please.
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