CCI Expert Advisor For MT4
WE IMPROVED THIS EXPERT ADVISOR FOR YOU!!!
PLEASE NOTE: This expert advisor was publicly available for free usage on other websites and is not programmed by us. We explain the functionality and possible improvements of the EA. Furthermore, we are convinced that fully automatic Expert Advisors will fail in the long run. On the other hand, our semi-automatic approach with detecting the best setups and then activating our Expert Advisors (e.g. V-Power EA, EdgeZone EA) produced many successful traders and some of them even got prop traders at prop trading firms. Therefore, we added a similar semi-automatic trading feature (to allow only buy or only sell trades) to the free Expert Advisors. You can download the modified version here and enjoy!
Table Of Contents:
- CCI Expert Advisor For MT4
- Trade logic of CCI Expert Advisor For MT4
- How to trade successfully with the CCI Expert Advisor For MT4:
- Calculation of CCI indicator
- CCI Expert Advisor For MT4 settings:
- CCI Expert Advisor For MT4 - Limitations and recommendations:
- CCI Expert Advisor For MT4 - Conclusion:
If you are looking for an oscillator based expert advisor to complement your trading strategy. Then the CCI Expert Advisor For MT4 can be instrumental. The expert uses a native MetaTrader indicator and provides very few variables for its core entry and exit logic. The expert advisor's simplicity allows the trader to understand the expert advisor and trade along with it.
Trade logic of CCI Expert Advisor For MT4
CCI Expert Advisor For MT4 uses a native indicator of Metatrader, the commodity Channel Index Indicator (CCI). CCI measures the deviation of the price from its average value.
Traders can use the Commodity Channel Index to trade two different types of trading strategies. The first one is the Convergence and Divergence trading strategy. The next one is to use the overbought and oversold values of the indicator.
Divergences and convergences appear if both price and the indicator values fail to sync with each other. When the price makes a higher high, the indicator should also make a higher high. Failure to do so will display a convergence or divergence based on the context.
However, traders should note that CCI Expert Advisor For MT4 does not trade the divergences and convergences.
Any oscillator's key role is to identify the overbought and oversold conditions of any given trading instrument. Being an oscillator, the Commodity Channel Index does the same. It measures the values and plots the values in the range of ±100.
A value higher than +100 indicates an overbought condition. It indicates the possibility of the prices to retrace as the bullish trend is weakening. On the other hand, the oscillator values lower than -100 indicate a waning bearish trend and an impending reversal.
How to trade successfully with the CCI Expert Advisor For MT4:
Picture A: Trading using the CCI Expert Advisor For MT4
The expert advisor enters the market only if it identifies an overbought and oversold condition. The expert advisor places a BUY order if CCI values go below -100 and then crosses above it. The expert advisor validates the crossover upon a candle close.
The expert attaches the take profit and stop loss values as per the input in expert advisor parameters. The expert advisor can calculate the lot size automatically, based on the risk allocated by the trader. However, the option to trade fixed lots is also available if the trader decides to do so.
The expert advisor can trade all timeframes; however, it is recommended to trade in higher timeframe charts as oscillators are sensitive to price movements. The expert advisor tends to trade more often in lower time frames.
The settings' simplicity is well suitable for new traders; however, experience trades will prefer to trade based on the oversold and overbought levels. CCI Expert Advisor For MT4 is capable of trading all types of trading instruments.
Calculation of CCI indicator
The Commodity channel Indicator or the CCI forms the basis for the trading signals of this Expert advisor. The CCI values as calculated by the following steps.
The basis of the indicator is the Typical Price. The typical price is calculated by adding HIGH, LOW, and the CLOSE prices of every bar and dividing the result by 3.
TP = (HIGH + LOW +CLOSE)/3
The next component of the calculation is N. The n-period Simple Moving Average of typical prices is calculated by
SMA(TP, N) = SUM[TP, N]/N
The value is derived by subtracting the received SMA(TP, N) from Typical Prices.
D = TP — SMA(TP, N)
The n-period Simple Moving Average calculates the absolute value of D.
SMA(D, N) = SUM[D, N]/N
The SMA(D, N) is multiplied by 0,015.
M = SMA(D, N) * 0,015
The final step of the calculation is to t divide M by D.
CCI = M/D
SMA: Simple Moving Average;
N: number of periods.
CCI Expert Advisor For MT4 settings:
Picture B : Expert advisor settings.
The expert advisor provides the following parameters:
Fixed Volume Size: Fixed lot size to trade.
Volume based on risk: Automatic lot size calculation based in the risk.
TakeProfit in Points: Take profit in pips.
Stop Loss in Points: Stop loss in pips.
Max Spread in points: Max allowed broker spread to place the trades.
Expert ID : Magic number for the trades placed by the expert advisor.
CCI Expert Advisor For MT4 - Limitations and recommendations:
Most forex traders use oscillators not only to find oversold and overbought levels. Traders tend to follow the oscillator to ride the trend and continue to hold positions until it reaches the other end. Traders entering the markets on oversold levels will continue to hold the position and try to exit at the overbought level.
CCI Expert Advisor For MT4 does not follow the oscillator to exit. The expert advisor exits the trade only at a take profit or stop loss. Many new and experienced forex traders will benefit if the expert advisor exits using overbought and oversold conditions.
The expert advisor uses the standard commodity channel index indicator of MetaTrader, but it does not plot them in the charts. It would be useful to traders if the expert advisor plots the same.
Successful forex traders use multiple strategies to trade the forex market. The expert advisor does not provide trade alerts to the trader at opening a trade or closing a position. The alerts can be helpful to the traders to enhance their trading experience.
CCI Expert Advisor For MT4 - Conclusion:
Trading using CCI can be beneficial. At the same time, it requires extensive research and understanding of the currency pair's properties used to trade. Chart time frames play an important role. Most of the success is attributed to the selection of time frames. The CCI Expert Advisor For MT4 provides the necessary input parameters for the expert advisor to function automatically. Still, they need to be validated by the trader before using the expert advisor.
For successful trading, the trader must manually validate the expert advisor's entry signals and then confirm it at the trader's discretion using price action. This additional confirmation of price action will increase the possibility of success.