Triple Top And Triple Bottom 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:
- Triple Top And Triple Bottom Expert Advisor For MT4
- The Triple Top And Triple Bottom Expert Advisor For MT4 – Entry Criteria
- The Triple Top And Triple Bottom Expert Advisor For MT4 – Exit Criteria
- The Triple Top And Triple Bottom Expert Advisor For MT4 – Room for Improvement
The Triple Top And Triple Bottom Expert Advisor For MT4 is an advanced algorithmic trading system for MT4 platform. It makes use of the principle of triple top and triple bottom but applies it in a different way. In this trading system, triple bottom is considered to have taken place if price is moving down creating a falling trend line and then rebounds a little to form a swing low. In the same manner, a triple top is said to have developed if price is moving up creating a rising trend line and then goes down a little to form a swing high.
When the robot is run in the strategy tester for a short period of time, the outcome was negative in terms of net profit. However, the robot shows promise as it gives interesting results. The drawdown is relatively small (around three percent), the profit factor is a little below one (0.91) and the expected payoff is just a little negative (-$0.14). While this trading performance means that the robot is not suitable yet for live trading, it gives the idea that this trading system is not bad at all. It might possibly show a different performance if testing is done in a different symbol, timeframe or market condition. Anyone interested to know the true value of this robot must do a longer testing in the strategy tester, preferably with optimization, or even demo trading.
The Triple Top And Triple Bottom Expert Advisor For MT4 – Entry Criteria
The Triple Top and Triple Bottom Expert Advisor for MT4 performs complex calculations to get values that can be displayed later as objects on the chart. These objects are the pairs of arrows and trend lines above and below price. These objects are plotted on the chart not only to inform the user but also to be used later in generating trade entries.
The up arrows mark the creation of short-term swing lows, while the down arrows label the swing high points on the chart for the near term. Meanwhile, the upper trend line connects two swing highs, and the lower trend line connects two swing lows. In this trading system, only the properties of the trend lines are being used in trade identification.
In generating trade signals, the robot checks if five conditions are in agreement. If any one condition is not true, no trade will be taken. The five elements of the trade criteria are the number of open trades, the trend of the moving averages, the momentum indicator value, the direction of the trend line, and the location of current price.
The technical indicators used in this system, their settings and usage are explained below:
- Moving averages (period 6 and 85, linear weighted, price typical) – The robot obtains the values of the LWMAs for the current candle on the next higher timeframe. If the current timeframe is 15 minutes, for example, the robot will take values from the 30-minute timeframe. If the six-period LWMA is above the 85-period LWMA, this is taken as a buy signal. Meanwhile, if the six-period LWMA is below the 85-period LWMA, this indicates a sell signal.
- Momentum (period 14) – This indicator is applied to the next lower timeframe, and the values needed for calculation are for the previous three candles. If any of the three values is less than 0.3, this element is counted as one factor into the trade entry equation. This momentum value indicates that the current trend regardless of direction is not exhausted yet, so a trade taken in the direction of the trend has a good chance of winning than losing.
Another consideration for trade entry is the number of open trades. The robot cycles through the orders in the trade pool to count market trades in the current symbol. If there is none or the number is less than the maximum limit set by the user in Inputs (default 10), the robot can execute another trade.
The trend line is a critical element for trade entry. For a long position, the trend line must be pointing down, meaning the previous point has a higher value, but the distance between the first price coordinate and second price coordinate of the trend line should be at most 10 pips for the signal to be valid. The opposite scenario for the short position will be applied in the same manner.
Lastly, the location of the current market price with respect to the second price coordinate of the trend line should be correct. For a long position, the ask price should be above the second price coordinate, while for a short position, the bid price should be below the second price coordinate.
If all of the five conditions above are satisfied, the robot will place a market order, buy or sell. This trade will have a lot size of 0.01 as defined in Inputs and comes with a stop loss of 20 pips and a take profit of 50 pips upon trade execution.
The Triple Top And Triple Bottom Expert Advisor For MT4 – Exit Criteria
As mentioned in the foregoing, the Triple Top and Triple Bottom Expert Advisor for MT4 uses stop orders (stop loss and take profit) to exit trades. If price hits the stop loss, a trade is closed in loss. If price touches the take profit target instead, the trade is exited in profit. However, the trading system also comes with the breakeven and trailing stop functionalities, and these are enabled by default.
The breakeven and trailing stop functions work in tandem to support each other, but they work only for profitable trades to ensure they do not turn around and become losing trades. First, after a profitable trade gains 30 pips, the stop loss of the trade is moved to breakeven to lift the risk off of the table. If the trade gains more pips at some point later, the stop loss is again adjusted to secure more profits. Trailing stop is done by the robot on every tick and occurs as frequently as possible until the market hits either the latest stop loss price or the take profit objective. Either way, the recently closed trade ends up in profit.
The Triple Top And Triple Bottom Expert Advisor For MT4 – Room for Improvement
The Triple Top and Triple Bottom Expert Advisor for MT4 is a promising automated trading system. While it does not show a positive result in testing with the default settings, the statistics look good. With a longer test run, the robot might show an entirely different result, especially if several parameters are optimized. This type of testing uses a lot of computer resources and very time consuming, but it will shed light into the true potential of this trading system. Once and for all, the testing will determine the combinations of parameters that will yield the best results if such is available.
In addition, some changes may need to be done in the program code. Though the robot does not look for a trade on every tick, testing shows that the robot can open a new trade on every new candle. As a result, trades are closely bunched together with very narrow gaps. If a trade cycle happens to be against the trend, the trades are short-lived and the account balance goes down very quickly. Therefore, it is a good idea to space out the trades properly, especially those of the same type. This can be added as one of the criteria for trade entry or when adding new trades. Adding a few lines of code is all it takes to put this concept into effect.