Tue Mar 20, 2018 10:24 am
The NTK Expert Advisor is a VertexFX client-side script built upon price breakout technique. It is based on the idea that when a strong trend starts, the probability of this strong trend continuing is very high. Hence, trades opened in the direction of the trend have a greater probability of success and profit. This Expert Advisor capitalizes on this idea by trading in the direction of the breakout. It does not attempt to determine the direction of the breakout, but rather waits to trade in the breakout direction by placing pending orders in both directions.
When the Expert Advisor is attached to chart, it places a BUY-STOP and a SELL-STOP orders based on the NET_STEP, PER and CENTER parameters. The take-profit specified by the TP parameter is typically greater than twice the stop-loss defined by the SL parameter. This ensures a greater Profit Factor and results in higher overall profitability. The initial lot-size is calculated based on the SL, PERCENT and Account Balance.
After the initial STOP orders are placed, the Expert Advisor waits for a breakout in either direction. Once a pending order is triggered, the opposite pending order is deleted. Thus the Expert Advisor trades only in the direction of the trend. It does not open orders in the counter-trend direction.
Once a trade is open, the Expert Advisor employs a trailing stop – either using a fixed distance as specified by TRAIL_PROFIT or based on the Simple Moving Average based on USE_MA and MOVING_PERIOD. Similarly, if BE_ZUB is specified, then the trailing stop is moved to the entry price once the trade reaches a profit of BE_ZUB points.
The next pending order is placed in the same direction after the initial trade is opened. For example, if the initial trade is a BUY trade, then a new BUY-STOP order is placed at distance of NET_STEP points from this initial trade. The lot-size of the second order is MUL times the lot-size of the first order. This process is repeated till the MAX_TRADES number of trades is reached. Once this limit is reached, the Expert Advisor does not place new trades, and only manages the existing trades. Each position is closed either at the take-profit, or at the initial stop-loss, break-even stop or by the trailing stop. Finally, once the last trade is closed, the Expert Advisor starts over again by placing the initial BUY-STOP and SELL-STOP orders.
In the adverse scenario of the market changing its direction, the trades are exited at stop-loss. Typically, the stop-loss is half (or less) the value of the take-profit, so a smaller Win/Loss Ratio is sufficient to generate a superior Profit Factor.
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