Structure Based on Predefined Levels (Price Grid)

Grid trading operates by placing orders at predefined price levels, spaced either equidistantly or customized, both above and below the current market price. Each level represents a point where the system will execute an action (opening a buy or sell order).

  • Grid levels:
    • The intervals between levels (grid spacing) can be defined in pips or as a percentage of the price.
    • The spacing affects risk and reward: tighter grids generate more orders and potentially higher profits but increase the risk of overexposure.

Automatic Order Placement

One of the main peculiarities of grid trading is that it doesn’t rely on predicting market direction. Orders are placed automatically at grid levels based on price movement.

  • Types of orders:

    • Buy Stop or Sell Stop: Used in trend-based grids, where assets are purchased during breakouts.
    • Buy Limit or Sell Limit: Used in range-based grids, where positions are opened during pullbacks.

  • Grid symmetry:

    • Grids can be symmetric (with equidistant orders above and below the current price) or asymmetric (concentrated more heavily in one direction, e.g., only upwards or downwards).

Independence from Market Prediction

The grid system does not require detailed analysis to predict market direction. Its peculiarity lies in the ability to generate profit by leveraging natural price movements, whether the market is ranging or trending.

  • Ideal for range markets: In a ranging market, the price oscillates back and forth, allowing the system to close many positions in profit.
  • Adaptable to trending markets (if configured): With dynamic grids or specific settings, the system can be adjusted for trending conditions but requires careful management.

Progressive Order Accumulation

The system accumulates positions as the price moves along the grid. This is a key feature but also a potential risk.

  • Implicit “Martingale” effect:
    • If the price moves in one direction without reversing, the system keeps opening orders against the market direction. This increases exposure and risk.
    • However, some systems use dynamic grids to reduce risk in trending markets.

Profit Generation from Small Price Movements

Grid trading is designed to capitalize on small price movements (pips). Each time the price reaches a grid level and reverses toward the previous one, the system can close positions in profit.

  • Incremental gains:
    • Generates continuous profits by partially or fully closing positions along the grid.
    • Even minor price oscillations can result in profitability.

High Customization

Grid systems are highly customizable, allowing traders to adapt the strategy to different market conditions and trading styles.

  • Configurable parameters:
    • Distance between levels: Wider spacing reduces the number of open orders but lowers profit frequency.
    • Lot size: Can be constant or increase (Martingale strategy) depending on configuration.
    • Maximum number of orders: Limits the risk of overexposure.
    • Order types: Grids with pending orders (limits and stops) or instant execution.

Intensive Margin Usage

Grid trading requires significant margin to maintain multiple open positions. As the price moves along the grid, new positions are opened, increasing margin usage.

  • Leverage effect:
    • Leverage amplifies both profits and losses, and excessive margin usage can quickly lead to a margin call.
    • It’s essential to calculate the required margin in advance to avoid overexposure.

High Drawdown Potential

A major peculiarity of the grid system is its tendency to accumulate high drawdowns when the market moves in one direction without reversals.

  • Inherent risk:
    • The system continues opening “losing” positions while waiting for a reversal.
    • Without effective management, drawdowns can become unsustainable.

Individual vs. Collective Order Closure

A grid system can operate in two main ways to close positions:

  • Individual closure:
    • Each position is closed individually when it reaches its take profit level.
  • Collective closure:
    • Some systems close all open positions at once when the overall profit of the grid reaches a predefined target.

Market-Specific Conditions

The grid strategy is not universal and performs best under specific market conditions:

  • Range-bound markets:
    • The grid excels when the price oscillates back and forth within a range, closing many positions in profit.
  • Trending markets with regular retracements:
    • It can be adapted for strong trends, but only if there are frequent retracements to allow for profit-taking.

expert instructions ondeBOT

Expert data session

by inserting the expert in the graph the properties appear

Expert data session

You can always enter your settings in the data session

Disclaimer

This alert reminds you that trading is a dangerous job and by activating the expert you are the only one responsible.

First expert start

By accepting the disclaimer the expert activates and opens the first two operations very close to each other

explanation data session

This setting is very important

explanation expert start

Technical data on operation

data visible on the expert

The data visible on the expert are used to check if everything is going well

Reset time

resetting everything is important to keep everything clean

automatic and manual

manual operations can be performed, but always work on time frame h1. There is no option in the settings, you will have to close the positions yourself

Recovery system