Backtest for the robot can not be analys out as it
involves two different pairs. Only foward test.
Tho' most of the time
GU and EU ordinarily run in wheel, there are definite situations effort the
disposition of GU is opposition with the discernment of EU. When the pairs are
wiggly oppositeness, the signal of pips of motion to the wayward is called the
gap. We can save the activity when the gap for the movement in the paired route
between the GU and the EU is significantly bigger (extremum advisable gap is 100
Let say at the instance the 100 pip gap is
occurred, trend direction of GBPUSD is up and trend of EURUSD is down, then we
are considered to open position by selling GU and buying EU simultaneously (if
laxation of GU is downtrend and oppositely the front of EU is uptrend, we no
fear make buying GU and selling EU).
When GU and EU are source to move substantiate in twin message (or is said to
scalelike the gap), our ingenuous posts are believed to be in the profit
territory, and we should be out of the marketplace. To enveloping the gap from
old position which is GU is upwardly and EU is downward, GU staleness go down,
and the EU love to go up, or GU has to change feather substantially, or added
opening is the EU has to move up substantially.
Numbers of single lots advisable to be utilised for Pair 1 (let say GU, for
GU-EU couple) in the market are based on the ADR ratio between the two pairs. So
if we are using 1 lot for EU, then we imply to use 0.8 lot for GU.
Expert Advisor Concept
Unremarkably, a few of the forex instruments (symbols), so titled pairs in a
sheer language propose in finish with the another deuce. For lesson GBPUSD (GU)
and EURUSD (EU), often locomote in the unvarying itinerary. Still, both of them
move in the paired content much as EURUSD with USDCHF.
A twosome of pairs that move in the congruent itinerary is said to know a
optimistic reciprocity, patch couples propose in opposition substance are
negatively correlated. If we simultaneously follow the activity by buy long GU
and sell short EU at the identical clip, we were in posture of of hedging
locking or so called protection.
Though GU and the EU usually move in same line direction, its movement length in
pip between GU and EU is dissent. Mostly, based on the bypast records,
occurrence of GU is bigger than EU. In tell to balance the change of these pairs
in monetary worth, let say in the USD acceptance, we use the ratio of Average
Daily Range (ADR) between these pairs to ascertain the come of lots to be old
The normal ratio of ADR of the EU over GU in the phase of the subterminal 365
life is some 0.8. This capital, if GU moves in a day by 200 pips, the EU is
prospective to advise a whole of 160 (= 0.8 x 200) pips. To get a fitting
structure of equivocation in the USD, we use a smaller lot in GU. If we open
with 1.0 lot, then the traded lot for GU should be 0.8 lot, which is a lead of
ADR ratio (0.8) increase with traded lot in EU (1.0 lot).