The Newgrid Expert Advisor

A little bit more than a month ago I decided to do a little experiment in coding and automated trading systems which came to my mind after a lot of discussions with people using the Robominer and GT-Shadow trading systems. I have to say that even though I went to the Robominer forum with nothing but the good intention to discuss their trading systems and the reason why I believe their trading methodology was seriously faulted I was first recevied with insults and then I was treated with demeanor, like if I was an 8 year old who had no idea of what he was talking about. Of course, this is the reason why I stopped wasting my energy on discussions about that trading system and decided to focus my energy otherwise.

My idea was simple, I wanted to create a simple trading tool that could be used for grid trading and that would be absolutely free to use. My intention was not to take customers off the hands of the people of Robominer or anything similar but I wanted to show that there is in fact potential in grid trading but that it must be done responsibly to exploit a range by a trader who really understands what he or she is doing, not simply by putting it up as a “set and forget” system which is something dangerous and that should NOT be done.

The result I came up with is the newgrid EA. This automated trading system trades a custom grid designated by the trader on any currency pair the trader wants on any range the trader wants. Since the idea was to make this free and very easily available, I decided to post the result of my work in a forum, specifically here, at forex-tsd. You can see that the EA shows 10 year profitable results on the EUR/CHF, like Robominer. However, this result is totally irrelevant since the range used was known when it was not, that is, the system uses the benefit of hindsight. This is a characteristic shared with the Robominer system, had I defined the range on the EUR/CHF based on 2000-2002 data you would have wiped your account in 2004 or 2007 due to the range extensions. However the newgrid EA code is much more efficient with a backtest taking about 10 minutes while robominer can take anywhere from 2 to 3 days.

I wanted to publish the EA on a forum to see if anyone was able to show a profitable use of the system under a responsible and selective eye. I wondered if I could have some examples of people taking profits from user defined ranges and then taking the EA out when they deemed necessary. However this never happened and I believe that despite my many many warnings, people are using this just as if it was in the likes of Robominer, to trade EUR/CHF and AUD/NZD ranges in the long term, when this will certainly cause an account wipeout in the long term.

The newgrid EA is a trading tool for range trading and it is NOT a long term profitable expert advisor. As I say on the forum, any attempt to use this EA for long term profitability as a “set and forget” strategy will likely wipe your trading account. After all, ranges don’t hold forever and you would have to be naive to think that a range on the AUD/NZD will hold with AU raising their interest rates and NZ doing nothing. This is just basic economics, the fundamental factors are not the same ones that 2 or 5 years ago and the ranges will break, both on the AUD/NZD and the EUR/CHF. It is not a matter of if, just a matter of when.

If you would like to learn about automated trading strategies that are in fact long term profitable and that show profits from 2000 in backtesting without any hindsight or manipulation please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article !

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