hi everybody Alex du Plooy from Expert4x and in today's video we're going to be talking about grid
trading and this most fantastic method of trading the forex market with the least amount of tension
or pressure now when i started trading the market i traded various techniques but what invariably
happened a lot was you i would try the breakout of a support area it would break out beautifully and
then just reverse and the transaction would obviously go negative or i'd trade another
breakout it would go nicely and then come back and take my stop and then go all the way to where
i intended it to go and you can see lots of these examples breakout coming back breakout beautifully
positive look at that and it it shoots straight back so so i'm showing you a few examples of
breakout trades but the same would apply to bounce trades and it used to drive me absolutely bananas
when this happened i hated having losing trades absolutely so i channeled this hatred of losing
trades into a technique where you don't have any losers and let me show you how that happens so
this is the same chart i showed you previously and all i did is i divided it into a grid now
these are all grid lines that you see on the chart and they basically equal distance from each other
and i made up this system that i don't care which way the market runs i would have successful deals
all the time so how do you have successful deals all the time okay so let me show you so i created
the system called grid trading dividing the market into those levels and what i had created
were two rules very easy rule one is when you add a particular grid level you enter a buy and a sell
now firstly you are guaranteed to have a successful deal the markets are either going
to go up or down and that is why i entered the buyer itself but at every single level so i would
enter buying a cell at one grid level if it goes up i'd enter another buy and sell at that level
if it goes down again the same thing and no matter what price action happens you just enter buys
and sells at each level so that's rule number one very simple very simple if you just think about it
you're guaranteed to have a successful deal so rule two is and that follows on on what
i've just said you cash in your positive deals as they reach the next grid level so
using that example before you enter buying a cell the buy would go positive as it reaches the next
grid level and you cash it in then it comes back here and it reaches another grid level
and you cash in the cell that was successful and you just leave the uh the others open
and i'll show you why you leave them open and yeah the these two movements are our power movements
they are the ones which create a lot of wealth these particular movements where the price goes
up and down or goes up uh twice as much as what it goes down those are really powerful
movements but there are other ones which we use in great trading so let's apply those two rules
and uh let's say we bought and sold at the first level it went up we bought and sold again and we
cashed in the buy and then it went down to this the same level the same grid level as before so
what would have happened is we would have cashed in one by going up cashed in one cell going down
but this there would have been an open cell remember we had a binary cell here the open cell
yeah but because it's at the same level this that cell would have a profit figure of zero and there
would be a buyer that that is still open and that buy and for argument's sake i'm taking grid levels
grip gaps of a hundred just to make this uh illustration a lot easier of a hundred pips
okay so we've cashed in 200 pips we have one open deal that's -10 100 and the other one is zero we
have mysteriously made a gain of a hundred pips fantastic all right so let's move on to the next
one so the exactly the same thing buy buy buy and sell buy and sell buy and sell and then
it goes down here we cash in the buy as it moves from there to that's a positive transaction then
we cash in the next buy positive transaction and then we cash in the cell that goes back to that
particular grid level so at this point we will have cashed in one two three times so there's 300
or 300 pips and we have three open deals the one being the cell here that is at the same level so
it's zero there's the cell over here that is now a minus 100 and there's the by up here that is
also minus 100 if again if you add it all up together minus 100 minus 100 is 200 minus 200
less the 300 positive cash ins suddenly again you have this 100 pip gain and you
don't care what happens on the chart as long as the price is moving in an erratic way so
that you can cash in on under those particular movements this explains the core of grid trading
it is when the price revisits a price level then there is a good chance
that it will be in a profitable situation okay here's a typical example of a chart and it is
exactly the same chart that i showed you right in the beginning this time i've traded it on a grid
basis and again we're just assuming a hundred hundred gaps they might not be that but i just
want to show you the principles involved here okay so let's start here right in the beginning
so they attached a grid level so that's a great touch number one then it went down there's grit
touch number two then it went down there touch number three and then it went up again
touch number four now that remember that's one of our power moves and that would be profitable at
that time and then from four it went down and up again so that is another profitable move and then
from there let's have a look i think i i missed a number there so we actually should change because
there should be a the seven should be there but let's just take it the seven eight nine another
profitable move from from 10 it went 11 12 that touched there so there's another profitable move
and then 13 14 15. another profitable move can you see how these formations repeat themselves over
and over again and just going through the shot i'm not going to bore you with the details but
there have been uh 79 moves in fact i missed one so it must be 80 times that the price has gone
from one grid level to another grid level and touched that grid level so there are
79 times that the the price has done that and sometimes you know with these spikes look at this
spike from 30 to 31 to 32 most probably within a few hours of each other you've cashed in and and
that formation alone is a nice positive formation now i'll you can pause the chart and have a
look at these formations but they just repeat themselves over and over again these profitability
formations as they go on so the period we're looking at years from the 7th of december
to the 22nd of january about a six-week period and let's have a look let's say we had started then
and we are now in in today's date and what would the situation be so as the price is at this level
the buyers and the cells will be equal so this will be zero they will however be at this level a
buy that hasn't been cashed in and there by and thereby and then i and there and
then there would be cells below the zero which sell their cell there and sell there and the
values of the losses would be minus 100 because that's how many pips it is away from the zero
minus 200 because that's how many pips and so on and so on and the same thing down here that's
minus 100 minus 200 and minus 300. so we have a situation where we've cashed in 79 times but we
have eight deals open at plus the two that you've just opened so we've had we've got nine deals open
and we've cashed in 79 times now you can see how much that is now um the other thing i must
really point out here is that we have gone through quite big trends here the uh if we
take that the start of the trade minus 300 up there so we've we've looking at a 800 per
trend 800 per trend up there and an 800 pip down there and now it's gone back into the body of of
the price movement but so i'm showing you trending markets and sideways markets at the same time so
let's have a look at the results so a year we on our cashed inside we've got a hundred
times 79 so that is and i'm just using dollars here but i it should actually be pips 7
900. uh we've got open trades and we've done that calculation i'll just go back for you so we've got
500 900 1200 1400 1500 1600 1800 and then 2 100. so we've got open trades that have a balance of
2100 it means we've made a gain of 5800 pips that's quite a big gain in six weeks of trading
that's a thousand pips a week that is exceptional and that's the kind of thing that comes out
of grit trading and just think about it we did that on autopilot because this is a system that
is so simple that it can be automated and that is what we've in fact done you can do it manually
using pending orders and that type of thing but certainly why do it manually if the robot
the trading robot will do it for you and it is such a simple system so what are the
critical success factors uh when trading grids firstly you need to use sideway currencies you
don't want ones that are going to trend uh 2 000 pips in one go that type of currency
and there are such currencies like the euro franc is a is a really nice sideways country so you let
sideways currencies your gap sizing should also be take into account the volatility of your currency
as well as the risk appetite that you will expose yourself to so what i what i mean by that
is that uh if the euro as i've shown you before has a gap of a hundred and the power new zealand
which is a much volatile currency you your gap sizes should take that into account and
should be a lot bigger so gap sizing is very important you control your risk with gap sizing
then the other aspect is regular cash-ins if you have too many open deals that can also
that can increase your risk of trading as well as the cost of keeping these open deals going uh the
brokers do charge overnight charges sometimes the owner charges are positive sometimes they
are negative but on the whole we don't want to expose ourselves too many overnight charges
and then the portfolio approach is very important you don't want to trade one grid
for your whole life and place all your risk on one grid you should be trading let's say
10 grids with different currencies different gap sizes that type of thing and i'll show you
examples of that and you should be trading it as a portfolio so that if one goes bad the others can
look after it and so on so those are the critical success factors portfolio trading
pruning regularly having appropriate good sizing and sideways currencies now we do have
in in this robot that i mentioned earlier we have plug and play versions where the currency is
already selected the gap size is already selected so a lot of that has already been done for you
and here are some results on live accounts these accounts have been traded on a live basis they
all started out as a 1 000 account and you can see the beautiful results that we've got and and
there are a few other robots in included here but the grit trend multiplies by far our most
robust ea and uh produces really really good results and even if you start using it on on index
trading yeah you can see one that's been running and uh it's it's it's really generated some huge
uh returns uh that's the that's the make money ea so it's not what we're looking at and and you can
see the grit trend multiplier again fantastic results that have come out of these ones these
were the ones were traded on a 10 000 account but it just shows the robustness of these particular
years if you choose the right currency the right grid size and these were in fact not pruned
at all they just played traded continuously over the period and i think this was about a
six or seven month period and here's an example of one of those accounts you can
see that it's almost 100 success rate slight and not not quite 100 and uh and that is sometimes
when there are spread spikes and things like that sometimes they spoil the 100 record um but this is
a real account and you can see how beautiful the equity chart is going up and it was trading the
euro franc and it is a 50 return over a period of two just over 200 days so you're looking at
a a very nice return at a reasonably low risk now as i mentioned previously we have automated the
group trading here is the grid trend multiplier while we call it a multiplier as you can see
every time the price visits the same grid level it cashes in twice and three times and four times
over and over and over again and that is why it multiplies the gains either even in a trend so so
i showed you earlier that there was let's say 800 per trend upwards and downwards and the
griton multiplier just multiplied the gains all the time even in a trending market but you don't
want to have a excessively strong trending market but a reasonably trendy market it can still handle
now if you want any further information about this uh fantastic ea please use the link that's
provided a clickable link will be provided in the commentary and in the description of the video
i hope you've enjoyed this video i hope it's given you the feel of what the potential is
of this particular ea i haven't covered other strategies like a one-way trading strategy
and there's a whole lot of other strategies uh pruning strategies that you can do but the basic
strategy that i've shown you now is actually good enough to make you a really good return
on your money and on your efforts the beauty here it is totally automated you don't have
to watch the screens you don't have to watch the charts and you want a lot of
irrational volatility in the market because you know that every time
the price touches a grid you are cashing in positively so for me unexplored cheerio
[Music]
you