Hi everyone,
My first post here, so excuse me if this has been answered before. I have made an attempt to find the answer to my question but haven't been able to do so.
I'm currently running an expert advisor I built myself on a few demo accounts (with different parameters) as well as on one live account. I have been running this particular EA for the better part of the past 9-10 months or so with positive results so far. It trades EURUSD and GBPUSD on the 1H charts mainly.
One area in which this EA does not perform well is when the market swings violently back and forth such as what happens after major announcements or news (e.g. today's FOMC statement). As it trades with a trailing stop-loss, this is what usually happens just after an announcement:
The EA is intelligent enough to set a wider stop-loss after each stop-out but this is usually not enough to prevent the subsequent stop-out. I've seen this hit 3 stop-outs rapidly after each other, and you can imagine what that does to the results...
I realise that I won't be able to prevent this behaviour fully, but I'd like to mitigate it. I was wondering if you would be able to share some tips on how to deal with anticipated high-vol situations such as news and announcements? I thought of the following alternatives:
What do you think? Which is more effective? Is there anything you suggest I should do instead?
Thank you in advance for any help
!
My first post here, so excuse me if this has been answered before. I have made an attempt to find the answer to my question but haven't been able to do so.
I'm currently running an expert advisor I built myself on a few demo accounts (with different parameters) as well as on one live account. I have been running this particular EA for the better part of the past 9-10 months or so with positive results so far. It trades EURUSD and GBPUSD on the 1H charts mainly.
One area in which this EA does not perform well is when the market swings violently back and forth such as what happens after major announcements or news (e.g. today's FOMC statement). As it trades with a trailing stop-loss, this is what usually happens just after an announcement:
- Stop out current trade with a loss
- Enters a new trade in opposite direction
- Trade #2 stops out due to continued swinging
- And so on...
The EA is intelligent enough to set a wider stop-loss after each stop-out but this is usually not enough to prevent the subsequent stop-out. I've seen this hit 3 stop-outs rapidly after each other, and you can imagine what that does to the results...
I realise that I won't be able to prevent this behaviour fully, but I'd like to mitigate it. I was wondering if you would be able to share some tips on how to deal with anticipated high-vol situations such as news and announcements? I thought of the following alternatives:
- Simply exit the trade before an anticipated announcement and resume trading afterwards
- Massively widen stop-losses just before the announcement and re-tighten them afterwards
- Enter an equal and opposite trade to hedge the movement, ignore SL levels and then exit this hedge afterwards
What do you think? Which is more effective? Is there anything you suggest I should do instead?
Thank you in advance for any help
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