Cascade ordering strategy base on mathematics and statistic

Summary

In this Eco Engineering video, host Chia leelipur introduces the Cascade ordering strategy, a mathematical and statistical approach to optimizing trade exits in Forex, crypto, and stock markets. The video is divided into three parts: explaining the strategy, demonstrating its programming in MQL4, and showcasing its performance through backtesting. The strategy involves opening new orders at the same lot size after hitting take profit, adjusting stop losses, and aiming for higher profits. The host emphasizes the importance of a solid entry strategy and responsible lot sizing for effective trading.

Takeaways

• 😀 The video introduces a unique trading strategy called 'Cascade ordering strategy' developed by the host, based on mathematics and statistics.
• 📈 The strategy involves opening new orders of the same lot size after hitting a take profit, shifting the stop loss to five points below the new order, aiming to compound profits.
• 🔢 The video is structured into three parts: explanation of the strategy, programming the strategy in MQL4, and testing the strategy's performance.
• 👨‍🏫 The host offers to teach viewers how to program the strategy in MQL4, suitable for those with no prior programming experience.
• 📊 The strategy is backtested using the Strategy Tester, demonstrating its performance over a specific period with a starting capital of $100,000.
• 💡 The Cascade ordering technique is not an entry strategy but a method to optimize exit points and maximize profit from existing trades.
• 📉 The strategy includes scenarios for managing losses by closing orders when the price hits the stop loss, ensuring risk management is maintained.
• 📈 The video emphasizes the importance of a good entry strategy, stating that the Cascade technique can only amplify profits if the entry strategy is already profitable.
• 📝 The host provides custom user-defined functions in MQL4 to check for new candles, count open orders for a specific symbol, and close all orders for a specific symbol.
• 📉 The video script mentions a scenario where even if the strategy is wrong in 10 trades, it can still make a profit due to the compounding effect of correct trades.
• 👍 The host encourages viewers to subscribe and provide feedback for future video topics, emphasizing the channel's focus on algorithmic trading strategies in Forex, crypto, and stocks markets.

Q & A

What is the main topic of the video by Chia leelipur?

The main topic of the video is the introduction and explanation of a new trading strategy named 'Cascade ordering strategy' developed by the host, which is based on mathematical and statistical principles.

What are the three parts of the video?

The three parts of the video are: 1) Teaching the Cascade ordering strategy and its mathematical and statistical basis, 2) Demonstrating how to program the strategy using the MQL4 language, and 3) Showing the results and testing the strategy's performance using a strategy tester.

What is MQL4 language used for in the context of this video?

In this video, MQL4 language is used for programming the Cascade ordering strategy, which is a technique for optimizing exit points in trading.

How does the Cascade ordering strategy differ from traditional order closing methods?

The Cascade ordering strategy differs by opening a new order with the same lot size instead of closing an order when the take profit is hit, and adjusting the stop loss to five points lower than the new order's entry point, aiming to capture more profits.

What is the purpose of opening a new order instead of closing the existing one when the take profit is reached?

The purpose is to potentially capture additional profits by maintaining a position in the market and allowing for further price movement in a favorable direction.

What is the significance of the 'new candle' condition in the MQL4 code?

The 'new candle' condition is significant because it ensures that certain parts of the trading strategy are executed only once per candle, which helps in managing the timing of order placements.

What does the 'symbol open orders' function do in the MQL4 code?

The 'symbol open orders' function counts and returns the number of open orders related to a specific symbol, which is important for managing orders and applying the Cascade ordering strategy correctly.

How does the strategy handle the closing of multiple orders when a stop loss is hit?

The strategy uses a custom 'close all orders' function to close all open orders for a specific symbol when the stop loss condition is met, ensuring a systematic exit from the market.

What is the importance of having a good entry strategy in addition to the Cascade ordering strategy?

A good entry strategy is important because the Cascade ordering strategy is designed to maximize profits and efficiently close orders, but it does not provide signals for market entry. A profitable trading approach requires both effective entry and exit strategies.

What was the performance of the Cascade ordering strategy in the backtest shown in the video?

In the backtest, the strategy demonstrated a profit of $12,175 with an initial deposit of $100,000, achieving approximately 12% return on the balance in one month, based on the parameters and conditions set for the test.