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Trade
The grid of orders on the foreign exchange market
Forex is often used a grid of orders designed to capture market prices. Trading system using this method generally does not pursue the goal of finding the exact points of entry and exit. The goal is to deploy in the market grid of the positions, not even taking into account the behavior of prices. The title of this tool becomes clear that his calling in catching anything.
As the market we are interested in the price, we will hunt on it. This method is very common in the work of beginners, as it requires no special knowledge regarding foreign exchange market, and is based upon a complex mathematical topics. When using this method, rarely turn to the theory of probability.
The principle of constructing the grid on the market can be quite varied, but common elements can be identified:
• First, orders usually line up behind each other at equal distance in points. The position can be directed in one direction and in the opposite direction.
• Second, when price moves in either side constantly open new transaction, and the grid is set further in the direction of the price movement.
• Third, in most case, the bilateral grid is generated, that is, on the chart pending order to buy incrementally, and also on sale with the same distance between adjacent positions.
Grid Forex
In whatever direction go market price, it will still pass through the grid positions, exposed in the direction of its movement. A profitable trade can accumulate to a certain size, but at the same time and close once the price will make another pending order in the trade.
Losing positions in this trade can stay open in hopes of a price reversal. The opening of new orders in the direction of the market can be regarded as a partial compensation of the accumulated losses. Such systems are often combined with hedging strategy.
It turns out that a bilateral netting in Forex like a ready model for immediate locking.
So, a trader can close trades that have profits and at the same time, their lock positions to leave until the market turns. At the turn of the people will capture a profit on order, which have been losses. At this time, on the contrary, profit direction, will now be waiting in the wings to once again start to close with a profit.
Weaknesses of the trading mesh
The speculator is very rarely forced to wait for any signals to open the position. Most often, the trader can set two-way system at any time when he wants to. No matter what direction went the price, it will still start to collect orders design.
Grid in Forex is solely a mathematical model of trade.
Of course, there are weaknesses of such methods. If open would be large amounts of one of the parties, and the price is surely to walk in the opposite direction, even with the profit by of associated trades, drawdown will still grow in the account, like a snowball.
Rare to find an experienced currency speculator who uses such techniques. Yet the mesh is a very dangerous form of trading, which, like averaging, in the event of adverse outcome is set at zero Deposit. Often mesh is used in small cent accounts managed by newcomers to the market. They are satisfied with the lack of need for complex market analysis, and easy to work with this technique.
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| Category: Forex | Added by: (30.10.2017)
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| Views: 287
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