Trade Example

Smart Trading Apps: Entry App Example on Dow Jones Index US30

The following is an example on how to use the Entry App with three Profit Taking Limit Stages as used in a sample trade on a FXCM demo account. The Entry Type chosen was "Market Entry", i.e. an immediate entry without an entry price condition.

The Position Management in this App uses a short position (“Sell”) with three profit taking levels of 10, 20, and 30 PIPS. The initial StopLoss distance is 30 PIPS. Thus, Direction is set to “Sell”, NumberOfLimits is set to 3, StopLoss_in_PIPS is set to 30, Limit1_in_PIPS is set to 10, Limit2_in_PIPS is set to 20, and Limit3_in_PIPS is set to 30.

BreakEvenLevel_in_PIPS is zero, i.e. the Break-Even protection takes place reaching the first Limit level of 10 PIPS.

NOTE: If this parameter had been set to e.g. 5, the Break-Even Stop Move would have been executed at a profit level reaching 5 PIPS before reaching the first profit taking limit level of 10 PIPS.

BreakEvenOffset_in_PIPS is zero, which means that the Break-Even protection is set to the exact entry price.

The App will open a position of a size which will lose 1% of the available account equity if the StopLoss of 30 PIPS is hit, since the DynamicRiskManagement is set to “Yes”, RiskMode is set to “Equity”, and Risk_per_trade_in_PERCENT is set to 1.0.

You will see below, that 11 lots were opened in this sample trade for the entire position.

The partial position size percentages are set as follows: Limit1_TradePercentage is set to 50.0, Limit2_TradePercentage is set 30.0, and Limit3_TradePercentage is set to 20.0.

Due to rounding effects, you will notice below that the first partial position size of 50% is set to 6 lots, since you cannot trade 5.5 lots (it has to be an integer value). The second partial position size of 30% is set to 3 lots, which leaves the remaining third partial position size (which represents 20% of the entire position) at 2 lots.

NOTE: Since the dynamic risk management is used, the parameter NumberOfLots is ignored. If DynamicRiskManagement had been set to “No”, the App would have taken the input value of the parameter NumberOfLots (which is set to 10 lots).

 

Position Management of the sample trade:

Upon opening of the short position with 11 lots with an entry price level of 14664, the attached Stop and Limit bracket orders are set as follows:

StopLoss level is 30 PIPS above the entry price as configured, which amounts to 14664 + 30 = 14694.

The first profit taking limit distance is 10 PIPS. The protective Limit order level is at 10 PIPS plus 25 PIPS set as MovingLimitDistance_in_PIPS, which yields 35 PIPS. As this value is already greater than the last profit taking limit distance of 30 PIPS, the protective distance is chosen as the minimum of these two values, which is 30 PIPS. Therefore, the attached Limit order has a price level set to 14664 – 30 = 14636. Remember that this is a protective Limit order. It does not represent the price level to be closed out next!

The trade reaches the first profit taking limit level of 10 PIPS, which is at 14664 – 10 = 14654, where 6 lots are closed out. Additionally, the Stop level is moved to Break-Even price level of 14664. The Limit level will stay at the 14636, since the protective Limit level of the second Limit level and MovingLimitDistance_in_PIPS will be again beyond the last Limit level as already explained for the initial Limit level above.

The trade then reaches the second profit taking limit level of 20 PIPS, which is at 14664 – 20 = 14646, where 3 lots are closed out. Additionally, the Stop level is moved to the first profit taking limit level of 14664 – 10 = 14656, and the Limit level is set to the real third profit taking limit level, since it is the last profit taking limit level of the entire position.

NOTE: In our example, it was already set to this level before, since the profit taking limit levels are close together and in the range of MovingLimitDistance_in_PIPS value.

The trade does not reach the third profit taking limit level of 30 PIPS, but hits the Stop level of 10 PIPS (the first profit taking limit level) instead, which finally closes the position.

The corresponding Email Messaging of the sample short position on US30 instrument with time information:

 

19:12

 

Initialisation of MarketEntry 3 Limit Stages US30 H1 Strategy of US30 Instrument. The Account Equity is 29604.65. The Account Balance is 29604.65.

MarketEntry 3 Limit Stages US30 H1 Strategy of Instrument US30 of H1 time frame: Market Entry Order Triggered for Position: MarketEntry 3 Limit Stages US30 H1_US30_H1_S.

Desired entry price is 14664.00000.

 

Market Entry Order for short position of MarketEntry 3 Limit Stages US30 H1 Strategy of Instrument US30 of H1 time frame successfully processed.

 

Market Entry Order of MarketEntry 3 Limit Stages US30 H1 of instrument US30 of H1 time frame has opened short position of amount 11 being equal to 11 lots of H1 time frame. StopLoss Distance is 30 PIPS. First Limit Distance is 10 PIPS. Slippage is 0.0 PIPS. Account Equity is 29561.76.

 

20:00

MarketEntry 3 Limit Stages US30 H1 Strategy is running.

Ask Price Bar Stream of H1 time frame updating. High Price is 14676.00000, Low Price is 14659.00000, Open Price is 14674.00000, Close Price is 14669.00000.

 

20:31

Triggered Market Exit Order to close out a position or a part thereof.

Short Position of US30 of MarketEntry 3 Limit Stages US30 H1 Strategy of H1 time frame: 1. Limit Price Level reached. Close out 6 lots of the position.

 

Position or part of a position successfully closed. 95575932

 

Short Position of US30 of MarketEntry 3 Limit Stages US30 H1 Strategy of H1 time frame: Triggered modification of Stop Order of open position.

1. Limit Price Level reached. Move StopLoss to Break-Even of 14664.00000 to protect the position.

Triggered modification of Limit Order of open position.

1. Limit Price Level reached. Move Limit to 2. Limit Level of 14644.00000.

 

Stop Order of open position successfully modified.

 

Limit Order of open position successfully modified.

 

20:35

Triggered Market Exit Order to close out a position or a part thereof.

Short Position of US30 of MarketEntry 3 Limit Stages US30 H1 Strategy of H1 time frame: 2. Limit Price Level reached. Close out 3 lots of the position.

 

Position or part of a position successfully closed. 95576118

 

Short Position of US30 of MarketEntry 3 Limit Stages US30 H1 Strategy of H1 time frame: Triggered modification of Stop Order of open position.

2. Limit Price Level reached. Move StopLoss to 1. Limit level of 14654.00000 to protect the position.

Triggered modification of Limit Order of open position.

2. Limit Price Level reached. Move Limit to 3. Limit Level of 14634.00000.

 

Stop Order of open position successfully modified.

 

Limit Order of open position successfully modified.

 

20:37

MarketEntry 3 Limit Stages US30 H1 Strategy Trade Exit of Instrument US30 of short position of H1 time frame entered at Server Time of 02.04.2013 13:12 and Local Time of 02.04.2013 19:12. Entry Price was 14664.00000. Exit Ask price estimated by current Ask price is 14654.00000. Position exit having reached 2 profit levels out of 3 total profit levels. Account Equity is 29713.86.

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