Gold-down EA Forex

Abridged Version

• Dow Theory is a theory developed by Charles Henry Dow
• Gold-down EA is an automated trading system (EA) that uses the uptrend Dow theory, making it suitable for assets that tend to increase in value over time, such as gold or silver

Advantages of this EA

• Profit factor of 1.61 is considered acceptable
• Net profit = 212%
• Max DD = 28.59% (considered good)
• Relative DD = 81.41% (considered high)

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What is Dow Theory?

Dow Theory is a theory developed by Charles Henry Dow over 100 years ago. He published his market trend analysis method in newspapers. Later, people interested in this concept gathered information and formulated it into a theory… The Dow theory has 6 basic principles:

1. The price reflects everything in the market
2. Prices move in trends
3. Price trends are divided into 3 phases: accumulation, price surge, and distribution
4. Market averages must correlate
5. Volume must confirm the trend
6. Trends continue until there’s a clear reversal signal, which we use in writing the EA for uptrends

 

How Gold-down EA works

The Gold-down EA system uses one of Dow’s principles that trends continue until a clear reversal point. The developers have chosen the uptrend

 

Conditions for entering a Buy Order

1. Choose the desired time frame (tf), recommending larger than 1 hour to prevent false signals
2. Count back 10 candles and determine the lowest and highest points in those 10 candles
3. Start entering orders when the price breaks through the highest point of all 10 candles. Users can set their own stop loss and take profit

 

 

Features

• Lot setting
• TP and SL setting
• Zig zag (set the number of candles to count back)
• Martingale lot size

 

Requirements

• Currency = XAU/USD (recommended)
• Time Frame = H4
• Capital = Minimum $1000 or 10,000 USC (recommended)
• Broker = Eightcap, Aetos, Forex4you, Land-FX
• Unlimited Account

 

Gold-down EA settings

• SL = 500
• TP = 1000

 

Backtest results

• Used 99.9% Tick data, tested over 4 years [Variable spread 1-25; Leverage 1:500; Optimize Slippage; Market delay 30-40ms; Pending delay 30-40ms]
• Profit factor of 1.61 is considered acceptable
• Net profit = 212%
• Max DD = 28.59% (considered good)
• Relative DD = 81.41% (considered high)

 

 

Conclusion

Gold-down EA is a trading system that uses a simple trading method but requires time to monitor the screen. Therefore, turning this system into an EA makes this trading method easier and more efficient. However, investors should study its operation thoroughly to manage their own risks

 

Team eaforexcenter.com