In this article I will teach you how to perfect your Expert Advisor(forex robot), by enhancing the quality of your signals and entries.

Entries are undoubtly the most important aspect of any Expert Advisor. A matter of a few pips can be the difference between losing or winning. I will now describe the popular ways of increasing the probability of entries, and their advantages and disadvantages.

Confirming with Many Indicators
While the idea of cross-confirming with many indicators seems attractive to novices in the field of Expert Advisors programming, it usually leads to a flawed system which rarely works. The reason behind it, is the following: The more indicators you add, the less trades you are going to have, therefore, you can’t really estimate the profitability of your system. Furthermore, the use of many indicators often encourages beginners to over-optimization of their robot, which is the ultimate kiss of death to any EA.

Using a Long-Term Moving Average
This technique is also a popular one, used to filter trades. The user adds a long term Moving Average (usually of 100-200 periods) and requires all trades to be in the direction of that MA. Unfortunately, as profitable as this technique sounds, confirming your trades with an 200-MA often disables the systems edge, by removing any chance of catching market bottoms and tops – where the big trends lay. The EA could only catch small trends, which are often corrections rather than actual trends. Using this technique can cause your profit factor to decrease significantly.

Using Price-Action to Confirm
This procedure is one that I am fond of. Using price action to confirm, or even signal the trade is a more advanced technique, rarely used by novice programmers. It requires solid knowledge in Technical Analysis and Chartism, beyond regular indicator knowledge. However, this technique can empower your trades signifantly. By requiring that price advances 10 pips in your direction prior your actual entry, you can filter many losing trades. It is also an effective technique of filtering range phases from your trend-following system. This technique is also used in the Bunny Girl system, and can be the reason for its success. This strategy can be extra-useful when combined with quick BreakEven stop lockage technique. For ex.: Moving to BreakEven+1 pip profit after 10 pips of profit is acheived. This can lead to a very good minimization of losses and drawdown.

I have given you important tips, but knowledge isn’t enough – you have to practise and experiment with the techniques and implement in your expert advisors.

Michael Wells is the lead programmer in FXCode Inc. He has been programming Expert Advisors and Custom Indicators for Meta Trader for 3 years. Visit FXCode to automate your trading system!

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