How To Forex trade with sucess - Caliber FX Pro - System Manual

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How To Forex trade with sucess - Caliber FX Pro - System Manual

  1. 1. Caliber Fx Pro EA Portfolio Trading System USDJPY – EURUSD - GBPUSD
  2. 2. Table of Contents Caliber FX Pro – Portfolio Robots ................................................................................. 4 Caliber FX Pro Trading System Indicators .................................................................... 4 ZigZag Indicator ............................................................................................................. 5 Long Entry Overview ..................................................................................................... 7 Short Entry Overview .................................................................................................... 7 Final Exit ......................................................................................................................... 7 INPUTS ........................................................................................................................... 8 Portfolio Robot DEFAULTS ....................................................................................... 8 Money Management ..................................................................................................... 9 Risk % ...................................................................................................................... 9 Lots ................................................................................................................................ 11 Hidden Stops ................................................................................................................. 11 Stop Loss ....................................................................................................................... 11 Profit Target ..................................................................................................................12 Use Trailing Stop and Trailing Stop .............................................................................13 Break Even Trigger .......................................................................................................13 ECN Brokers ..................................................................................................................13 5 Digit Brokers...............................................................................................................13 Optimization Course Defaults ..................................................................................... 14 Forex Market Overview .............................................................................................. 18 FX Caliber Support Team ............................................................................................. 22
  3. 3. DISCLAIMER U.S. Government Required Disclaimer - Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risks. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to Buy/Sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results. CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR- OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. In fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. Hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk in actual trading. All information on this website or any e-book purchased from this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold Caliber FX Pro and any authorized distributors of this information harmless in any and all ways. The use of this system constitutes acceptance of our user agreement.
  4. 4. Caliber FX Pro – Portfolio Robots Diversification in is one of the keys to successful trading, whether that be via manual or robot trading. Diversification means you are ‘not putting your eggs in the one basket’ and are taking positions simultaneously in other markets offsetting potential risk. The Caliber FX Pro was designed and optimally performs on the USDJPY currency pair, but has also been optimized to also trade on the GBPUSD and EURUSD pair. Caliber FX Pro Trading System Indicators • MT4 (custom) ZigZag Indicator • MT4 (custom) OsMA Indicator Predominately the Caliber Robot follows a Trading System that is based upon two MetaTrader 4 custom indicators called the ZigZag Indicator and the OsMA Indicator.
  5. 5. ZigZag Indicator The Zigzag Indicator (red zigzag line) is a good visual indicator of the main overall trend movement of the price movement of a market via identifying peaks and troughs, but isn’t the best type of indicator to determine an entry into the market. Therefore we have introduced the OsMA indicator for pin pointing the entries and exits. The MT4 OsMA is used as over bought and oversold indicator.
  6. 6. So two very nice and simple indicators have been added to the chart. Both of these indicators can be found within MT4 – Insert/Indicators/Custom... Now the combination of the Entries, Exits, Take Profit with Risk and Money Management...
  7. 7. Caliber FX Pro Trading System Long Entry Overview Essentially the robot is looking for the simultaneous event of both the ZigZag indictor must be pointing upward whilst there is ‘x’ number of UP OsMA bars (this number of bars varies depending on the different currency pair defaults). Short Entry Overview Just the opposite of the long entry, here the robot is looking for the simultaneous event of both the ZigZag indictor must be pointing downward whilst there is ‘x’ number of DOWN OsMA bars (this number of bars varies depending on the different currency pairs). Final Exit The robot will make the final exit when there is ‘X’ input number of OsMA bars into the opposite direction of the trade. Eg; A long trade would mean the trade would exit when there are ‘X’ number of down OsMA bars.
  8. 8. INPUTS Portfolio Robot DEFAULTS
  9. 9. Money Management This setting must be on TRUE to work, otherwise the LOT setting will dominate. Risk management is the most important component to trading. It is always best to work on the basis of a “worst case scenario” and this is managed through your ‘position sizing’. In the FX Caliber there are two settings which can be used to determine the POSITION SIZING that the robot will take on each new trade. 1. RISK % 2. or standard LOTS Risk % The RISK – the FX Caliber default is set on 2%. This means that the robot will automatically calculate the appropriate number of Lots it enters into for every new trade according to the newest account balance after the last trade.
  10. 10. For example, If your starting balance is $5,000 and your risk is set at 2% this means for each trade you do not want to risk more than $100 on each trade. If the Stop Loss was set to 100 pips from the entry, and if your Accounts pip value is 10cents per pip movement, then your risk is $10 per every 1 lot (100x 10ct). Then the robot calculates; $100 divided by $10 = 10 Lots it can enter into. If your trade is profitable and you make a $200 profit – on the next trade the robot automatically makes the same calculation but on the new $5,200 balance. This is the better setting as you know exactly how much of your account you are risking on each trade and when successful the new position size is compounded and should you have a run of losses the robot reduces the position sizing so that you keep within balance. Turn the default figure down if 2% is too much. To use the Risk % you need the MONEY MANAGEMENT to be set to TRUE to work – otherwise the Lot setting will dominate.
  11. 11. Lots The Standard LOTS gives you the ability to override the RISK % setting – make sure you set the MONEY MANAGEMENT to False for this to become active. This means your EA will continuously purchase the same number of lots that you have requested for each trade until instructed otherwise. Hidden Stops This setting is for traders should they wish to hide their stop losses from Brokers. Stop Loss As soon as the Caliber Robot takes a new trade it will immediately place a Stop Loss to the order at ‘X’ pips from the entry price (X = the default setting each particular EA currency pair). This means should the market go against you at some point and reach that distance the trade will automatically be closed out.
  12. 12. Profit Target The Caliber Robot will also Take Profit and capture half of the positions profits by closing out half (50%) of your Lots when it reaches the ‘X’ pip Profit Target. This is great in fast moving markets that may suddenly reverse. So for the USDJPY Caliber if you took 2 Lots for a trade and the value per pip was $1. That means your total risk on the trade is $200 (100 pip SL x $1 x 2). Once the market reaches the 200 pip Profit Target (should the Break Even tool not be used...see next page), the Caliber Robot automatically closes out 1 Lot (50%) and that means you now have $200 in the bank. The remaining risk is now left at the 1 remaining lot with the Stop Loss still 100 pips from the entry price ($100). So your $200 profit covers the $100 remaining risk plus puts $100 profit into your pocket should the initial Stop Loss be hit.
  13. 13. Use Trailing Stop and Trailing Stop Although the default settings do not require the trailing stop loss for peak performance, this function is there for traders who would like to use a trailing stop loss for peace of mind and lock in profits earlier. Just remember that at times a trailing stop loss can hinder good trades by being too close to the market price action. Break Even Trigger The Caliber Robot also has further built in optional profit protection and risk minimisation tools, this one comes in the form of moving the Stop Loss to break even (entry price) when a certain level of profit has been reached. The USDJPY Caliber has been programmed with a 40 pip profit breakeven point. So once the market has moved 40 pips into profit the Stop Loss is immediately brought up to the entry price protecting the position should the market suddenly reverse. ECN Brokers If your broker is an ECN broker ensure this is set to TRUE 5 Digit Brokers If your broker displays prices with 5 digits (# of digits after decimal point for all pairs except USDJPY) ensure this is set to TRUE.
  14. 14. Optimization Course Defaults As mentioned, the performance results for the Caliber are for the 12 month period of 2009, (all input settings are noted further below for 2009). We also include the 2010 settings below too. For any traders who have purchased the Optimization Course these are the default settings for each pair so you now have the ability to optimize the entire robot. Most of the advanced EA input settings are ‘hidden’ but an ‘unlocked’ version of the Caliber EA comes with the EA Optimization Course which teaches you how to continually optimize the EA to best performance over changing market conditions and even tune to any currency pair. OPTIMIZATION COURSE and EA - Follow this link USDJPY – DEFAULTS - 2010 • OsMA Min=17 • OsMAMinEXIT=20 • OsMAFast =16 • OSMASlow=34 • OsMASignal=2 • ZZDepth=22 • ZZDeviation=16 • ZZBackstep=6 • ZZExit=True • UseMM=True • Risk=2% • Hidden Stop=False • SL=50 • TP=80 • Use Trail=False • Trail=30 • BETrigg=40 • BEBuffer=10
  15. 15. GBPUSD – DEFAULTS – 2010 (no change) • OsMA Min=10 • OsMAMinEXIT=14 • OsMAFast =20 • OSMASlow=15 • OsMASignal=14 • ZZDepth=16 • ZZDeviation=16 • ZZBackstep=6 • ZZExit=True • UseMM=True • Risk=2% • Hidden Stop=False • SL=50 • TP=190 • Use Trail=False • Trail=30 • BETrigg=40 • BEBuffer=10 EURUSD – DEFAULTS - 2010 • OsMA Min=7 • OsMAMinEXIT=9 • OsMAFast =8 • OSMASlow=14 • OsMASignal=12 • ZZDepth=14 • ZZDeviation=20 • ZZBackstep=4 • ZZExit=True • UseMM=True • Risk=2% • Hidden Stop=False • SL=20 • TP=250 • Use Trail=False • Trail=30 • BETrigg=40 • BEBuffer=10
  16. 16. USDJPY – DEFAULTS - 2009 • OsMA Min=12 • OsMAMinEXIT=20 • OsMAFast =14 • OSMASlow=40 • OsMASignal=14 • ZZDepth=16 • ZZDeviation=16 • ZZBackstep=6 • ZZExit=True • UseMM=True • Risk=2% • Hidden Stop=False • SL=100 • TP=200 • Use Trail=False • Trail=30 • BETrigg=40 • BEBuffer=10
  17. 17. GBPUSD – DEFAULTS - 2009 • OsMA Min=10 • OsMAMinEXIT=14 • OsMAFast =20 • OSMASlow=15 • OsMASignal=14 • ZZDepth=16 • ZZDeviation=16 • ZZBackstep=6 • ZZExit=True • UseMM=True • Risk=2% • Hidden Stop=False • SL=50 • TP=190 • Use Trail=False • Trail=30 • BETrigg=40 • BEBuffer=10 EURUSD – DEFAULTS - 2009 • OsMA Min=20 • OsMAMinEXIT=16 • OsMAFast =16 • OSMASlow=10 • OsMASignal=14 • ZZDepth=10 • ZZDeviation=2 • ZZBackstep=6 • ZZExit=True • UseMM=True • Risk=2% • Hidden Stop=False • SL=30 • TP=180 • Use Trail=False • Trail=30 • BETrigg=40 • BEBuffer=10
  18. 18. Forex Market Overview • Currencies values are forever fluctuating, their value is measured up to another currency; the two currencies together are referred to as a “pair”. • There are two groups of “pairs” – the Majors and the Crosses. These two names distinguish the difference between the more popular (the Majors) and the less traded (the Crosses). • Pairs are abbreviated, for example the Euro Dollar against the US Dollar is displayed as EUR/USD. The first currency, eg the EUR, is the “base” currency and the second currency, the USD, is the “counter” currency. • The Majors are; EUR/USD, AUD/USD, GBP/USD, USD/JPY, NZD/USD, USD/CAD, USD/CHF. • The quotation of the price in Forex is either in 4 decimals or 5 decimals. So quite different to the usual 2 decimals we are used to in normal everyday money exchange. Normally if something was priced at $1.50 and increased in price by 1 cent the new price would be $1.51. But in currencies this 1 cent increase is actually a massive move in forex trading and is actually quoted as 100 “pips”. • Price movement is quoted in PIPs, which is short for ‘Price in Points’ and are only a fraction of a cent (1 hundredth of a cent), so are quite tiny and the very reason for the requirement of such large leverage in Forex trading to make the profits on these small price movements worthy.
  19. 19. • Prices are displayed with 4 digits like this; 1.5000. Some Brokers quote in 5 digits for more accuracy in price quotation; 1.50000. The PIP is read as the last digit on the right, so if the market increased by 4 pips the price would now be quoted as; 1. 5004 If the market increased by 100 pips the markets new price would be displayed instead as; 1.5100 The only differently quoted currency is the Japanese Yen which looks like this: 104.50 • The Leverage is a great attraction of forex – this means you put down a small deposit to trade larger sums of borrowed currency – so this opens this investment vehicle up to smaller investors. But remember, be smart with your leveraging, do not go beyond your knowledge! • Another exciting feature is that the potential risk in forex trading is ‘limited’. This means at the very maximum you can only lose the balance of your trading account. I know that still may sound significant, especially if you had quite a few thousand dollars in there – but my point is, other instruments like Futures and Derivatives can run the account into the red, a
  20. 20. negative balance. (A stop loss is a safety mechanism where your trade is automatically liquidated should the market go against you and reach predetermined exit level). • As a trader, it is your responsibility to ensure that your positions are monitored. Should they get close to your Brokers margin policy minimum then you need to either put more capital into your account, or increase your leverage (which decreases your margin).Some brokers will close out all your positions regardless if they are a losing trade or in profit – so be mindful of this and check out your brokers margin policy carefully, otherwise you would be very disappointed to be closed out of a good trade, one that could have made up for the losses of the bad ones that brought you into the losing situation in the first place. Your trading platform may have an alert system that makes you aware your account is getting low, however when the markets are moving fast there may not be enough time for you to make any adjustments. • Currencies are traded by ‘Lots’ and these determine the value of the pip movement. The size of each lot depends on what type of trading account you have opened; a Standard account or a Mini account or a Micro Account or a Learner Account. The difference between them is the minimum lot sizes available to trade. Standard Account minimum is 100,000 currency units (1 lot), value per pip movement = $10. Mini Account minimum is 10,000 currency units (1 lot), value per pip movement = $1. Micro Account minimum is 1,000 currency units (1 lot) , value per pip movement = 10 cents.
  21. 21. Learner Account minimum is 100 currency units (1 lot) , value per pip movement = 1 cent. • No Commissions or Brokerage! Well the brokers actually make their money through the “spread” is how the brokers make their money. When trading stocks both a spread and brokerage are charged to the trader. But the main cost to a currency trader is the spread. Spreads are generally not fixed so can widen during times when news is released and there is high market activity, so is not a defined amount. Some Forex brokers do charge a flat brokerage rate so the charge is a little more transparent. The dealing spread is the price difference between the Bid and the Ask. The BID is the price that the Trader SELLS to the Broker and which the broker BUYS from the Trader for. The ASK is the price that the Trader BUYS from the Broker and which the broker SELLS to the Trader for.
  22. 22. FX Caliber Support Team support@caliberfxpro.com

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