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Forex Correlation Trading EA

The Correlation Trader EA strategy focuses on trading negatively correlated currency pairs GBPUSD and EURGBP. When the correlation between the pairs crosses 0 and becomes negative, the EA will buy GBPUSD and sell EURGBP. It will close both trades for a total profit of $8, as defined in the EA settings, or when the correlation reverses and becomes positive, at which point it will open the opposite positions. By hedging between negatively correlated pairs, the strategy aims to reduce risk and margin requirements while generating consistent profits.

Uploaded by

Pankaj Bhaban
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355 views2 pages

Forex Correlation Trading EA

The Correlation Trader EA strategy focuses on trading negatively correlated currency pairs GBPUSD and EURGBP. When the correlation between the pairs crosses 0 and becomes negative, the EA will buy GBPUSD and sell EURGBP. It will close both trades for a total profit of $8, as defined in the EA settings, or when the correlation reverses and becomes positive, at which point it will open the opposite positions. By hedging between negatively correlated pairs, the strategy aims to reduce risk and margin requirements while generating consistent profits.

Uploaded by

Pankaj Bhaban
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Correlation Trader EA

Strategy details
Lets focus on negatively correlated pairs GBPUSD (1$ / pip) & EURGBP (1.5$
/ pip), now correlation varies from 100% to -100% mostly its -10% to -80%.
Now when correlation crosses 0 and enters negative region EA will Buy
GBPUSD and Sell EURGBP.
Lets assume GBPUSD goes up by 20 pips with correlation of -40% so
EURGBP will go up 8 pips up then profits of both combined trades would be

1X20 = 20$ - 1.5X8=12$ = 8$ profit now EA will close these both trades at
8$ of total profit and exit.

Lets assume both trades profit does not reach 8$ till but market correlation
reverses from negative region towards positive now here EA will open Sell
GBP and Buy EURGBP and name these trades as 2nd for identification purpose
and keep monitoring set of trades when ever any set crosses 8$ profit it will
close that set.
This process keep running and trades here hedging using opposite correlated
pairs is also achieved as well between same pair hedge is also achieve which
helps in reducing margin requirement almost to zero.
This is where it reduces the risk and make good profits.
The total profit of 8$ mentioned in above explanation can be changed in EA
input tab called profitss.
If any queries please contact us pankajbhaban@[Link]

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