Summary of "Learn How the Grid Trading System makes 300% on actual charts!"

Summary of "Learn How the Grid Trading System makes 300% on actual charts!"

This video, presented by Alexo from Expert Forex, provides an in-depth explanation and live demonstration of the Grid Trading System, focusing on its application to the EUR/GBP currency pair over a one-year period. The Grid Trading System is presented not as a traditional trading method but as a long-term investment approach that leverages market volatility without requiring directional predictions.

Main Financial Strategies and Concepts:

  1. Grid Trading System Basics:
    • Simultaneously placing buy and sell orders at defined price intervals (grid levels).
    • The system profits regardless of market direction because it captures gains as prices oscillate.
    • Trades are closed profitably when price reaches the next grid level; losing trades remain open to be offset later.
    • No stop losses are used; risk is managed through the system's structure and later pruning.
  2. Grid Multiplier Concept:
    • The repetitive nature of market waves allows the same trade to be repeated profitably multiple times.
    • Each grid level provides an opportunity for a positive trade, making the system directionless.
  3. "Carpet" of Open Trades:
    • The "carpet" refers to the collection of open buy and sell trades across grid levels.
    • Initially, the carpet is funded by the trader's account but ideally becomes self-financing through profits.
    • The carpet grows over time, increasing potential profits as the price moves within it.
  4. Phases of Grid Trading as Investment:
    • Phase 1: Choose currency pair (preferably low volatility, non-trending like EUR/GBP), grid size, and lot sizing.
    • Phase 2: Build the Carpet of Open Trades, allowing it to be financed by generated income.
    • Phase 3: Prune the carpet by closing some trades to reduce exposure and risk, especially when the carpet becomes too large or unbalanced.
    • Phase 4: Print consistent profits once the carpet is established and funded by income.
  5. Currency Selection and Risk Management:
    • Use currencies with low volatility and limited trending behavior to avoid large directional moves (e.g., EUR/GBP).
    • Gap size between grid levels is based on historical price range (e.g., 8 pips).
    • Lot sizing depends on account size and risk tolerance.
    • Protective settings like maximum difference between buys and sells can trigger hedging or trade direction reversal.
  6. Profit and Risk Dynamics:
    • The system can generate substantial returns (300% over one year in the example).
    • Equity and account balance grow steadily as trades are cashed in.
    • The carpet size and equity balance fluctuate; managing these is key to long-term success.
    • Pruning trades is necessary to avoid overexposure and reduce risk but was not applied in the example.
    • The system relies on patience and a long-term perspective, as initial phases may show negative equity.
  7. Operational Details:
    • Trades automatically open buy and sell positions at each grid level.
    • Cashing in happens when price moves to the next grid level, locking in profits.
    • The system does not use technical indicators or time frames; it is rule-based and automated.
    • Brokers may not charge overnight fees if buy and sell positions offset each other.

Step-by-Step Methodology for Grid Trading System:

Market Analysis and Business Trends:

The Grid Trading System is effective in markets with sideways or oscillating price action rather than strong trending markets. The EUR/GBP pair was selected based on a standard deviation channel analysis showing a yearly range of

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Business and Finance

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