The Forex grid trading strategy is a technique that seeks to make a profit on the natural movement of the market by positioning buy stop or buy limit orders and sell stop or sell limit orders. This is done on a predefined market distance, with a preset size of take-profit and stop-loss.
It has become quite popular among traders because it’s easy to visualize. However, it is important to know that there’s no guarantee. The great thing about a grid trading system is that it helps you get a return on your investment even in volatile market conditions.
Another great thing about the grid strategy for Forex is that it works in trending markets as well. However, the downside is that the trader always has to keep the available margin in mind – especially, in trending markets.
The good news is you can use ESB to set up an automatic Forex grid trading system that can remove the pain of manually placing trades. The trader just has to write the conditions that the market will go to make a move and the ESB will take care of the rest.
This kind of trading removes the variable of knowing the direction of the price move. However, this also means very complicated money management conditions. Moreover, it increases the margin of error because you will have to manage multiple trades at the same time.
ESB can start grid for buy signals only or just for sell signals. ESB also can start a grid for a buy signal and do its inverse for sell signals and vice versa. This can be set by the “Grid Signal Action Type” parameter.