BreakingMagnum(MT5)

Product Overview

Thank you for visiting BreakingMagnum.

*This is the MT5 version.

BreakingMagnum is a daily high/low breakout EA.

Place stop orders at the daily high and low and extend profits with a trailing stop when the profit is more than the specified pips.

Three currency pairs are supported: USDJPY, EURUSD, and GBPUSD.

BreakingMagnum is characterized by the fact that it is "an EA developed by the author based on his experience of operating breakout EAs for more than a year.

After actually operating the breakout EA, I have noticed that

Breakout EAs perform much worse than backtests when run in real accounts."

This was the case.

To avoid misunderstanding, it is not "not winning" but "failing to make the grade".

Therefore, we developed this EA with the theme of "how can we reduce the decline in performance" rather than "stop breakout.

In the following sections, I will explain the issues I have discovered in breakout EA operations and how to counter them with BreakingMagnum.

Challenges and Countermeasures

Breakout EAs have a large drop in performance when operated in a real account.

We believe there are three main reasons for this.

1. make a slip of the tongue
2. Spreads widen
3. The trail is a dud and the gain is missed.

1. order slips

Near the highs and lows where the breakout EA sets stop-losses, price movements will be severe.

As a result, execution often slips below the intended value.

(Usually it's about 1 or 2 points, but if it's bad, it slips more than 1 pips...)

This results in a profit that is several points smaller than in the back test.

<Measures

Due to the nature of logic, some slippage is inevitable.

By increasing the expected gain, the profit remains even if it slips.

2. spread widens

Breakouts often occur when price movements are severe.

When prices move rapidly, the spread widens, which in turn cuts into profits.

Unintended losses may also occur due to spread widening in the early morning hours.

<Measures

When price fluctuations are strong, it is a good time to make money, so it is inevitable that the widening of the spread will reduce profits somewhat.

Two features have been implemented to avoid losses due to early morning spread widening.

• Stop Order Delete Function Delete stop orders at the specified time
• Forced Position Closing Function Forced closing of positions at a specified time

In ver3, when the spread widens beyond the specified spread, the

Added the ability to delete all stop-losses.

3. the trail is unsuccessful and the gain is missed.

I used to look at the chart and cheer "Go for it!" whenever a breakout entered the market.

So I looked closely and found that there were several times when I lost at the place where I should have been able to escape at the closing price after the trail was triggered.

When we took a backtest, we found that there were several losses that were not present in the backtest, and that caused the performance to drop significantly.

(The impact of one more loss is tremendous in a system with a large loss and a small gain.)

We consider the following two factors to be responsible for the failure of the trail.

• Trailing order was submitted but did not go through. Did the price change cause the order to fail?
• Trailing orders could not be submitted. The number of ticks became so large that the EA could not submit a trail order because it could not keep up with the processing of the EA?

<Measures

By making the design as simple as possible and increasing the processing speed of the EA, the speed of order placement was increased.

back-testing

After a lengthy discussion, here are the results of the back test.

*Because QuantAnalyzer is not available in MT5, this is a back test using the MT4 version of the same logic.

Conditions: 0.1 lot fixed, TDS variable spread (no slippage)

　　　The portfolio is based on three currency pairs, USDJPY, EURUSD, and GBPUSD.

Long-term backtests since 2003 show a steady increase and no negative year-to-year changes.

Although the results will be lower than this in actual operations, we have included the backtest results with real ticks downloaded from OANDA in MT5 for your reference.

Back testing on MT5

The backtest results on MT5 (OANDA) are as follows

We have been winning with OANDA's real ticks without any problems.

(It has a staggering profit factor of 3.14 or something like that...)

caution

Operating Environment

BreakingMagnum is an EA with large performance differences depending on the operating environment.

Your results will vary depending on your brokerage, VPS, and VPS resources.

Spread Expansion

Spread widening during indexes has become worse since the summer of 2022.

Some brokerage firms are experiencing spread widening and slippage in excess of 100 pips.

The following imageshows the BreakingMagnum profit and loss formy real account.

Although the performance has been generally stable and steadily increasing, we suffered significant losses in August and September due to widening spreads caused by indicators(August's losses were almost fully compensated).

In response to this deteriorating trading environment, BreakingMagnum has introduced a risk avoidance feature.

If the spread widens beyond the specified

• Remove stop-losses and restrain entry
• Force close a position if you had one (you can also choose "don't")

function.

With this feature, I am no longer caught in spread widening due to indicators, sudden news, or early morning spread widening.

The default is to trigger at 5 pips, but please change this to match your brokerage.

Conclusion

How was it?

I have started off by undermining breakout EAs out of the blue, but I myself believe that breakout EAs are strong.

It is very difficult to handle compared to anomaly EAs, etc., so I would not recommend it to beginners.

However, I think the fun of EA is to think about how to win.

If anyone is interested, please operate it.