When developing expert advisors, there are some things that you need to stay away from so that they will be lucrative in the end. Here are the mistakes and errors that you will need to keep away from in order for the new expert advisors to work properly:
This is sometimes called curve fitting, which is known as the death of system development for expert advisors. However, there are still a lot of programmers who continue to make use of this method and thus, time and again, they continue to fail. With the system of the expert advisors being too optimized, this does not bring benefits for the user. This generally occurs when the programmer has included several indicators and the parameters that he used are too optimized to the specifics he has entered. Thus, the result is that the system will fit in the exact same way it has been optimized for. So, obviously, in the other samples, it will fail miserably.
In-sample data testing
Several programmers, especially the novice ones will actually test the results of their developed expert advisors on the same sample data they have used during the creation of the system. Of course, the system will work on the sample but what about the others? There are different styles out there and in order for the system for expert advisors to work, they should be tested accordingly as well.
One or Limited Pair
Now, another mistake that programmers commit especially for the forex expert advisors is that they develop a system and it only works on a single pair or for a limited number only. Sure, they will perform well on a particular commodity but since there are quite a lot of currency pairs in forex, there is a need to deal with them in case a user or a trader will choose more than one pair. If the expert advisors that you have developed work this way, they shall be deemed useless and unprofitable. Therefore, there is a need to be cautious when dealing with the systems for expert advisors.
Loads of Confirmation Indicators
This can be conducive and that is why a lot of programmers choose to add numerous confirmation indicators into the EA system. However, they do not know that it is hardly ever helpful. Using many indicators will only result to less trading activities. This means that there is a call for higher profit deviation in addition to the long periods of risks and losses. Backtesting a system that accepts only a few trades is difficult to accomplish and the period for doing so will also be lengthy. Instead of confirmation indicators, focus on key indicators so that your system will stay strong and ultimately stick to them.
Relying on Indicators
Manual traders often encounter this problem but this is also true to those who are developing expert advisors. You should know that most of the indicators are a hold up in the transactions of the traders. Even if the indicators work, they can cause delays for the forex trader. If you will rely on these elements, they will eventually limit your developed system for expert advisors with a lesser profitability factor. In their place, you can concentrate more on the variables for the price actions and movements such as Support and Resistance along with the confirming signals that cover price action. This will help you create a better system with lower drawdown.
Expert advisors play a major role in the success of forex traders. Therefore, when you are programming one, you should avoid the mistakes that are stated above so that you can have a best expert advisor for MT4 which will make you a better and more efficient EA system.