Pair Trading Indicator: i K Pair-TR
Info
The Pair Trading Indicator: i K Pair-TR is a Indicator for MetaTrader 4 that author: ikatskoindicator features:- correlation coefficient: the correlation coefficient between two currency pairs must be greater than 0. 75 in absolute value.
Usage
This tool is typically used for enhancing chart analysis and decision making.
Platform
This Indicator works exclusively on MetaTrader 4 (both build 600+ and newer versions).
Setup
Place the downloaded file in MQL4/Indicators folder via File ? Open Data Folder in MetaTrader 4.
How to Install and Use Pair Trading Indicator: i K Pair-TR
1. Installation: Place your file in the MQL/Indicators folder via "Open Data Folder" and restart your terminal.
2. Loading: Find the indicator in the Navigator, drag it onto your chart, and configure the input parameters in the popup window.
3. Customization: Press Ctrl+I to open the indicator list, select your tool, and click "Properties" to change colors, levels, or visual styles.
4. Updating: Replace the old file in the Indicators folder with the new version and restart the platform to apply changes.
Frequently Asked Questions
Q: Why is my indicator not showing? A: Verify the file is in the MQL/Indicators folder, or try right-clicking the "Indicators" tree in the Navigator and clicking "Refresh."
Q: Do custom indicators slow down the platform? A: Too many complex indicators can impact performance; remove unused ones via the "Indicator List" (Ctrl+I).
Q: Can I use MT4 indicators on MT5? A: No, MQL4 and MQL5 are distinct languages; ensure the indicator is compiled specifically for your platform version.
What this tool does
Author: ikatskoIndicator Features:- Correlation Coefficient: The correlation coefficient between two currency pairs must be greater than 0.
Typical Use Case
This Indicator excels in automated trading and technical analysis on MetaTrader 4.
Compatible Platform & Setup
This Indicator works on MetaTrader 4. Place the file in the MQL4/Indicators folder and restart the terminal.
Description & Settings
Related: Bars Alligator Trading Advisor - another powerful indicator for MetaTrader 4 traders.
Author: ikatskoIndicator Features:
- Correlation Coefficient: The correlation coefficient between two currency pairs must be greater than 0.75 in absolute value.
Also recommended: Spread Indicator for Pair Trading - similar indicator with strong performance on MetaTrader 4.
- Fair Price Ratio: Assumes the price ratio of selected currency pairs remains constant over a period. If the ratio deviates, it is expected to revert to the fair value.Trading Algorithm Simulation:
The interpreter simulates trading on historical data using the following algorithm:
- Entry: Enter the market after the first extreme deviation of the price ratio from the fair value (e.g., above the fair level). Entry/exit points are marked by vertical lines.
- Exit: Exit the market after the first extreme deviation of the price ratio from the fair value (e.g., below the fair level) if there is a profit on open positions. The logic is reversed if the deviation is below the fair level.
- Order Placement: Upon market entry, two orders are opened on the selected currency pairs, depending on the correlation coefficient's sign. For example, with positive correlation and a price ratio deviation above the fair value, place a SELL on the primary pair and a BUY on the secondary pair.
- Profit Tracking: Monitor the total points of both orders. Exit the market when conditions are met.
- Profit Calculation: Total profit is summed over the selected history and annualized to a daily profit.
Rationale:
This interpreter was developed because the MQ4 Strategy Tester does not support optimizing trades on two currency pairs simultaneously.
Input Parameters:
bas_SYMB: Primary currency pair (default: EURUSD).
sec_SYMB: Secondary currency pair (default: USDCHF).
History: Lookback period in bars for analysis (default: 288).
Precision: Tolerance for determining the fair price. For example, if the price stays within a certain corridor in 50% or more of cases on the history, this parameter defines that tolerance. The corridor is marked by two horizontal lines (default: 50).
MA_Period: Smoothing period for the deviation curve from the fair price (default: 1).
Indicator Visualization:
- Green curve: Deviation of the price ratio from the fair value.
- Vertical lines: Market entry/exit points.
- Horizontal lines: Fair price tolerance, dependent on Precision.
- Red histogram: Current profit in points.
- Information line: Displays the two currency pairs, daily profit in points (pt), and correlation coefficient (cor).
Timeframe: The indicator operates on the timeframe of the chart window it is attached to.
Trade wisely and prosper!
You may also like: The Little Whore Trading Strategy - excellent alternative for indicator users on MetaTrader 4.
⚠ Limitations & Risk Warning
- This tool is provided for educational and testing purposes only.
- Past performance does not guarantee future results.
- Trading involves substantial risk of loss. Use on a demo account first.
- Results may vary depending on market conditions, broker, and settings.
- We recommend thorough backtesting and forward testing before using with real funds.