Boom And Crash EA Review – An In-Depth Look at This Forex Trading Robot
The foreign exchange (forex) market can be a lucrative yet challenging arena for traders. With so many automated trading systems available, it can be difficult to know which one to choose. One system that has been gaining popularity recently is the Boom And Crash EA. In this comprehensive review, we will take an in-depth look at this trading robot to see if it lives up to the hype.
Overview of the Boom And Crash EA
The Boom And Crash EA is an expert advisor (EA) designed specifically for trading the volatile boom and crash synthetic indices offered by brokers like Deriv. It is an automated trading system that aims to help traders profit from the extreme price spikes seen in these indices.
Some key features of the Boom And Crash EA include:
- Fully automated trading: The system opens, manages, and closes trades automatically according to its programmed logic. Traders don’t need to manually intervene.
- Works on multiple indices: Can trade boom and crash indices like Boom 500, Boom 1000, Crash 500, and Crash 1000.
- Customizable trading settings: Users can tweak settings like lot size, stop loss, take profit, and more to suit their preferences.
- Martingale money management: Trades with an increasing lot size after losses to recoup equity.
- No grid trading or averaging down: Avoids risky overtrading by not adding to losing positions.
The EA runs on the popular MetaTrader 5 platform and is available for purchase on sites like the MQL marketplace. There is also a free demo version for testing. Next, let’s look at how the Boom And Crash EA works.
How the Boom And Crash EA Works
The core strategy of the Boom And Crash EA revolves around identifying trend direction and trading pullbacks within the trend. Here are the key aspects of its trading approach:
- Determines trend using moving averages – The EA uses a set of moving averages to gauge whether price is in an uptrend or downtrend. The trend bias is up when the fast MA is above the slow MA and down when the fast MA is below the slow MA.
- Enters trades at reversal points – Using indicators like RSI and stochastic, the EA identifies potential reversal points within the trend. For an uptrend, it looks to buy dips. For a downtrend, it looks to sell rallies.
- Sets stop loss and take profit – Each trade has a stop loss and take profit level defined right from the outset. The stop loss aims to limit losses if the trade moves against the position. The take profit locks in gains when the profit target is reached.
- Uses martingale for recovery – After a stop loss is hit, the EA re-enters the trade with an increased lot size. This helps it recover prior losses as long as the trend direction doesn’t reverse.
- Closes trades at day end – All open trades are closed out automatically at the end of each trading day. The next day, new trades are entered based on updated market conditions.
By trading in the direction of the trend and using martingale to recoup losses, the EA aims to systematically turn an overall profit over time. Next, let’s discuss some of the pros and cons.
Pros of the Boom And Crash EA
Automated trading: The EA handles trade entries, exits, risk management, and everything in between automatically. You simply let it run.
Customizable settings: Users can tweak settings like lot sizes and stop loss to match their account size and risk tolerance.
Martingale can recover losses: The martingale approach helps the EA recover from losing trades by increasing lot size on subsequent trades.
Good backtest results: Many users have reported good backtesting results that show consistent profits over long periods.
Cons of the Boom And Crash EA
Martingale can be risky: While martingale helps recover losses, it also risks much bigger losses if the market trend strongly reverses.
Over-optimization risks: The EA may be over-optimized to historical boom and crash data, which could affect real trading performance.
No guarantee of profits: As with any EA, there is no guarantee that live trading results will match backtest results. Losses can still occur.
Needs monitoring: The EA shouldn’t be left to run unchecked. Drawdowns need to be monitored in case the martingale gets too aggressive.
Only works for boom and crash: The EA is specialized for trading the synthetic boom and crash indices rather than regular forex pairs.
So in summary, the martingale-based recovery system and automated trading capabilities are major pros of this EA. However, the risky nature of martingale and potential for over-optimization raises some concerns. Proper usage and monitoring is vital.
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Using the Boom And Crash EA
If you decide to use the Boom And Crash EA, here are some tips to use it effectively:
- Start with a demo account – Thoroughly backtest the EA and optimize settings using historical data before going live. Paper trading can identify potential flaws.
- Use tight stop loss – Keep stop loss tight, around 10-20 pips, to prevent martingale from accumulating big losses. Move to breakeven once position is in profit.
- Trade multiple indices – Trading Boom 1000, Crash 500, and other indices improves diversification and reduces risk compared to trading just one index.
- Monitor drawdown – Watch drawdown levels closely. If 10-20% drawdown is reached, stop trading and re-evaluate settings.
- Trade small lots – Trade micro lots (0.01 or 0.02) initially to avoid margin calls. Only increase lot size gradually as equity grows.
- Avoid overtrading – Stick to trading the boom/crash indices rather than other forex pairs the EA isn’t optimized for.
Using prudent position sizing, monitoring drawdowns, and managing risk are crucial to success with this EA. Next, let’s discuss some sample results.
Backtest and Live Results
Extensive backtesting can give insights into the kind of results to expect from the Boom And Crash EA. Here are some sample backtest results from the developer and users:
Developer backtest on Boom 1000
- Period: 2015-2022
- Gain: +531%
- Drawdown: -18.2%
User backtest on Crash 500
- Period: 2020-2021
- Gain: +1173%
- Drawdown: -44.1%
Live results posted on FXBlue
- Period: Sept 2021 – Present
- Gain: +372%
- Drawdown: -22.5%
These results showcase the potential gains this EA can produce on both the boom and crash indices. The deep drawdowns also highlight the inherent risks associated with martingale trading. Individual user results may vary depending on settings, money management, and market conditions.
Some users have complained about the EA not performing as profitably in live trading as the backtests. This is common with many EAs. The key is to start small, use tight stops, and tweak settings conservatively.
Verdict: Is the Boom And Crash EA Worth It?
In general, the Boom And Crash EA seems to have merit based on backtest results and feedback from some users. However, like most martingale EAs it carries higher risk. Here are some final pros and cons:
- Profitable backtest results
- Good for trading boom/crash volatility
- Automated trading system
- Customizable settings
- Martingale carries risks
- Potential over-optimization
- Live results may vary
- Needs close monitoring
For traders comfortable with the risks, the Boom And Crash EA for MT5 can be a worthwhile tool to potentially profit from the boom and crash markets. As always, proper money management, risk control, and responsible usage is key.
The best option is to initially test it thoroughly in demo mode. If it performs well and suits your trading style, only then consider using it on a live account with small position sizes. Don’t rely on it fully to replace manual trading. Use it as one tool as part of a broader trading approach.
The Boom And Crash EA is an intriguing automated trading system designed to trade the volatile boom and crash indices in a profitable way. It has garnered a lot of attention from the forex trading community.
This detailed review has covered how it works, key features, pros and cons, usage tips, and sample results. In the hands of a knowledgeable trader with robust risk management protocols, the Boom And Crash EA may be a valuable addition to a well-rounded trading strategy. However, like any EA it has weaknesses as well.
As always, discretion is advised when using any automated trading system. Thoroughly backtest and demo trade the EA first before even considering going live. Take proper precautions to minimize risk on your account.
With its solid track record so far, the Boom And Crash EA may be worth exploring for traders interested in trading boom and crash indices. Just ensure you go into it with full knowledge, open eyes, and proper risk management.