Loki Trading System Review: An In-Depth Analysis

The Loki Trading System is an advanced automated trading system designed specifically for the MetaTrader 4 (MT4) platform. Developed by an experienced team of traders and programmers, Loki aims to help traders profit in the forex market through algorithmic trading.

Loki Trading System

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In this comprehensive review, we will analyze the key features of Loki, evaluate its strengths and weaknesses, and determine if it is a worthwhile investment for forex traders.

Overview of the Loki Trading System

Loki is marketed as a fully automated expert advisor (EA) that can trade multiple currency pairs across various timeframes. It uses a combination of technical indicators, price action analysis, and machine learning to scan the markets for high-probability trading opportunities.

Once installed on the MT4 platform, Loki will automatically execute, manage, and close trades based on its complex algorithms and logic. A key highlight is the system’s use of rigorous walk-forward optimization, having been tested and refined over 5 years of historical data.

Loki Trading System Main Features

Some of the notable features of the Loki Trading System include:

  • Walk-forward optimization – Optimized over a 5 year in-sample period to adapt better to changing market dynamics
  • Multiple timeframe analysis – Scans timeframes from M1 to Daily to identify trading opportunities
  • Trend and volume analysis – Uses proprietary indicators to gauge trend strength and momentum
  • In-built risk management – Implements stop losses, take profits, and position sizing rules to control risk
  • Stealth mode trading – Trades are visible only to the user to prevent trade copying

Overall, Loki aims to offer a comprehensive automated trading solution through ongoing development and rigorous optimization. Next, we analyze its performance and test results.

Performance Results & Backtesting Analysis

Extensive backtesting and optimization is vital for evaluating any automated trading system.

According to the vendor, Loki has been optimized using a walk-forward analysis methodology on over 5 years of historical price data across multiple currency pairs. The published backtest results indicate the system was able to generate:

  • Total net profit of $230,000
  • Max drawdown of 18%
  • Profit factor of 1.7
  • Over 70% winning trades

These metrics point to a robust and profitable trading system. A 18% max drawdown shows effective risk management, while a profit factor above 1.5 is considered excellent.

However, past performance does not guarantee future results. It’s essential to use the Loki EA in demo mode extensively before risking capital. Traders should backtest the system using their broker’s data for at least 3 months while tweaking the inputs.

Real Account Trading Performance

In addition to backtests, real account trading results indicate Loki has shown steady growth over a 8 month period:

  • 193% growth over 8 months
  • Max drawdown of 12%
  • Over 65% winning trades

The lower drawdown and consistent growth confirms the system’s potential for live trading. However, a sample period of 8 months is quite short – most proven EAs show reliable performance over at least a 2 to 3 year timeframe.

Using the Loki Trading System

If you decide to purchase Loki after analyzing its backtest statistics, using the system correctly is key to long term profitability. Here are some tips:

Installation and Configuration

Loki offers simple installation through dragging and dropping the EA file onto a chart. The system can then be configured by loading the recommended preset files or manually inputting parameters.

Some key settings that can be customized include:

  • Timeframes – Optimal timeframes to run system
  • Currency pairs – Assets to trade
  • Position sizing – Lot sizes for different capital sizes
  • Risk management – Stop loss, take profit, trailing stop

Spending time to properly configure Loki based on your account size and risk tolerance is essential. Never use default settings without testing.

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The vendor recommends using ECN/STP brokers with fast execution and low spreads for optimal performance. Some recommended regulated brokers include:

Avoid brokers that use trade manipulation, requotes, or high spreads as this can negatively impact results.

Risk Management

Rigorous risk management is key to long term profitability in forex trading. When using Loki, be sure to follow these guidelines:

  • Start with small position sizes and low risk
  • Use moderate leverage according to account size
  • Implement stop losses on every trade
  • Monitor all trades; avoid over-optimizing

Losses are part of trading – effective risk controls will allow you to survive drawdowns.

Strengths of the Loki Trading System

Based on multiple customer reviews and performance metrics, Loki clearly has some competitive advantages:

Innovative Trading Logic

Loki combines trend strength analysis across multiple timeframes with tick volume analysis. This innovative fusion aims to detect high probability trading opportunities early. The algorithms are continuously improved through machine learning.

Walk Forward Optimization

The rigorous walk-forward optimization of over 5 years of historical data instills confidence in Loki’s ability to adapt to changing market conditions. Ongoing improvements also indicate developer commitment.

Reasonable Pricing

Unlike many EAs priced in the thousands, Loki is affordably priced at $97. This can benefit new traders looking for an introductory automated trading solution.

Positive Reviews

Multiple traders have reported steady account growth and reliable performance after extensive demo and live trading. Reviews indicate Loki is easy to install, configure, and monitor through a transparent dashboard.

Shortcomings of Loki Trading System

However, Loki also exhibits some weaknesses that must be considered before purchasing:

Still Relatively New

While results are positive so far, Loki has only been live traded for around 8 months. Most proven automated systems show consistent performance over a much longer timeframe of 2-3 years.

Overoptimization Risks

While walk-forward testing improves reliability, overoptimization on past data remains a risk. This could lead to curve-fitted parameters that fail in live trading. Extensive demo testing is mandatory before using Loki.

Potential Conflict of Interest

The Loki developer also owns a brokerage, which indicates a potential conflict of interest. There are risks the system could be optimized solely for that broker’s trading environment.

As with any EA, traders should be wary of promises that seem too good to be true. There are no shortcuts to profitable algorithmic trading.

Loki Trading System Conclusion & Final Recommendations

Loki Trading System shows promising potential as an automated trading solution for MT4 based on its features and performance metrics. For its affordable price, Loki seems to offer robust trading logic and effective risk management.

However, as with any expert advisor, extensive independent testing across different market conditions is mandatory before considering it for live trading. No EA can guarantee profitability despite the most advanced algorithms. By managing risk properly, testing thoroughly, and having realistic expectations, Loki can be a useful addition for skilled traders.

Overall, budding traders interested in exploring algorithmic systems can give the Loki Trading System a try. The two week free trial should provide sufficient time to gauge its reliability. However, traders should not treat Loki as a “set and forget” passive income solution without dedicating regular time to monitor its operation and performance.

Author: Dominic Walsh

I am a highly regarded trader, author & coach with over 16 years of experience trading financial markets. Today I am recognized by many as a forex strategy developer. After starting blogging in 2014, I became one of the world's most widely followed forex trading coaches, with a monthly readership of more than 40,000 traders! Make sure to follow me on social media: Instagram | Facebook | Linkedin | Youtube| Twitter | Pinterest | Medium | Quora | Reddit | Telegram Channel

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