Grid and Pac Man Programs
Another interesting and less esoteric direction in FOREX automated trading are grid and Pac Man programs.
Between the resurgence of artificial intelligence at one end and the continued frenzy of HF and UHF trading at the other end, a new trading paradigm is emerging. Grid systems trade both sides of a market, scaling in-and-out of a trade as the markets work up-and-down in a band. Thus, a grid always has a hedged position in a pair and can, consequently, make a profit on both sides of it. Pac Man programs take grids to a higher level, predefining a very specific type of market behavior of directional movement and volatility -- and striking only when the markets enter such territory.
When they do, the program executes a hedge order -- both buying and selling similar to a standard grid.
[caption id="attachment_13348" align="aligncenter" width="550"] The Pac Man Paradigm[/caption]