Density Scalper is a very interesting scalping strategy Expert Advisor developed for the MetaTrader 4 platform and published on the MQL5 website. The scalping is defined by the Mean Reversion strategy, meaning the trades are made on the assumption the price of an asset is high or low enough for a reversal to happen. Therefore this is a reversal scalper EA that avoids “unnatural” market events during the day and relies on the simple laws of demand and supply to find the most accurate signals. The developer is Roman Lengert from Germany who initially published the EA on 10th October 2019 on the MQL5 market.
The latest version is 2.4 updated recently, on the 10th of March 2020 during the latest COVID-19 world market event. The base code and idea of this EA are not new from the author, the previous product called NY Close Scalper is using the same principles except Density Scalper is optimized for better slippage management. Therefore the release date does not mean the EA does not have enough forward testing done.
In the Overview page of Density Scalper, there are a few disclaimers first. Aside from the general, that the past and backtesting performance does not guarantee future performance, there is a note stating any flash movements may ruin the strategy implemented and therefore the EA works only during the calm market environment and used the Stop Loss level. The execution of the Stop Loss may be delayed depending on the broker during the flash crash or other major events.
Every position made by this EA has the Stop Loss set. Mertinglage, Grid, or other unsustainable methods are not used. Density Scalper works on the M5 timeframe on the following assets: EUR/USD, GBP/USD, EUR/CHF, USD/CHF, USD/CAD, EUR/CAD, and EUR/AUD. Other experimental currency pairs are AUD/USD, AUD/NZD, AUD/CAD, EUR/NZD, CHF/JPY, GBP/CAD, GBP/AUD. Interestingly, the author showcases the maximal drawdown in $ value per lot or $35-50 per 0.01 lots for 16 years. In percentage terms, we have noticed 3.8% up to 4.97% in a different condition and a bit shorter-term (since 2009). Still, this Drawdown level is very attractive considering very good performance.
Quant Analyzer is used to showcase the performance. Some notable backtesting facts are 84.02% winning rate, 3.8% maximal drawdown using fixed lot allocation (0.1), $4.9 average trade value, 146.85% average yearly gain (portfolio on multiple pairs tested from 2003 using $5 commission and 150ms execution delay). Backtesting from 2011 till the end of 2019 shows a 4.98% drawdown on complete portfolio trading, 78.5% winning rate, 58.37% average yearly gain, and 9864 trades for this time.
Roman Lengert puts some effort to leave a rounded up quality supports and leaves a link for users to have good settings and have live monitoring charts. The links are provided on how to set up all of his EAs too in a separate blog post. The content is very organized and of high quality, leaving the impression of a dedicated developer that also has great knowledge about trading. Since the EA is a scalper on the M5 timeframe, it is imperative to have a good broker with low spreads and slippage and fast executions. A VPS is also needed for constant running as the EA collects historical data for trading. In the event of market disruptors such as elections, BREXIT, etc, the EA should be off. Note that the EA is using the Breaking News Filter in the results, to filter news impact on the market. The link is provided and recommended to use in conjunction.
As for the settings, there are just a few related to Money Management and certain trading conditions. Lot type can be set to “fixed” or “increasing”, while the maximum spread tolerance can also be set to avoid trading in times of high dynamic spreads. There are also other uninteresting settings related to server time and so on.
The price of Density Scalper EA is extreme, $2000 to buy having 5 activations, $125 to rent for 1 month, $300 for two, $500 for 6, and $900 for 1 year. To some, the price is well worth the trouble. The developer is very supportive and posted that for users that rented the EA lately causing disappointing results, he will discount the price for future rents. The demo is available so you could test this EA. According to the quality work and dedication, the price may be worth it if you have good results.
The final rating of all Roman Lengert’s work is above 4 and for the Density Scalper, a perfect 5 star based on 8 user reviews on MQL5. This sample may not enough get a complete picture of user satisfaction although there is a good probability this EA is a great addition to the trading community. Some of the user praises are:
“I have never seen a better EA, Roman is a very good Developer and his support is great. Five Stars!!”
Or the latest one from March 2020 describes the service very well in detail:
“Best Scalper and developer out there on MT4. Roman is brilliant in providing full transparency on all his EA’s, backed up with live results across multiple brokers. I have been running it now for 6 months and all my results across all his EA’s mirrors his signals perfectly, unlike other scalping programs out there at the moment. Roman has taken care of building in loads of safety checks and balances on slippage and account protection in case of a market crash. He is also very active in its on-going development and always responds very quickly to any questions. 10/10.”
On the MQL5 analysis page using the AxiTrade live account, Density Scalper shows ongoing trading since the 23rd of March 2019, a total of 211 trading days. The average holding time is 49 minutes meaning the EA is not the classic scalper. The chart shows a growth of 40.9% for this time, 37.39% for 2019, and 2.55% for the part of 2020. The developer stopped trading since the COVID-19 volatility spike on the forex market. The reason lies in the EA’s unsuitability to run in this environment as there is no calm nighttime. In March, Density Scalper suffered a loss of 1.43% with a spike in Drawdown like in the crisis 2008/09.
This Forex service can be found at the following web address: https://www.mql5.com/en/market/product/40941