MightyOne wrote:Pjort wrote:
Hello MO and co,,,
If I was thinking about your system in a super simplyfied way... could I say it this way:
I hold a 100 euro LONG position on let say EURJPY at price 1320-
Then price go 40 pip down to 1300 - I reduce my position 20% to 80 euro
Then price go 40 pip down to 1260 - I reduce my position 20% to 64 euro
Then price go 40 pip down to 1220 - I reduce my position 20% to 40 euro
Then price go 40 pip down to 1180 - I reduce my position 20% to 32 euro
Then price go 40 pip down to 1140 - I reduce my position 20% to 26 euro
And so on....
If price then goes my way "the LONG way"... I put on money on the table again!!?
The price go up 40 pip up to 1180 - I expand my position 25 % to 32 euro
The price go up 40 pip up to 1220 - I expand my position 25 % to 40 euro
The price go up 40 pip up to 1260 - I expand my position 25 % to 64 euro
The price go up 40 pip up to 1300 - I expand my position 25 % to 80 euro
Wupti I am back again in business and have the same position as I started uout with, hopefully no loss... (maybee som slippage and spread cost...)
How far from your idear about Lines is this??
I assume that this is on the level of a weekly chart trade?
Let's just say that you were making 100 euro per line (40 pips) so that it looks like this:
100 / 40
I think that there is a night and day difference:
Using a risk-box one has 8 lines of 100 euro and there need not be any reduction in position size:
If you lose 1 line then you have 7 lines of 100 and if you lose another then you have 6 lines of 100.
If you then make 3 lines you can increase your size by (9/6)*100 or 6 lines of 150.
Now you lose 2 lines and decide to focus on preserving space so you bring your lines back up to 6: (4/6)*150 or 6 lines of 100;
had you not lost 2 lines you might have made 2 lines for a total of 8 lines of 150 euro...or 12 lines of 100 which is a $400 profit (12 - .
1 line of 150 euro could be over 80, 40, 20, 10, or 5 pips; I can move seemlessly between pairs and periods:
If you go from 8 lines of 150 to 12 lines then you can reduce your lines to 6 of 300 euro.
If you trade a larger chart then 6 lines is plenty of space and as you bring in more lines you can afford to trade smaller charts where lines are created and destroyed at a faster pace.
After losing 2 lines of 40 pips I could make 2 lines of 10 pips pips: my pip total is -60 but my profit is around break even: that is why I say that we are not "trading for pips".
Thanks for explaining... It is funny I dont it get really - but I feel it is something about staying the trade - like not getting stopped out all the time and being forced to start allover again- and maybee begin to overtrade. Something about being able to keep focus on the bigger picture and being able to catch a larger move...
Have a nice Sunday everyone...