Jhx wrote:. . .
I'm too used to simple risk management of % amount per trade; so I don't know how to tackle risk/money management with this yet.
Meaning how to manage risk per trade (or per set of trades maybe?), and how much to add without being reckless, when to close if price moves against if have a large position going on, etc.
Position sizing is 'risk management'.
If you scale into a trade 1 + 1 + 1 + 1 + 1 then the average of your first 5 entries is just 'normal risk';
you are scaling into 5 instead of shorting 5.
Your risk/reward, based on 5 lots, is 20% of the move from each entry. . .
if your progression is 1 + 2 + 3 then your risk is 20% from the first, 40% from the second, 60% from the third;
a 30 pip loss from the third entry is -18 pips, less 60% of the profit from the average of the first and the second.
You should increase when you feel comfortable doing so, aiming for a 40 to 60% stake and buying the rest on a prolonged move.
Swing trading is not day trading, you have to loosen your grip just a little bit.
