MightyOne wrote:Code: Select all
A lot of the times, with the black TL, instead of drawing it first, I'll wait for something that looks like it breaks a TL and then prepare the chopsticks.
The orange TL are mostly fixed, but if the 2 SMA bumps the first line and then dips back down then I might swing the chopsticks away so that it is no longer touching the line chart.
Notice that we only care about how many lines we usually see; it doesn't matter how many pips it is as the money is based on segments of range.
Let's say that you take the Rat trade at $25/line and you make 2 lines or $50: (10/8)25 you are now trading for around $31.25/line.
You take an entry at the '1' line, pivot BO, and exit at the '3' line for +$62.50: (10/8)31.25 you are now trading for around $39.06
Price enters the chopsticks, you see an over/under, short the '3' line, and exit for 2 lines or $78.12: (10/8)39.06 = $48.82/line
Price retraces into a micro pattern and you think that it will cont. short. You are brave but you are not that brave so you halve your size to
$24.41 to make half lines until there is some sign that price might reverse (result unknown).
Had you stayed at $25/line then you have made 6 lines or $150.
Stacking you made $190.62 or 7.624 lines and even though you are making 'half lines' on the last trade it is still nearly $25/line and if that trade doesn't end in a loss then you will be making over 2 lines of $25 for each line that price passes through: your 20 pip trades become 40 pip wins, your 40 pip wins become 80 pip wins, etc; you need money not pips.
When people tell you that you need to make more pips than you risk it is because they assume that you are trading for pips: some people trade for pips where as other people trade for money.
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Thanks MO!
I surely want to trade for money
Cool that I can do it on bigger charts with the same result.
Learning EIGHTS is all I need, this is for sure.