Maximizing the winners

So like most I am trying to find an edge. Something that gives me 60%+ accuracy in win:loss ratios but also moves either way a few hundred pips at a time. Mostly!

So in anticipation for finding that, I am now thinking about how to maximise the return when I get it right! I have my stops under control but really want to milk the winners.

Any one got ideas on how to milk good positions to really make a difference.

A few months back I met a guy making $10000+ per month trading a few minutes a day. I was still fairly new and did not want to copy what he did so I did not ask. He did say one thing that I dismissed at the time but now I wish I had asked about. When he gets a 200pip winner he gets at least 2.5x the pips out of it. ie he gets 500pips out of that move. I just thought his position was more than 1 standard lot but now I am thinking he must enter additional positions at various stages of the move, say an additional position every +50p or something.

Any one got any ideas?

Plan the trade, trade the plan.

The trader who makes the most calculations will win the trade before it has even begun.

So, plan each trade to the fullest you can. Take away stuff until there is nothing left to take away.

It's up to you.

what was his winning percentage?

Most systems I see with high winning percentage (+60%) have larger loser to winner ratio.

Most trend following systems have about 40% winning trades.

It's the holy grail having to risk the least and aim for high profit.

At the end of the day, does it make you money over several hundred trades?. If it does, focus on maximizing trade opportunities through compounding (more trades, more markets) rather than individual trade gain. My 2 cents.

Chandalier exit indicator may be of good use for exits.

This is simple, if u are trading a swing, of pips movements more than 100 pips-200pips, just add on retracement, that's all on trendline etc and fibonacci, and then trailing ur positions

For example, If i have a sell 1.3110 EUR/USD, but i am not sure if my position will be right, so i leave it for someday, with a stop lets say 50 pips. So when 1.3110 move down 50 pips to 1.3060, i am more or less comfortable with my position in green, don't cut your winners, only cut ur losers, so probably start trailing stops then, by moving position to Breakeven first. And if the trend looks like a reversal as price cannot returned back to 23.6 level on fibo, witness the breakout point, with selling supports which was 1.3040 then, the sell support area.

The problem is that why are traders adding more and more positions against the counter-trend and when they are wrong in their first trade they can tend to add more losing positions in collapsed/under-water trade, why not add on winners?

So lets say, i have 1.3110, next 1.3040, what i want to do now is to move my stop loss to 1.3050, with gauranteed 60 pips profit, and a sell stop @ 1.3040 moving with 10 pips stop @ 1.3050.

So sometimes u are lucky, in the fundamental/technical change where reversal or swing happens. U hold it longer, the price actually moves down to 1.2950 and freezed on 1.2970 consolidation.

What u may want to do next is to trail ur 1st position to whole number 1.2980 area,

And then 1.3040 position to above 1.3000 psychological level , with 40 pips ++ , this are just recommendation/assumption of riding ur winners.

Next u do the same, sell stop 1.2949 below the support again, So so fortunately, the wanted to do 100% fibo to 1.2880 area.

1.3110 - swing target profit @ 1.2880. get out. don't bother to trail further.
1.3040, trail to 1.2955.

1.2949, profit @ 1.2880.

Leaving 1.3040 last position with 1.2955, + 95 pips ++ etc.

So u can count how much pips u can make. Such techniques are mainly found on daily chart/4hour where its more visible, and positions are taken on good level of swing/ R and S, and then using Fibonacci to understand the current price action's trend, if there is a pull back @ 38.2? 61.8? or a complete retracement to 100.

Just look at the bigger timeframe, imagine each time u plot with a stop of just 50 pips, but target 250pips profit in the end.

So now , trader can still do the same. 1.2880, stop 50 etc, and try to swing back to 1.3125, etc etc. And understanding how to use trailing stop,s breakeven, add on retracement etc etc.

But i am not a swing trader, as my personality doesn't suit this system, so u have to understand ur personality and comfort-ability. I trade on scalping/boxes and breakout, then buy resistance, sell support, which is more intra-day compared to swing, a swing might nailed 200-400pips by the end of one swing, or further breakout, but may not always happen, lets look at AUS/USD for now, its stucked in a consolidation range, so u can't swing on that. Some people are not comfortable, selling lower, or buying higher, they are instilled with buy lo sell hi mentality, which is wrong in Forex, u can only buy lo sell hi in range/s and r. out of s and r, its breakout.

$10,000 is nothing, it have to depend on ur account size, i can scalp the market daily targeting 70-100 pips and still done 350-500pips by each week, so it's really system based.,. If ur account size is 1m, what is $10,000's profit% and risk%? Unless he's so good with leverage system of using just 50pips stop for 200 pips profit, 1:4, then he's really effective and pro, probably using compounding he's more than a millionaire now.

a 2-5% compounding gains a day, can get u really far with just a $5000 account by 1 year. But we talked about consistency.

There are few swing traders here on ff, fx-wolf, vennd etc, u can look at their trade's entry or journal for reference.

You can discover your edge by identifying your patience, personality and psychology management. Understand yourself.

Are you " on the screen " " set and forget " " afford to lose what you can " " Poker trader " etc etc.

Next, don't even bother to do live account, if you want, do 0.01 and a demo of money u want to trade. For example, using 0.01 to train your consistency, and confidence of what the system required, and do the virtual sum u want to trade for example, 1 standard lot on demo, using mirroring trades.

Do the live test instead of back test on chart, know your risk and money management first, then plan your entries and exit points and journal it down, of the success ratio/losing reasons/ratio etc at least for 1-3 months, Before u touch on money u want to make in the market.

Alot of naive people/newbies, jump into the market after searching a system, but failed to understand themselves first, and then failed in their planning of risk and money management. Then they couldn't manage the losses and draw down, eventually they get slaughtered by the market by either margin call/ or becoming an addict trying to chase back their losses, which further multiplied their losses, wasting more money for brokers etc etc. Your system must have a trading plan, a trading plan that u can abide with discipline, as if it's the law. Most trader failed because they can't abide the law sets, not because the system cannot function to achieve more than 50% success ratio and 1:1 or 1:2 rr and etc, to make profit in the market or longevity.

so goodluck.

Why don't you go back and ask him?

A trend = It doesn't look back at previous points, it just move towards a direction.
A range = It check it's side mirrors and decide when to stop and turn.

Personally I felt a range is much easier to trade than a trend, because of it's much predictable turning points, which also result higher probability of winnings.

Just check this thread http://www.forexfactory.com/showthread.php?t=245149

Thanks for all the responses and I dont want to sound unappreciative but I think I may have worded my question wrong.

I am after ideas for getting the most out the winners I successfully pick. Yes I still am yet to find my edge but this thread is not asking for ideas on how I can do this. I have plenty of ideas to do this and am still working through them in a demo account for 14 months so far. Yes I know about leverage and percentage risk and drawdowns and cutting losses and riding wins and trailing stops etc etc. What I dont have in my plan to date is how to maximise the wins.

And no I cant go back to the guy I met otherwise I would have done that by now.

And yes $10000 is not much each month to make but when you consider he did this for a few minutes a day repeatedly, I felt it was something to aspire to. $10000 a month for me is the signal to drop my day job and is my 1st goal in my plan.

1 of the ideas I have and am currently backtesting is adding an additional position at +50p.
To do this I move the stop on the original pos to 0.00 and then add another postion.
Then when the 2nd pos gets to +50p I move original pos stop to +50, 2nd pos to 0.00 and add a 3rd pos.
Then when 3rd pos gets to +50p I move orig stop to +100, 2nd stop to +50, 3rd to 0.00 and add 4th position.
And so on.

The problem I have found with this is that you are always at least 50p risk throughout the entire trade and you are not actually at break even until you have 1st pos stop at +50, 2nd pos stop at 0.00 and 3rd pos opened. And that move would have had to be 100p in your favour.

I've also tried overlapping 100p positions where targets are set to 100p and an additional position to added when at +50p, so there is always at least 2 positions open at a time and when a movement of a couple of hundred pips occurs, you have a couple of positions already closed and locked into your bank.

Any other ideas?

Hi,

One strategy I use (and am still experimenting with) adds a position when — assuming an uptrend — after price closes higher than the previous close, thereby showing that the trend still has strength, it subsequently falls back to a suitable area (support, or is oversold on a lower TF chart). By buying at dips in the uptrend, any losses on the final positions(s) are kept smaller if the position as a whole retraces to its exit criteria; while adding positions increases the overall profit for as long as the trend persists. Vice versa for a downtrend.

You can improve this further by:
1. Trading the longest TFs (I use H4 upward), and
2. Pairing the strongest currencies against the weakest, to improve the probability of obtaining strong, clean trends.

Hope that gives you some ideas to start with. IMO it is the basis of a good trend following strategy.

David

You can't get more pips out of a single trade. I think in your newness you misunderstood.
You can open more positions. But why? You already planned out your trade, why not just go with a higher lot size if you are confident in your plan.

Adding positions to an already positive trade submits you to further spread loss and risk of reversal, turning a positive into a negative. Just move your SL up to new R/S area's. And let it run. To me it's impulsive and impulsive trading gets you in trouble.

If you have a system where your so confident that price will do as you predict, fucking go all in. And I'm sure that's what your idol was doing.
He was so confident that he just threw a ton of lots at it. And when it turned his way he set his stop to breakeven with a trail and forgot about it.

Pips/Return$ is relevant to your account size.
Think about it 100lots @ 10$/pip =1,000 a pip * 10 pips = 10,000usd.
You can get 10 pips in a few minutes.

But what kind of account size do you need for that? lets say US max leverage 50:1 = 2000/lot
So he would have to have an account size of at BARE minimum 200k.

Thats why they say it takes money to make money.

I think you just need to learn when to set your SL to BE, and where to move it at key S/R levels.

Just my opinion mate, I think you just misunderstood him.

Thanks David. I mainly trade the daily charts but I have heard of the close above previous close idea before. I will take another look at it.

Mezzy, you can get more pips. I had a move last month of 378 pips and I made 780 pips out of it by adding positions to the move as it progressed. Also, anyone in my industry would know a plan rarely survives the first contact. Your plan is a plan and it still does not guarantee a good outcome so I believe that if the move is working and your plan is working, why not exploit that as much as you can. Those additional positions become PART OF THE PLAN. Spread is not an issue. I dont care about losing 3 pips if I made another 100 in an additional position. Maybe I did misunderstand him but he is not the only person I have heard making more pips than the actual move.

As I said brother, opening more positions.


~~~ Also, anyone in my industry would know a plan rarely survives the first contact. Your plan is a plan and it still does not guarantee a good outcome...~~~

Also this is not combat, it's trading. Your plan should include an exit in the event of failure. The holy grail is loss management and profit exploitation.

Lets say you and I both go 10 lots on a 100 pip move.
I go 10 at the beginning and manage moving my stops.
You go 1 lot every 10 pips.

Me:10,000
You: 1000, 900, 800, 700, 600, 500, 400, 300, 200, 100 (5500)

Edit:
Your pips: 550
My pips:100
/edit

Who makes more money?

I'm saying it's better to go with your plan, and look for other trades, than to keep adding on. I don't see the point in your method. Just manage your stops proper and you'll be more profitable.

And who loses the most money if the market immediately moves against you and hits SL?
Going all in at the start will lose 10 lots x SL, whereas he who scales in will only lose 1 lot xSL

Gum, exactly!

I would rather have steady growth than hit and miss all the time. Yes you can be confident in your entry but it still does not get you much more than 50% chance at winning. So you need to get in, watch it move in your direction and THEN JUMP ALL OVER IT. Add the additional 9 lots then if you want but not straight up. Each to his own but I see this idea as more along the lines of "loss management and profit exploitation".

One thing I didn't mention, because to me it's obvious. Each component trade must be a valid setup in its own right, otherwise it will (on balance) reduce your bottom line. Some people overlook this, because they look at the overall position as a whole.

Valid point. Although I would probably not be so strict and would be probably enter as long it is not a exit signal maybe.

sorry to say this its unlikely to work out. forex is not moved by 50 pip and keep adding on winners that way. u will experience it when u do live forward runs. price dont move in sequence. price move in level of bounce of higher lo lower high etc price will keep hitting each level of bids and offer until one side gives way for breakout when one side position is trail out. buyer become seller. srller become buyer. under water trades get out at r turn s . s turn r. new limits. tripped on further buy sell stops etc. its individual pair basis and ever chsnfing fundamental. not a 50 pip thing. i already gave u the concept but u fail to see it nor understand it. There's almost no way, to know that ur positions is correct, the only way to to observed the levels of price area that's important for breakout or bounce/trend, for instance after breaking a downtrend pressure,/trendline, if i have a 1.2880 eur/usd long now as proposed in my earlier post, i will move to be now. since it had hit 1.2940 area thus far, next my buy stop is @ 1.2953 area, once 1.2953 is tripped, my first long will trail up to 1.2938. U have to observed price action and level of importance, not add on 50 50 50, grid don't work. Because for example, 1.2953 tripped and move to 1.2972 but stalled there, it can received downward pressure and swing down 100-200 pips from there, so ur swing or adding on winners may not work all the time. it's the experience and technical skills along with rr and mm.

anyway, pips may means nothing. If you can applied a strategy that risk 0.5% for 1 % every round, and have a 50% win rate, its enough. If u can trade 7 pips stop loss for 14 pips win ++ 1:2 or 7 for 21 , 1:3, u can even make 10,000 or grow/compound your winning more faster. Rather than running few hundred pips, why may and may not occur all the time. winner of 200 pips can become loser thereafter, i rem shorters of eur/usd @ 1.2400 area, into 1.200, refused to take profit, next 1.20 move to 1.31, so ur swing may not work all the time, and may end up hedging.

I know what you are saying. I am not stuck on the 50p idea either as I know daily moves can be 150p in the wrong direction before moving back in the right direction.

Thats why I am asking for suggestions.

Using S&R lines and round number lines as zones to watch as you suggest is a good idea.