I made my own system from scratch. It does not tell you when to buy and sell and there are no signals. Instead of being predictive (such as head and shoulders, neural nets, etc.) it capitalizes on a particular pattern in the chart. When the chart appears and you are in, you make $.
The way it works is you are always in the market with $1000 leveraged 400:1. I prefer the NZD/JPY pair because margin is only 1.67 per minicontract.
What you do is go long with 83 contracts. Margin call with 83 contracts is -100 (-109 w/ spread). After you gained 100 pips (91 w/ spread) you go long an additional 68 contracts.
What is nice is that you can buy more contracts with the profit from the first trade, and not close it. The first "leg" stays open to continue profiting.
The effect of buying more contracts puts your margin call at -109 again, and at the most you can sustain a 199 pip swing because you will buy more contracts at +91. That is to say, after buying 68 contracts, the price can rise 90 pips and then fall 180 pips and your trade will still be alive.
If you can compound repeatedly (as in Q1 NZD/JPY) you can turn $1,000 into $1,000,000 on a single trade. It takes about 1100 pips to do this with no more than 200 pip reversal at any time.
The down side is that you will lose $800 on a margin call in the first leg. After 4 legs, the margin holding the position is greater than $1000 so a margin call is a profitable trade. Max Risk: $800.
Tom
PS) I like the potential of this idea but there needs to be better risk management. All ideas are welcome.
The way it works is you are always in the market with $1000 leveraged 400:1. I prefer the NZD/JPY pair because margin is only 1.67 per minicontract.
What you do is go long with 83 contracts. Margin call with 83 contracts is -100 (-109 w/ spread). After you gained 100 pips (91 w/ spread) you go long an additional 68 contracts.
What is nice is that you can buy more contracts with the profit from the first trade, and not close it. The first "leg" stays open to continue profiting.
The effect of buying more contracts puts your margin call at -109 again, and at the most you can sustain a 199 pip swing because you will buy more contracts at +91. That is to say, after buying 68 contracts, the price can rise 90 pips and then fall 180 pips and your trade will still be alive.
If you can compound repeatedly (as in Q1 NZD/JPY) you can turn $1,000 into $1,000,000 on a single trade. It takes about 1100 pips to do this with no more than 200 pip reversal at any time.
The down side is that you will lose $800 on a margin call in the first leg. After 4 legs, the margin holding the position is greater than $1000 so a margin call is a profitable trade. Max Risk: $800.
Tom
PS) I like the potential of this idea but there needs to be better risk management. All ideas are welcome.
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