DislikedAnother advantage I see with a reduced SL is the huge improvement in R:R.
Just as an example, on the attached chart is a sample week with a box of 120 pips. With a 30% stop loss, my R:R at TP1 is over 3:1. To equal that RR using a full stop loss, I'd have to hit TP3.
What it means simply is that even if the reduced SL is hit more often, I don't have to be right on my trades as often either.Ignored
Yen Man, that is Cool man.
Exactly my thinking with your excellent example.
People, re-read Yen's post. Absolutley correct. Everyone wants to see the biggest profit. My goal is to minimize my loss, increase my RR and then be happy with the LESS RISK PROFIT. Sorry for the emphasis but that's what this whole thing is about. Make money with minimum risk. I really don't care if people make more money over the short term. I care about RR and making money consistently with AS LITTLE RISK AS POSSIBLE. Remember, this is a HIGH RISK, highly leverage investment.
I remember an old movie, but don't quote me, but I think it was called "Downhill Racer". Not one of your Oscar nominee Movies but there was a line in this movie that was profound that I always remembered. I think a Father or Grandfather was talking to the son (Grandson) about his ambition to be the best downhill skier in the world. The father (Grandfather) said, "no matter how good you are, there will always be someone better!!".
I don't ever take away from the people who want to be the best, but these forums are full of people who do better, create code better, have a system better, trade a system better, than anyone else.
My position in life is real simple. If I can be rich (but not the richest) using a system that gives me a great, consistent return, (with minimal risk), that may well be 25% or more less than the best, I DON'T CARE. I am happy to be rich. I do not have to be the best, the fastest, the sharpest or whatever - rich is fine.
This system with my quick SL plus my re-entry at 25 pips below (above) my SL close where I deem it appropriate is working just fine. Unfortunately I do not have the rules strictly written so they can be programmed. Over the last two weeks I have completely cut back my trading to the minimum entries as the market is weird/confused/erratic/non-directional or whatever you want to call it.
I have made several hundred percent using my modification of Aces system on a Live Dukascopy account where I do not have an EA to trade for me but I can still sleep (sometimes).
If you read all these entries on this forum (and I have read everyone) they all worry about the right entry and then finishing for the week if they are SL out. Everyone feels cheated when they don't do as well as the best poster on the system. Do not compete. Stay with your system. If you see something that looks goods modify your system on your live account only after you have done many many tests on a demo account. Do NOT think you failed because someone else did better. IT DOES NOT MATTER.
Sorry. I love Yes's input an got into the lecture mode. One more thing.
I expect some really serious movement in the next month or two for GBPJPY so be prepared - again IMHO.
Thanks Yen, for your input. Excellent. Love it.
Dave R.