Woow this thread grew up so much in just a day!
I made some stats on EUR/USD. From Jan 1st 2011, 10 millions first ticks. For each and every tick I checked whether a short and a long would have been a winner or a loser. From these 20 millions trades I could get some meaningful statistics for a pure random entry.
Buying at the ask and selling at the bid, TP=5 pips, SL=100 pips. Net of spread. You either make 5 or lose 100. The TP is slighly higher than DNA's. But this doubles the R:R from 1/40 to 1/20.
The minimum required probability to breakeven is 95.24%. The results are much lower. In average a random entry has a win rate of only 92.5%! During the 5 first months of 2011, an up-trend, the long positions had a win rate of only 93.59% (91.8% for the shorts). So without some edge this strategy doesn't work long term. But by just adding a slight edge, it is certainly possible to have a positive expectancy. So YES the system is important.
I made some stats on EUR/USD. From Jan 1st 2011, 10 millions first ticks. For each and every tick I checked whether a short and a long would have been a winner or a loser. From these 20 millions trades I could get some meaningful statistics for a pure random entry.
Buying at the ask and selling at the bid, TP=5 pips, SL=100 pips. Net of spread. You either make 5 or lose 100. The TP is slighly higher than DNA's. But this doubles the R:R from 1/40 to 1/20.
The minimum required probability to breakeven is 95.24%. The results are much lower. In average a random entry has a win rate of only 92.5%! During the 5 first months of 2011, an up-trend, the long positions had a win rate of only 93.59% (91.8% for the shorts). So without some edge this strategy doesn't work long term. But by just adding a slight edge, it is certainly possible to have a positive expectancy. So YES the system is important.
No greed. No fear. Just maths.