DislikedInteresting. Out of curiosity...does this way of trading give decent results? While this method seems very safe in theory...I cant quite comprehend how you take profit on both winning and losing positions. Please explain if you dont mindIgnored
I don't require that I make profits on both the winning and losing trade. It can happen that the loser also becomes a winner as you add to that position, but my main goal is bringing the negative position to BE while claiming the profits from the positive position. If you can do that every time then you've managed to make money on some trades and not lose money on all the others. Not get rich quick, but it's low risk and you're constantly growing your account.
It's basically a hedge but rather than running it long term and keeping some trades open forever you bail yourself out when possible and set it up again. This way you can always have access to the most funds possible.
I wouldn't suggest doing this with more than 1-2% of your account. I was using .5% for a while. I would also strongly suggest only doing this if you're willing to accept small but likely returns over large but high-risk returns. I also find myself using the 1h, 3h, and daily charts for this kind of play more than anything else. But it's a low-risk way to trade when volatility is high and huge swings are possible.