Averaging down is how I scale into a position.
Once or twice a day, someone is driving the price to a certain level and then ripping their orders from the market and then jumping in on the reversal. That is market mechanics.
Its a personal preference, as I find that a lot of times I am waiting for just that right moment of reversal, and then miss it initially when it happens. Through averaging down, I see it in hindsight, and then am already holding my position, where I would have wanted it to be.
With fifo, this lets me close my 'worse' positions for a profit first, and leaves my best position running (not that it matters, other than psychologically).
Losers average losers is bullshit.
Losers follow other peoples' advice about trading, that's what it should say.
Once or twice a day, someone is driving the price to a certain level and then ripping their orders from the market and then jumping in on the reversal. That is market mechanics.
Its a personal preference, as I find that a lot of times I am waiting for just that right moment of reversal, and then miss it initially when it happens. Through averaging down, I see it in hindsight, and then am already holding my position, where I would have wanted it to be.
With fifo, this lets me close my 'worse' positions for a profit first, and leaves my best position running (not that it matters, other than psychologically).
Losers average losers is bullshit.
Losers follow other peoples' advice about trading, that's what it should say.