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Reverse Martingale Strategy Hi Everyone! I learned this strategy recently and it is quite incredible so I thought I'd share it with you and see what you think? As we all know and have heard over and over again, our TPs must always have more pips in them than our SPs. The reverse martingale strategy is used to double our stakes in a particular direction using our profit. This way we can make a huge amount of profit without violating our risk management rules. For instance, let's imagine we identify a bull market and the price has the potential of going up 300 pips. Trade #1: Buy 0.01 Lots of EURUSD @ 1.1200 SP: 1.1150 TP: 1.1300 Risk: 50 pips Potential Profit: 100 pips Trade #2: Buy 0.02 Lots of EURUSD @ 1.1300 SP: 1.1250 TP: 1.1400 Risk: 50 pips Potential Profit: 100 pips Trade #3: Buy 0.04 Lots of EURUSD @ 1.1400 SP: 1.1350 TP: 1.1500 Risk: 50 pips Potential Profit: 100 pips Once the first trade is executed, we make 100 pips profit at 0.01 Lots which will be equal to US$10.00. This is while we only risked 50 pips which would be equal to US$5.00. Now we risk this profit and this time we buy 0.02 Lots again. Once the we reach the second TP, we make US$20.00 and then we risk the US$20.00 and we buy 0.04 Lots this time and we make another US$40.00! Now if the first trade goes wrong, we only lose US$5.00. If the second trade goes wrong, we won't lose anything and if the third trade goes wrong, we will still make US$10.00 BUT if all three trades go as we predicted, then we will make a huge fat profit of US$70.00! |
Can you post a pic to make it more clearer ? |
What would you base your entry and direction on? You cannot have that many consecutive losses when trying to martingale out of a loss. And you require some deep pockets and nerves of steel. |
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How do you figure that losing on the 2nd trade costs nothing? |
1 Attachment(s)
Try out this EA. Entry direction is for you to decide on whatever system you're using. Pyramid EA will handle the consecutive entries and closure based on your settings. Enjoy ! Pyramid_01.ex4 |
I'll simplify what he's doing without the use of any EA. You can place all the orders & go fishing.  1-You get a "buy" signal. 2-Buy .01 with 50 pip trailing SL. 3-Place pending buy-stop to add .01 with a 50 pip trailing SL @ 100 pips higher than 1st entry. 4-Place pending buy-stop to add .02 with a 50 pip trailing SL @ 200 pips higher than 1st entry. 5-TP on all trades is 300 pips from 1st entry. ***The only difference is I used a trailing SL (available in all MT4 platform) so you don't have to monitor the trade. ***There's no reason to have a TP of 100 pips on the first 2 entries if you're going to immediately open a larger position in the same direction. That just costs more in commissions/spreads. Just add to existing position & move SL. |
Hmmm seems like pretty nice |
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Thank you! I'm guessing it doesn't have any criteria for entry? It just enters a position as soon as it's attached to the chart and then starts the pyramiding/snowballing process based on that entry? Am I right? Did you write this yourself? Do you have the source code for it? The difference between Reversal Martingale and Pyramiding is that in Reversal Martingale we double the stakes and risk the profits of the previous trade in the snowballing process whereas in Pyramiding, we don't double the stakes and we add a fixed size to our position in every step. But I can see that in your EA, we can set it up to either increase the Lots or even decrease the Lots or perhaps stick to the same size which is pretty cool. |
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Have you a specific signal in order to go into the trade in buy or sell? |
This strategy has been previously shared by rags2riches before.. |
And about the source code, I'm guessing you don't feel comfortable sharing it? |
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1 Attachment(s)
Pyramid_01.mq4 |
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