I saw a strategy proposed elsewhere last night that blew my mind. Here it is:
Simultaneously enter both a long and a short position for all possible currency pairs, with a 20 pip stop loss on each trade.
Eventually one will drop below the purchase price by 20 pips, and be stopped out. But the other one will gain instead. If you want, you could pick a take profit -- say another 20 pips (20 pips is easy on the MT4 trading platform modification panel) or more based on experience, and wait for profits. The idea is that to the extent you have time to watch them, don't put any take profit on them, but do so in the event you can't watch them (like sleeping, etc.). The idea is that in the normal course of events, one direction will move more into profit than the stop loss value.
Since each trade takes time to make manually, it is impossible to simultaneously take all positions called for here, but perhaps someone can come up with an EA to do that, although I have never seen one that can do anything like this. Or just limit the pairs to a selected few you can handle.
I think there is lots of room for improvements here. For example, make the take profit higher in the direction of the apparent trend, and make the stop loss lower in the contra trend direction. But some people like to trade contra trend, and might want to do the opposite.
Another possible improvement is to only make one trade for each pair in the direction of the apparent trend (or contra trend for those of you who like to trade that way). What's involved here is the spread loss on each stop loss taken, which perhaps could be avoided.
Of course this is a hedging strategy, but still it is sufficiently different to make it unique in my eperience anyway. I don't know what this would do to margins on minimally funded accounts, but probably not good. I would start this with a demo account, and later move to a live micro account.
I would appreciate all the comments anyone wants to make based on their experience doing something similar. I do think this is something that could be back tested, but would be difficult to do without an EA to do the work.
Charles Wilkes, San Jose, Calif.
Simultaneously enter both a long and a short position for all possible currency pairs, with a 20 pip stop loss on each trade.
Eventually one will drop below the purchase price by 20 pips, and be stopped out. But the other one will gain instead. If you want, you could pick a take profit -- say another 20 pips (20 pips is easy on the MT4 trading platform modification panel) or more based on experience, and wait for profits. The idea is that to the extent you have time to watch them, don't put any take profit on them, but do so in the event you can't watch them (like sleeping, etc.). The idea is that in the normal course of events, one direction will move more into profit than the stop loss value.
Since each trade takes time to make manually, it is impossible to simultaneously take all positions called for here, but perhaps someone can come up with an EA to do that, although I have never seen one that can do anything like this. Or just limit the pairs to a selected few you can handle.
I think there is lots of room for improvements here. For example, make the take profit higher in the direction of the apparent trend, and make the stop loss lower in the contra trend direction. But some people like to trade contra trend, and might want to do the opposite.
Another possible improvement is to only make one trade for each pair in the direction of the apparent trend (or contra trend for those of you who like to trade that way). What's involved here is the spread loss on each stop loss taken, which perhaps could be avoided.
Of course this is a hedging strategy, but still it is sufficiently different to make it unique in my eperience anyway. I don't know what this would do to margins on minimally funded accounts, but probably not good. I would start this with a demo account, and later move to a live micro account.
I would appreciate all the comments anyone wants to make based on their experience doing something similar. I do think this is something that could be back tested, but would be difficult to do without an EA to do the work.
Charles Wilkes, San Jose, Calif.
