My thoughts here ...
I myself average down my positions, as i am like to have chance to reinvest if price give me the ability to do it.
My trading is far away from scalping the market, so i have the time to follow the guys who move the market. Can i do this in minutes, as the transitions of the big ones changes not that in short and position building for them takes time.
So it depends also on timeframes in use.
Say if i do a "standard" risk from 2% and want to reach a "standard" profit in the end of 4%. You are from the point of going in the position are blocked, on the sideline. You can only accept the following priceaction, eventually reduce initial risk. Thats it. You are all in with the 2% as you will not reinvest because you have the complete position set.
Averaging down on the other hand give you the chance to follow priceaction after the initial position, you can make a second position on a better price.
Say you have three position on the run, by same target, you reach it before the ones who have only one trade in the market. Secure it it with a trailing stop and let it run more.
What if market moves that fast, you have no chance to reinvest? You can move the profit target more far away, you have had no chance to get the complete position set.
How often you are right with the first entry? How often goes price against you, eating the stop and moving after that in direction you forecast earlier? You are out of that if you invest only ones.
I myself average down my positions, as i am like to have chance to reinvest if price give me the ability to do it.
My trading is far away from scalping the market, so i have the time to follow the guys who move the market. Can i do this in minutes, as the transitions of the big ones changes not that in short and position building for them takes time.
So it depends also on timeframes in use.
Say if i do a "standard" risk from 2% and want to reach a "standard" profit in the end of 4%. You are from the point of going in the position are blocked, on the sideline. You can only accept the following priceaction, eventually reduce initial risk. Thats it. You are all in with the 2% as you will not reinvest because you have the complete position set.
Averaging down on the other hand give you the chance to follow priceaction after the initial position, you can make a second position on a better price.
Say you have three position on the run, by same target, you reach it before the ones who have only one trade in the market. Secure it it with a trailing stop and let it run more.
What if market moves that fast, you have no chance to reinvest? You can move the profit target more far away, you have had no chance to get the complete position set.
How often you are right with the first entry? How often goes price against you, eating the stop and moving after that in direction you forecast earlier? You are out of that if you invest only ones.
Perfection is the enemy of good enough!