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Hedging/averaging trades without prediction

  • #1,501
  • Edited 7:43pm Dec 7, 2022 10:49am | Edited 7:43pm
update as of 11:45 am, EST... EURUSD sell basket BE @ 1.0420

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  • #1,502
  • Edited Dec 8, 2022 4:31am Dec 7, 2022 6:22pm | Edited Dec 8, 2022 4:31am
7:30 pm EST update... not much change from mid-morning..... EURUSD sell basket BE @ 1.0420. Also, for full transparency, I'll start attaching the trade P/L...

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  • #1,503
  • Dec 8, 2022 2:52am Dec 8, 2022 2:52am
what a slow market this morning.....

So far 77 Pips gained but in a DD of 72 Pips...
  • #1,504
  • Dec 8, 2022 5:37am Dec 8, 2022 5:37am
Iam out for today.
Managed to end the session in +

GU kicked me slightly hard... But with plenty of "average"-trades in the rangezone I was able to kill the DD.

Results of the morning:

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Wasn't as easy as it was the days before
  • #1,505
  • Dec 8, 2022 6:43am Dec 8, 2022 6:43am
Quoting Mr.Moe
Iam out for today. Managed to end the session in + GU kicked me slightly hard... But with plenty of "average"-trades in the rangezone I was able to kill the DD. Results of the morning: {image} Wasn't as easy as it was the days before
Yea baby....always have a big bag of patience by your side...
  • #1,506
  • Edited 7:29pm Dec 8, 2022 11:28am | Edited 7:29pm
update as of 12:15pm, EST... looking ugly but it is what it is... 1 GBPUSD buy hit TP for +50 pips. Current $drawdown ~13%. I'm up ~40% since I started 3 weeks ago (see below: starting equity = $222; current balance = $310; current equity: $272.78)
Might as well show all of the data, lol...

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  • #1,507
  • Dec 8, 2022 7:25pm Dec 8, 2022 7:25pm
evening update as of 8:15pm, EST. GBPUSD buy TP hit for +50 pips... current $drawdown ~16%

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  • #1,508
  • Dec 9, 2022 10:06am Dec 9, 2022 10:06am
Hunting down weekly highs and lows with averaging method and scalping trades within and locking profit in the range
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  • #1,509
  • Dec 9, 2022 10:33am Dec 9, 2022 10:33am
this thread, or rather the new way of looking at things, won't let me go. hedging and averaging is work, but there's something constant about it. you won't get rich doing it, but full insurance has its advantages...especially as you get older. and everybody is getting older;-)
trading is like dancing, don't think and just listen to the music!
  • #1,510
  • Dec 9, 2022 7:18pm Dec 9, 2022 7:18pm
Friday evening update as of 4:30pm EST. Several GBPUSD buys hit their TP (+50,+50)...the stronger USD helped alleviate the EURUSD sell basket drawdown...

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  • #1,511
  • Dec 10, 2022 4:55am Dec 10, 2022 4:55am
Hey guys, some really loose rules that are helping me:

 

  1. Start with long and short
  2. Once a TP is hit, look to get back in at a better price to create a “positive gap” (you may wait for just a couple of pips, wait to get back on when the price returns to the original entry or beyond, or even just let other side go to TP and start again - depends on how you feel about the flow of the market)
  3. Often you will fail to create a positive gap as the price will run away. Then you need to decide when to take a “negative gap”. Don’t be too aggressive with this, creating a negative gap is similar to taking a loss. You are here to make a profit and often you just need to be patient and wait out a drawdown. Also, remember you will be averaging the position so you don’t normally have to get all the way back to avoid a loss. But at some point, you want to start hedging the market as it runs away from you. And remember you can still make a good profit through several negative gaps that go to TP so long as most re-entries are at a better price than the last TP.
  4. When price has run 2 - 4 TPs away from the entry then start to average the position with no TP (2 is very aggressive, normally wait for 3 - 4 or even longer if you think longer-term flow is in your favor). Treat the original losing entry and all averages as one position and look to get out at an acceptable price. Continue to hedge in the other direction and keep banking TPs. This way you often won’t even have to get close to the combined BE price (original entry and average trades in the loss direction) to bank an overall profit. If the market is particularly strong however, you will need to take the loss at some point, so money management is crucial here.
  5. Once the position starts getting heavy on the losing side then consider upping the hedging size. A general rule of thumb is once your hedges are under 40% of the losing position then beef them up. Before you go into serious negative then be pretty passive. But if you find yourself hedging a loser at under 40-20% (position size compared to the total losing position), then adjust your position size.

  • #1,512
  • Dec 10, 2022 8:19am Dec 10, 2022 8:19am
Quoting Agro
Hey guys, some really loose rules that are helping me: Start with long and short Once a TP is hit, look to get back in at a better price to create a “positive gap” (you may wait for just a couple of pips, wait to get back on when the price returns to the original entry or beyond, or even just let other side go to TP and start again - depends on how you feel about the flow of the market) Often you will fail to create a positive gap as the price will run away. Then you need to decide when to take a “negative gap”. Don’t be too aggressive with this,...
100% with you. We are on the same page because this knowledge is practical, without doing the work hundreds of times this would not be knowledge.
1.02^200
  • #1,513
  • Dec 10, 2022 8:52am Dec 10, 2022 8:52am
Quoting Agro
Hey guys, some really loose rules that are helping me: Start with long and short Once a TP is hit, look to get back in at a better price to create a “positive gap” (you may wait for just a couple of pips, wait to get back on when the price returns to the original entry or beyond, or even just let other side go to TP and start again - depends on how you feel about the flow of the market) Often you will fail to create a positive gap as the price will run away. Then you need to decide when to take a “negative gap”. Don’t be too aggressive with this,...
Total agree with you. But I want to warn newbees. This is dangerous if you think yuo can avoid losses, you need God management and if yuo average down, bee sure to have enough money in your account.
  • #1,514
  • Dec 10, 2022 9:41am Dec 10, 2022 9:41am
Next week going to be super busy.
Good timing for active traders.
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FUN Week, no rest....from Monday.
I come from the future.
Karen X Mas Bonus 2025 All Time Profit: $15,104
  • #1,515
  • Dec 10, 2022 9:48am Dec 10, 2022 9:48am
Quoting Pat Chiko
Next week going to be super busy. Good timing for active traders.{image} FUN Week, no rest....from Monday.
Would love your analysis on gu next week
  • #1,516
  • Dec 10, 2022 11:32am Dec 10, 2022 11:32am
Quoting Pat Chiko
Next week going to be super busy. Good timing for active traders.{image} FUN Week, no rest....from Monday.
Bro, if uk cpi > consensus, is there any possibility for a BOE 75 bps hike?
More time in the market, does not mean you trade better!
  • #1,517
  • Dec 10, 2022 6:27pm Dec 10, 2022 6:27pm
Quoting Fagin
{quote} Yeah that's a good video. I think most fail at this because they don't know how to roll off, can't be bothered to learn it or are too greedy. Make sure you roll it off! {image}
what these pink color arrows are and what time frame is it? what lot sizes u r taking as in hedge or what size was second sell to close both sells with BE or profit?thanks
  • #1,518
  • Dec 10, 2022 9:12pm Dec 10, 2022 9:12pm
Quoting Fagin
{quote} Yeah that's a good video. I think most fail at this because they don't know how to roll off, can't be bothered to learn it or are too greedy. Make sure you roll it off! {image}
What would you do if price had continued to rise after closing the hedge?
  • #1,519
  • Edited 6:07am Dec 11, 2022 3:13am | Edited 6:07am
agro, you have summarised the process quite well and found the right words. you can only do that if you have experienced it yourself. for a theoretician it is all gibberish and he will not be able to decipher it.

by the way, i have come to the conclusion that i need at least $1000, pound or euro to trade 0.01 microlots and be relaxed. or 100.000 for 1 lot.
that means no leverage for the first positions. starting with $100 and trading 0.01 lots has a lot to do with luck.
trading is like dancing, don't think and just listen to the music!
  • #1,520
  • Dec 11, 2022 3:15am Dec 11, 2022 3:15am
Quoting clemmo17
{quote} What would you do if price had continued to rise after closing the hedge?
I personally would hedge again with a LONG or pending LONG with tight TP so when price does go south chance of pending not being hit, if pending LONG hit and TP hit then repeat process, if pending LONG hit then goes south without hitting TP then wait until SHORT or LONG TP is hit and again repeat process
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