I like this type of trading and have studied this and "grid" trading much in the past. My theory is the same: very difficult to "predict" markets, so you should trade in a "reactionary" approach.
Have you looked at averaging down before actually placing a reverse trade? I am very interested in averaging down because this too takes advantage of the volatility. It also has the advantage of keeping the original trade open and having that trade work for you without starting over on the spread.
Its just a thought and I may be out in left field, but what about averaging down a few trades before actually placing the reverse trade? Especially if your original trade is with a heavily trending market.
If you look at the EUR the last 6 years, the heavy traders were all buying on dips and making a lot of money doing it. Not a lot of brain surgery. The key of course is trading small to outlast runs against you.
Just some thoughts, but I like this style of trading.
Have you looked at averaging down before actually placing a reverse trade? I am very interested in averaging down because this too takes advantage of the volatility. It also has the advantage of keeping the original trade open and having that trade work for you without starting over on the spread.
Its just a thought and I may be out in left field, but what about averaging down a few trades before actually placing the reverse trade? Especially if your original trade is with a heavily trending market.
If you look at the EUR the last 6 years, the heavy traders were all buying on dips and making a lot of money doing it. Not a lot of brain surgery. The key of course is trading small to outlast runs against you.
Just some thoughts, but I like this style of trading.
"Its not where your at, but where your coming from"