DislikedPlain English? That would be boring
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Forgot to say: If we attack and the market is with us we skip to the right (is this spiral in?) and do 8,5,3, to bring our avg price as far away from market as possible.
If we accumulate during a puffy retrace we skip to the left (spiral out?) and do 3,5,8, to bring avg price as close to market as possible.
Regards,
BaifuIgnored
I think there is an old post from leighsww about this.
I have found it, it is not what you wrote about, but similar. See below.
Textor
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leighsww
xoxo Member Since Mar 2007
Posts: 581
Okay, here's the various calculations that show 2 different scout sizes (.5 lot and 1 lot) and rescue troop sizes to obtain an X number of pips from break even. The reaveraged price is after the = sign.
RED = number of rescue troops
Numbers are rounded
If using .5 lot for scout and being 30 pips away ...
.5 @ 158.50 + 1 @ 158.80 = 158.70 (10 pips from break even)
.5 @ 158.50 + 1.5 @ 158.80 = 158.72 (8 pips)
.5 @ 158.50 + 2 @ 158.80 = 158.74 (6 pips)
.5 @ 158.50 + 2.5 @ 158.80 = 158.75 (5 pips)
If using .5 lot for scout and being 50 pips away ...
.5 @ 158.50 + 1 (rescue troop) @ 159.00 = 158.83 (17 pips)
17 pips away from break even is too far, in my opinion, to conduct safe and successful rescues, so I'd prefer to use one of the other below calculations to bring my basis to a more palatable range (either the 10 or 8 pips from break even calculations would be optimum).
.5 @ 158.50 + 1.5 @ 159.00 = 158.88 (12 pips)
.5 @ 158.50 + 2 @ 159.00 = 158.90 (10 pips)
.5 @ 158.50 + 2.5 @ 159.00 = 158.92 (8 pips)
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If using 1 lot for scout and being 30 pips away ...
1 @ 158.50 + 2 @ 158.80 = 158.70 (10 pips)
1 @ 158.50 + 3 @ 158.80 = 158.72 (8 pips)
1 @ 158.50 + 4 @ 158.80 = 158.74 (6 pips)
1 @ 158.50 + 5 @ 158.80 = 158.75 (5 pips)
If using 1 lot for scout and being 50 pips away ...
1 @ 158.50 + 2 @ 159.00 = 158.83 (17 pips)
1 @ 158.50 + 3 @ 159.00 = 158.88 (12 pips)
1 @ 158.50 + 4 @ 159.00 = 158.90 (10 pips)
1 @ 158.50 + 5 @ 159.00 = 158.92 (8 pips)
1 @ 158.50 + 6 @ 159.00 = 158.93 (7 pips)
NOTE: There comes a point of what is called "diminishing returns" so keep that in mind when risking more troops to bring down the basis (ex: don't risk an extra trooper for only a 1 pip gain). If your currency pair makes a certain number of pip pullback moves easily, use the least amount of rescue troops to accomplish your mission (ex: for EUR/JPY, it makes 8 - 10 pip pullbacks easily in a short amount of time, so I would feel confident to use either the 10 or 8 pip range rescue calculations and not have to risk more than those amount of rescue troops).
Now, what if you've already put in a rescue and the market kept moving against you another 30 pips from the reaveraged price ...
1.5 (.5 scout + 1 rescue troop) @ 158.80 + 2 @ 159.10 = 158.97 (13 pips)
1.5 @ 158.80 + 2.5 @ 159.10 = 158.99 (11 pips)
1.5 @ 158.80 + 3 @ 159.10 = 159.00 (10 pips)
1.5 @ 158.80 + 4 @ 159.10 = 159.02 (8 pips)
3 (1 scout + 2 rescue troop) @ 158.80 + 2 @ 159.10 = 158.92 (18 pips)
3 @ 158.80 + 3 @ 159.10 = 158.95 (15 pips)
3 @ 158.80 + 4 @ 159.10 = 158.97 (13 pips)
3 @ 158.80 + 5 @ 159.10 = 158.99 (11 pips)
3 @ 158.80 + 6 @ 159.10 = 159.00 (10 pips)
... this is why you want to make sure that you try to get out your scout on the first rescue attempt if possible. Having to conduct multiple rescues costs a lot of troops!
Okay, I'll be back another time for a sample attack sequence.