Extended Martingale | Page 3 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Martingale, Anti-martingale, and Compounding 40 replies

Martingale, Reverse Martingale, Modified Martingale, Maths 1 reply

Martingale Calculation EA (also reverse martingale) 3 replies

How to change this Martingale to Reverse Martingale ? 3 replies

Martingale vs. Non Martingale (Simplified RoR vs Profit) 1 reply

Attachments: Extended Martingale
Exit Attachments

Extended Martingale

  • #41
  • Edited 4:42am Aug 23, 2011 2:42am | Edited 4:42am
Has anyone tried Average up. I know its nothing to do with the martingale approach. but it works very well in stocks, and looks very good in FX 2. It has been introduced by the famous jesse livermoore and now is practised by william o'neil in stock trading.

first entry = 50% of the intended lotsize
second entry = 30 % of the intended lot size (after 2.5% increase in stocks)
last entry = 20 % of teh intended lot size (after 5% increase in the stock)

all depending on what TF and pair, its an approach i like because if u are wrong on first entry then u only loose half. if price goes up 20-50 pips then second entry is triggered etc. etc.
Has anyone experience with this approach???

Lehmann
  • #42
  • Aug 23, 2011 3:34am Aug 23, 2011 3:34am
Any chance you could show me a visual of what your intending?

Ive read your description but it isnt quite clear to me yet.

I have some ideas that may or may not help but i need to see if its worthwhile for your concept first...

Pip
  • #43
  • Edited 8:59am Aug 23, 2011 4:07am | Edited 8:59am
Averaging Up

I have made an example:
If i intend to go long EU with total 1.0 lot and i have my first entry at 1.4400, i will buy 50% of 1 lot at that level. my stop is at 1.4360 all the time. If my plan doesnt work out then im stopped out but only loose half of my intended lot size.
If price keeps going up, my second entry will be at 1.4425 with 0,3 lot
last entry will be at 1.4450 with 0,2 lot (total 1.0 lot) and an average price of 1.4417.
If my last entry is hit i can always move my stop to either BE or at first entry, but thats another approach....
Attached Image (click to enlarge)
Click to Enlarge Name: eurusd.jpg Size: 123 KB
  • #44
  • Aug 23, 2011 9:14am Aug 23, 2011 9:14am
Quoting Pipalicious
Any chance you could show me a visual of what your intending?

Ive read your description but it isnt quite clear to me yet.

I have some ideas that may or may not help but i need to see if its worthwhile for your concept first...

Pip
Great Pip lover,

This is a visual. I tried to indicate essential reference points. Hope its clear.

King.
Attached Image (click to enlarge)
Click to Enlarge Name: 5.gif Size: 23 KB
  • #45
  • Aug 23, 2011 9:34am Aug 23, 2011 9:34am
Quoting lehmann
Has anyone tried Average up. I know its nothing to do with the martingale approach. but it works very well in stocks, and looks very good in FX 2. It has been introduced by the famous jesse livermoore and now is practised by william o'neil in stock trading.

first entry = 50% of the intended lotsize
second entry = 30 % of the intended lot size (after 2.5% increase in stocks)
last entry = 20 % of teh intended lot size (after 5% increase in the stock)

all depending on what TF and pair, its an approach i like because if u are wrong on first entry...
Scaling out the way you described is actually a less aggresive form of pyramiding because you are adding more lots to an original entry as the trend progresses( read nears an end).

An alternative (The real scaling out) is to reduce exposure as you progress. In your example Your first enter with 5 lots then take some profit while keeping only 3 Lots to continue because now the trend is supposedly weaker. Towards the end (If you knew, suspect or whatever form of indication you use,) you now leave only 2 lots exposure and finally close out. If the trend reversed along the way you have less to worry about.

The problem here is you start out with a big exposure. Trend following strategies typically have numerous losses while waiting for that one big runner. Starting out with big lot size will then be detrimental to your interest.

Hope I make sense.

King.
  • #46
  • Aug 23, 2011 2:56pm Aug 23, 2011 2:56pm
Quoting lehmann
Has anyone tried Average up. I know its nothing to do with the martingale approach. but it works very well in stocks, and looks very good in FX 2. It has been introduced by the famous jesse livermoore and now is practised by william o'neil in stock trading.

first entry = 50% of the intended lotsize
second entry = 30 % of the intended lot size (after 2.5% increase in stocks)
last entry = 20 % of teh intended lot size (after 5% increase in the stock)

all depending on what TF and pair, its an approach i like because if u are wrong on first entry...

Livermore definitely knew how to "swing a big line", and how to test the waters first.

Scaling in has alot of different angles too, such as adjusting your stop as you scale in, so if the trend has a massive correction, you don't get wiped out.

Kingusurfer, have you thought about using a "breaker" type approach for martingale? For instance, if you had 5K to start with, divide that into five 1k lots and apply martingale to your 1k lot, instead of the whole 5k.

So if you do blow up, you simply move to the next 1k lot and repeat. And everytime you double your 1k lot, you simply reduce risk by splitting it into two 1k lots.

This would assumingly keep the outlier/black swan events from destroying all of your capital while still allowing an agressive approach to trading.
  • #47
  • Aug 24, 2011 2:02am Aug 24, 2011 2:02am
Quoting beachallstar
Livermore definitely knew how to "swing a big line", and how to test the waters first.

Scaling in has alot of different angles too, such as adjusting your stop as you scale in, so if the trend has a massive correction, you don't get wiped out.

Kingusurfer, have you thought about using a "breaker" type approach for martingale? For instance, if you had 5K to start with, divide that into five 1k lots and apply martingale to your 1k lot, instead of the whole 5k.

So if you do blow up, you simply move to the next 1k lot and repeat. And everytime...

Beachallstar,

You understand the system.

It tried explaining to nubcake that you don't leave your profits in the account together with the initial deposit because then you lose all at once if and when you fail. Splitting the deposits/ serial reloading of entire account is one of the fine tunning that I had hoped will come up in course of our optimisation. Certainly your 5 to 1 breaker approach has a lot of merit and should be included as a main component of the strategy.

In my profession this would have been called beachallstar's modification of Kingsurfer's procedure!

King.
  • #48
  • Aug 24, 2011 2:17am Aug 24, 2011 2:17am
Quoting kingsurfer
Beachallstar,

You understand the system.

It tried explaining to nubcake that you don't leave your profits in the account together with the initial deposit because then you lose all at once if and when you fail. Splitting the deposits/ serial reloading of entire account is one of the fine tunning that I had hoped will come up in course of our optimisation. Certainly your 5 to 1 breaker approach has a lot of merit and should be included as a main component of the strategy.

In my profession this would have been called beachallstar's modification...
lol.

so exactly WHAT is the difference between splitting your account, or simply restarting your martingale once you chew through some percentage of the account with the inevitable drawdown? it's exactly the same thing. splitting your account isn't going to extend the life of the strategy any differently. it's simply added complexity for zero benefit.

at the end of the day you will still find yourself restarting your account or progression in a downward spiral that ends in zero funds if you don't have a profitable entry and exit method. if you had a profitable entry exit method then you wouldn't need to use a progression based on losing streaks that attempt to recover the previous losses.

you can't game the system via fancy betting strategies. you need a profitable edge. that's the bottom line. you believe you have some edge, but you also believe you won't experience a streak of losers somewhere above 7. time will tell... but if you are wrong you will keep hitting your risk of ruin point each time you refund your account or restart a progression.

are you currently doing this with live funds, or is this all just a mental exercise?
Congratulations ScalaFX for coming out of the closet!
  • #49
  • Aug 24, 2011 3:18am Aug 24, 2011 3:18am
A screen shot to reinforce some of my explanations.

For almost one year this pair had been swinging up and down.

This is the kind of pair to look for in this strategy.
Attached Image (click to enlarge)
Click to Enlarge Name: 2.gif Size: 34 KB
  • #50
  • Aug 24, 2011 3:32am Aug 24, 2011 3:32am
Quoting nubcake
so exactly WHAT is the difference between splitting your account, or simply restarting your martingale once you chew through some percentage of the account with the inevitable drawdown? it's exactly the same thing. splitting your account isn't going to extend the life of the strategy any differently.

...but you also believe you won't experience a streak of losers somewhere above 7.
I do not use stop losses at all, so any money in the account goes with any loss. I precalcuate what a level seven loss would be and that is the max the account will hold at any time.



Quoting nubcake
...if you don't have a profitable entry and exit method.
...you can't game the system via fancy betting strategies. you need a profitable edge. that's the bottom line.
Nubcake, lets get something straight. I do have a small edge per every trade. It becomes amplified when I string them together in a martingale fashion. Multiply 1.25 by 1.25 by 1.25. What you get is no longer only a 25% edge.



Quoting nubcake
...are you currently doing this with live funds, or is this all just a mental exercise?
My main account is averaging down currently. It uses essentially the same modus operandi. This method is an upgrade in both risk and returns. I am currently testing it out live with a small account. In this thread I'm brainstorming. I am the first to admit that martingale is a dangerous strategy, but one well worth it, hence the extreme caution and preparation.

King.
  • #51
  • Aug 24, 2011 3:43am Aug 24, 2011 3:43am
ah, that explains it then.

i think they only way you could trade any riskier is if you were juggling chainsaws and drunk at the same time as entering your orders.
Congratulations ScalaFX for coming out of the closet!
  • #52
  • Aug 24, 2011 4:36am Aug 24, 2011 4:36am
Can you tell us all the pairs you trade in your system, thank you
  • #53
  • Aug 24, 2011 8:28am Aug 24, 2011 8:28am
Quoting kingsurfer
Thank You.
I do not see it that way. I have been averaging down in my main account and the results are amazing.

Recently I have been trading this way (extended martingale) in my smaller account and have already trippled the small deposit there.

Instead of scare tactics I wish for constructive criticism. Why do you have this feeling?

King.
It doesn't matter how you see it. The stove is hot, whether you think it is or not. Yes, if you are looking to make a small, pre-determined amount martingale can be useful. If you are trying to trade for a living, keep your day job because you WILL be wiped out.

Regards,
  • #54
  • Aug 24, 2011 8:38am Aug 24, 2011 8:38am
Quoting dddd
(anybody with an iq of 100 should know that this will not end well.....)
I love your attitude
Attached Image
  • #55
  • Aug 24, 2011 8:58am Aug 24, 2011 8:58am
Just formulate your own idea king, the people here have formulated their own and are against martingale.. thats where my decision lays.. I found your version interesting and slightly different but to risky for myself

You need to make up your own mind in this game tho.. so consider what others have said with your beliefs and make a decision. I wish you the best of luck in your pursuit..

My last advice would be to run some true statistical research and determine your real probabilities because I personally get the impression you are guessing at how often things go up and down by "levels".



In the end...

After some simple research and backbreaking effort you will be able to do one of two things,

1. Make a fortune.

or..

2. Save a fortune from being thrown away.
  • #56
  • Edited 12:31pm Aug 24, 2011 11:55am | Edited 12:31pm
Quoting Pipalicious
I love your attitude
you are absolutely right. i was out of line. sometimes our prejudices sneak attack on us.
i have deleted the comment.
  • #57
  • Aug 24, 2011 12:57pm Aug 24, 2011 12:57pm
Quoting newyear498
Just formulate your own idea king, the people here have formulated their own and are against martingale.. thats where my decision lays.. I found your version interesting and slightly different but to risky for myself

You need to make up your own mind in this game tho.. so consider what others have said with your beliefs and make a decision. I wish you the best of luck in your pursuit..

My last advice would be to run some true statistical research and determine your real probabilities because I personally get the impression you are guessing at...

Thank you for your comments.

I already knew most people will condemn my method because it is 'too risky'. They want a no-risk-sure-banker approach. I don't have that. I also know some forex forum user are not traders. They are employees of those who have the best interest of traders at heart! They will do everything possible to get us chasing the trend, and laughing when we can't understand why 'we trade they make money'. I'm actually surprised we have been able to come this far in this thread.

Now to real issues. I'm not guessing about levels. Its familiar territory. I have been in countertrend business for over 2 years now and I know 3 levels are not difficult to reach if you did your homework well. What I'm not yet fully familiar with (in practice as against theoritical) is the extra margin that martingale will need over and above the requirements of averaging down. But whether this method will work? I'm absolutely sure.

King.
  • #58
  • Aug 24, 2011 1:29pm Aug 24, 2011 1:29pm
Quoting Pip-postrous
Can you tell us all the pairs you trade in your system, thank you
Presently I trade only UsdCad (over 6 months now) in my main account. In the past I used it with ChfJpy. I'm testing out (live) both of them in my small account for this method. It has been my practice to pick only the best I can find. Occasionally 2 pairs.

As you would expect I have never traded GbpUsd, GbpJpy, EurUsd with this method. They are well known trending pairs.

Later I will furnish more detailed reasons for my choices. I'm actually hoping this will come out as part of our optimization, not for me to give out as a lecture. I also want to improve.

King.
  • #59
  • Aug 24, 2011 2:05pm Aug 24, 2011 2:05pm
hey king
A year and half ago , I started trading martingale grid trading .. I use a free piece of software (blessing) that makes it easy to back test ,, and Iv spent 100,s of hours doing so to develop my style ..As for all these other folks saying you cant make money matindaling , pfffff . glad I did not listen to the so called experts .. a thousand trades later and from 7000 to just under 50,000 in equety while taking a small monthly salery from the account as well (about a 1000 a month) .. keep working your system you are on the right track , but discussing it with folks who,s minds are made up is like talking to religious people , no mater what ,,,your going to hell !!
peace
hemp
Uac,Chicchan,Ahau

http://www.event12.com/mayan_glyphs/hiero/a.pnghttp://www.event12.com/mayan_glyphs/hiero/c.pnghttp://www.event12.com/mayan_glyphs/hiero/comma.pnghttp://www.event12.com/mayan_glyphs/hiero/c.pnghttp://www.event12.com/mayan_glyphs/hiero/n.png
  • #60
  • Aug 24, 2011 2:22pm Aug 24, 2011 2:22pm
Quoting kingsurfer
Presently I trade only UsdCad (over 6 months now) in my main account. In the past I used it with ChfJpy. I'm testing out (live) both of them in my small account for this method. It has been my practice to pick only the best I can find. Occasionally 2 pairs.

As you would expect I have never traded GbpUsd, GbpJpy, EurUsd with this method. They are well known trending pairs.

Later I will furnish more detailed reasons for my choices. I'm actually hoping this will come out as part of our optimization, not for me to give out as a lecture. I also want...
thanks, I look forward to your progress
0 traders viewing now