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How to rescue a losing position?

  • #281
  • Jan 7, 2013 1:45pm Jan 7, 2013 1:45pm
Quoting onitron
A position that goes against you is not necessarily a losing position. If you think it still has the potential to be closed at a profit, you shouldn't care about the temporary loss - it is a cost of doing business. If you think, your original idea to put the position is no longer valid, then you really have a losing position. The best way to rescue it, is to close it, and save your account so you can open another position with a better odds of success. The point of trading and investing, is to keep your money in the best possible asset/trade at...

Positions which go against you will always happen, the trick is not holding on to long, as soon as the momentum is going the wrong way you want to be out and possibly flipped to the other side.

I used to let them run against me to differing MA's but more often than not if it has the strength to get there, it won't reverse it keep on going.
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #282
  • Jan 12, 2013 7:16pm Jan 12, 2013 7:16pm
I prefer to do a stop and reverse strategy however I know that risk to reward will be off but I would cut my loss early as 95% of the time the move against me is so volatile and usually moves 50+ plus against me most the time doing a quick stop and reverse enables me to start recouping my loss quickly to at least breakeven or small profit. I can take 2 losses per day. Remember 1 great 80-100point trade a week can recoup all your loss its all a number game the more trades = more winners or losers plus you will learn quicker as well. I hate missing huge moves sitting there till the next day waiting for another opportunity.
Find your Favourite Pattern
  • #283
  • Jan 12, 2013 7:38pm Jan 12, 2013 7:38pm
Quoting onitron
A position that goes against you is not necessarily a losing position. If you think it still has the potential to be closed at a profit, you shouldn't care about the temporary loss - it is a cost of doing business. If you think, your original idea to put the position is no longer valid, then you really have a losing position. The best way to rescue it, is to close it, and save your account so you can open another position with a better odds of success. The point of trading and investing, is to keep your money in the best possible asset/trade at...
this is true...but again it goes against some principles discussed here by hanover and myself

mathematical consistency and positive expectancy.


you need to act like a casino and on the long run come up net positive.

by having less than a rigorous approach to money management you can end up with asymmetrical returns, and big heavy tails....let's say you were short at 1.32 now it's 1.3340 how long will you let it run till you think you are wrong 1.40, 1.45? and that being the case you will have some big losses that will wipe out many small gains.

what you want to do, or it is in my opinion, more efficient to do is to have a pre -determined max loss limit in mind which is 85% or so of what your average wins are . ....if you want to be lax about it.

even better to ALWAYS lose 85% of your previous gain...and you are guaranteed to come up on top if your analysis is at least 50% hit rate.


I could be wrong but at this point I believe this to be the most efficient way.
AVT INVENIAM VIAM AVT FACIAM
  • #284
  • Jan 12, 2013 7:47pm Jan 12, 2013 7:47pm
Quoting the redlion
this is true...but again it goes against some principles discussed here by hanover and myself

mathematical consistency and positive expectancy.


you need to act like a casino and on the long run come up net positive.

by having less than a rigorous approach to money management you can end up with asymmetrical returns, and big heavy tails....let's say you were short at 1.32 now it's 1.3340 how long will you let it run till you think you are wrong 1.40, 1.45? and that being the case you will have some big losses that will wipe out many small gains.

what...

Yep, risking a small amount 7 - 9 pips in my case with the potential of making 10 - 100pips, it's about having a method which gets you in with the potential for such a return then the balls to hold for such a return.

My historic charts are all, small profit, small profit at times 85% win rate, then a HUGE loss which wipes it all out, trying to reverse this, small loss small loss, HUGE profit which puts me well on top.

Method is there, balls well that's the next issue I guess.
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #285
  • Jan 12, 2013 8:20pm Jan 12, 2013 8:20pm
Quoting Turveyd
Yep, risking a small amount 7 - 9 pips in my case with the potential of making 10 - 100pips, it's about having a method which gets you in with the potential for such a return then the balls to hold for such a return.

My historic charts are all, small profit, small profit at times 85% win rate, then a HUGE loss which wipes it all out, trying to reverse this, small loss small loss, HUGE profit which puts me well on top.

Method is there, balls well that's the next issue I guess.
now you got risk of death by a 1000 stops.


9 pip stop increases volatility risk....10 stop out's in a row for you is 70 to 90 pips....so you need a big win to make out for this, hope this works for you.


I think the key is finding the balance between volatility risk and momentum risk in other words to be lax enough to account for normal oscillations and tight enough and disciplined enough to be consistently less than your profits....... let me know if you find it

so far I have a working system but is far from what i would consider it to be optimal efficiency
AVT INVENIAM VIAM AVT FACIAM
  • #286
  • Jan 12, 2013 8:23pm Jan 12, 2013 8:23pm
Quoting Turveyd
Yep, risking a small amount 7 - 9 pips in my case with the potential of making 10 - 100pips, it's about having a method which gets you in with the potential for such a return then the balls to hold for such a return.

My historic charts are all, small profit, small profit at times 85% win rate, then a HUGE loss which wipes it all out, trying to reverse this, small loss small loss, HUGE profit which puts me well on top.

Method is there, balls well that's the next issue I guess.
7-9 pips in eurusd.... probably testing limits with 10 contracts position - market may get after you ?
  • #287
  • Jan 12, 2013 8:32pm Jan 12, 2013 8:32pm
Quoting the redlion
now you got risk of death by a 1000 stops.


9 pip stop increases volatility risk....10 stop out's in a row for you is 70 to 90 pips....so you need a big win to make out for this, hope this works for you.


I think the key is finding the balance between volatility risk and momentum risk in other words to be lax enough to account for normal oscillations and tight enough and disciplined enough to be consistently less than your profits....... let me know if you find it

so far I have a working system but is far from what i would consider it to be...

Death by a 1000nd cuts is looking possible, as I've had a row of small losers while fixing the bugs / mindset mainly.

Shouldn't get 10 if I've got my math's right, should get ~60% win rate, but downside is I can only play on strong ish market days like the last 2 days, IF I get bored and try playing in chop Win % is going to drop a lot.

The far out stops don't work for me, I have a run of winners, really don't want to lose get emotional and makes a HUGE loss, done it way to often, so fixed SL and sL removed from my screen so can't change it is working better I think.

It's never easy unfortunately and I guess it never will be.

It is odd how I pretty much literally can't get a winning trade recently, few months back couldn't lose for trying, back to Demo while I sort my head out!
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #288
  • Jan 12, 2013 8:37pm Jan 12, 2013 8:37pm
Quoting macroman
7-9 pips in eurusd.... probably testing limits with 10 contracts position - market may get after you ?

6 + Spread is my SL, be 9 on EU not that I trade EU it's spreads shot up recently and doesn't move well enough to justify it, DAX, EJ and GU personally.

It's all about, jumping on a up move mid way through at a relatively safe spot then holding till it's no longer going up.

Ofcourse next week, the market will stop doing that and back to looking for a method which works in current conditions AGAIN!!
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #289
  • Jan 13, 2013 2:17pm Jan 13, 2013 2:17pm
rescue a losing hand : best method when your long ... to keep buying when market is against you ... this way you will reduce your price ... for example if you bought 1 lot EUR @ 1.3200 and market went against you 100 pip ... now you buy another lot @ 1.3100 ... now your average price is 1.3150 ... and so on ... if your short just do the opposite method ...
let the chart to be your chauffeur ... -Forexmnstr-
  • #290
  • Jan 13, 2013 2:27pm Jan 13, 2013 2:27pm
The sure fire way to blow your account ^^^ you'll get away with it a few times... then one day it will just keep going and never come back. Brilliant, i will buy more cos its so much cheaper now... except you've lost all perspective of how big a position you actually hold now...

Oh the nights of no sleep, the burning hot flushes... the relief of finally closing that position and recognising the huge loss.... if only you had closed it earlier... much earlier! )
GoFundMe -stage-4-glioma-brain-cancer-fighter (link in my profile)
  • #291
  • Jan 13, 2013 2:55pm Jan 13, 2013 2:55pm
Quoting forexmnstr
rescue a losing hand : best method when your long ... to keep buying when market is against you ... this way you will reduce your price ... for example if you bought 1 lot EUR @ 1.3200 and market went against you 100 pip ... now you buy another lot @ 1.3100 ... now your average price is 1.3150 ... and so on ... if your short just do the opposite method ...



ridiculous
SEE LINE,TRADE LINE..PRICE HAS TO GO SOMEWHERE,,, PRICE WILL GO SOMEWHERE.
  • #292
  • Jan 13, 2013 3:13pm Jan 13, 2013 3:13pm
Quoting forexmnstr
rescue a losing hand : best method when your long ... to keep buying when market is against you ... this way you will reduce your price ... for example if you bought 1 lot EUR @ 1.3200 and market went against you 100 pip ... now you buy another lot @ 1.3100 ... now your average price is 1.3150 ... and so on ... if your short just do the opposite method ...

It's kinda okay to do twice, but diminishing returns after that.

Buy a 3rd position at 1.3000 and then Avg drops to 1.31, 100 pips away.

Buy a 4th position at 1.2900 and then your avg drops to 1.305, 150 pips away.

You might get away with it 90% of the time, but that 10% is a bitch when it moves 600pips against you, your avg 300pips down, with 5 losing lots = 1500pips down.

If only it was that easy!!
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #293
  • Jan 13, 2013 4:03pm Jan 13, 2013 4:03pm
Quoting forexmnstr
rescue a losing hand : best method when your long ... to keep buying when market is against you ... this way you will reduce your price ... for example if you bought 1 lot EUR @ 1.3200 and market went against you 100 pip ... now you buy another lot @ 1.3100 ... now your average price is 1.3150 ... and so on ... if your short just do the opposite method ...
Whaaoo great idea! I suppose you close when back at break even? So risking QUADRATICALLY (N²) to hope for... ZERO!
Very good R:R.
Do you realize at 4th level you're already down 1000pips (100+200+300+400)?
Do you know the BE point is always at the half of your grid?

You think it doesn't happen often enough to be dangerous?
Just have a look at E/U mid-August, even the range in the middle of the rally would not have been wide enough to save a short "losing hand". 800 pips against you => 3600 pips net in the red.
Not convinced have a look at May => 1000 pips move for a net grid of -5500pips!
Nov 2011, 1500pips. Net -12000!
When do you stop? MC? How do you cover that?
No greed. No fear. Just maths.
  • #294
  • Jan 13, 2013 5:29pm Jan 13, 2013 5:29pm
Quoting Turveyd
It's kinda okay to do twice, but diminishing returns after that.

Buy a 3rd position at 1.3000 and then Avg drops to 1.31, 100 pips away.

Buy a 4th position at 1.2900 and then your avg drops to 1.305, 150 pips away.

You might get away with it 90% of the time, but that 10% is a bitch when it moves 600pips against you, your avg 300pips down, with 5 losing lots = 1500pips down.

If only it was that easy!!
this will actually work ... if you keep feeding your account ... never let the stop trigger ... ( the guys that think it wont work ... it works 100% ) ... ask the one who tried it dont ask the one who act as if he tried it
let the chart to be your chauffeur ... -Forexmnstr-
  • #295
  • Jan 13, 2013 5:30pm Jan 13, 2013 5:30pm
Quoting billytt
ridiculous
let the chart to be your chauffeur ... -Forexmnstr-
  • #296
  • Jan 13, 2013 5:34pm Jan 13, 2013 5:34pm
Quoting forexmnstr
this will actually work ... if you keep feeding your account ... never let the stop trigger ... ( the guys that think it wont work ... it works 100% ) ... ask the one who tried it dont ask the one who act as if he tried it

Do you think someone held GU from 2.1 to 1.3 ish and bought all the way down

$8000 on the first pos at $1 per pip, + $7900 +7800 +7700 = -$324,000 at some stage!!
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #297
  • Jan 13, 2013 11:43pm Jan 13, 2013 11:43pm
Quoting macroman
7-9 pips in eurusd.... probably testing limits with 10 contracts position - market may get after you ?
don't feed the troll this guy is a roundabout. going in circles
The best indicator is price.
  • #298
  • Jan 13, 2013 11:45pm Jan 13, 2013 11:45pm
Quoting Turveyd
Death by a 1000nd cuts is looking possible, as I've had a row of small losers while fixing the bugs / mindset mainly.

Shouldn't get 10 if I've got my math's right, should get ~60% win rate, but downside is I can only play on strong ish market days like the last 2 days, IF I get bored and try playing in chop Win % is going to drop a lot.

The far out stops don't work for me, I have a run of winners, really don't want to lose get emotional and makes a HUGE loss, done it way to often, so fixed SL and sL removed from my screen so can't change...
when will you wake up and smell the coffee, this type of sniper trading will never work in the long run, 1 min 6-10 pip snipping is for wide eyed newbies that just found the MACD cross over.
The best indicator is price.
  • #299
  • Jan 13, 2013 11:57pm Jan 13, 2013 11:57pm
Quoting forexmnstr
rescue a losing hand : best method when your long ... to keep buying when market is against you ... this way you will reduce your price ... for example if you bought 1 lot EUR @ 1.3200 and market went against you 100 pip ... now you buy another lot @ 1.3100 ... now your average price is 1.3150 ... and so on ... if your short just do the opposite method ...
Losers average losers — Jack explains it brilliantly here.
  • #300
  • Jan 14, 2013 12:13am Jan 14, 2013 12:13am
Quoting forexmnstr
this will actually work ... if you keep feeding your account ... never let the stop trigger ... ( the guys that think it wont work ... it works 100% ) ... ask the one who tried it dont ask the one who act as if he tried it

You have to ask yourself, if its just a wind up merchant!

That's a really professional approach.... NOT!


So at what stage do you reach your max 3% trade risk?

Trust me, i used to average down many moons and a couple of accounts ago... Its pure gambling and totally for guys who want an easy route out.

This isn't an easy game, people don't realise the work that has to be done to trade successfully. They are the ones who repeatedly lose and fall by the wayside.
GoFundMe -stage-4-glioma-brain-cancer-fighter (link in my profile)
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