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  • #361
  • Sep 8, 2014 6:01am Sep 8, 2014 6:01am
Quoting micmic
{quote} Unfortunately, in such a case you could face a margin call even with a very tight stop loss. Very often in these spikes price moves immediately thousands of pips away. Since the movement is not gradual, your stop loss won't matter. Just like it happened today: Someone may have been long in GBUSD with SL at 1.6275 when the markets closed on Friday, but since the pair opened at 1.6166, he will lose an extra 109 pips. Many times however, spikes like the one in your image are just software glitches that will be corrected by any respectable broker...
Yep, and i`m not a lawyer or anything, but i think in accordance with regulation agreements especially here in the EU the MiFid must enforce the best market conditions to the traders so probably these losses need to be compensated, because it was more like a "disaster" than a common market movement, and probably 99% of (retail) traders lost money on that move, they should be compensated atleast the minimum amount, but its just a guess
"There's a sucker born every minute" - P.T. Barnum
  • #362
  • Sep 8, 2014 6:36am Sep 8, 2014 6:36am
Quoting PipMeUp
{quote} You can write in BIG, in bold or in blue to help convincing yourself that's won't change the facts. Your psychologically twisted dice makes things even worse because you don't know how it is biaised and this biais changes over time. Martingale is only a matter of faith. Keep believing.
I am not here to convince anyone, just highlighting the more important parts of this "game theory" strategy. It is not even my invention so I have no "ego" attached to defend it.

Anyway, going for max. Level_4 entries (i.e. 15 units max. SL) the strategy has not had a single losing day since the beginning of August. In other words: the EURUSD market seems to move 10 or at least 20 pips in one direction with at least some level of "conviction" after LO and NYO. Sure, five weeks sampling is nothing statistically, but it is a "good start". (By the way, today was another 10 pips winner buying the EURUSD at London open; now just waiting for New York open.)

P.S. No more highlights...
  • #363
  • Sep 8, 2014 8:13am Sep 8, 2014 8:13am
Quoting Paracelsus
{quote}(By the way, today was another 10 pips winner buying the EURUSD at London open; now just waiting for New York open.)
Any strategy making you buy EUR in this kind of market condition is bullshit. period. Learn how to trade.
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  • #364
  • Sep 8, 2014 8:16am Sep 8, 2014 8:16am
Quoting LITEchild
{quote} Any strategy making yo buy EUR in this kind of market condition is bullshit. period.
I am happy with my net +10 pips profited from the "bullshit" EURUSD "buy" trade (the first short trade was a SL).

This screenshot tells all:

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  • #365
  • Sep 8, 2014 8:48am Sep 8, 2014 8:48am
Quoting Paracelsus
{quote} I am happy with my net +10 pips profited from the "bullshit" EURUSD "buy" trade (the first short trade was a SL). This screenshot tells all: {image}
More bullshit. You keep shooting yourself in the foot. Why 20 pips on your chart??? After buying from 2945 the highest price went was 2957 which is exactly 12 pips! Mind showing the closed trades with a screen shot? Just drag from account history unto the chart. I won't hold my breath...
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  • #366
  • Edited 9:16am Sep 8, 2014 9:04am | Edited 9:16am
Quoting LITEchild
{quote} More bullshit. You keep shooting yourself in the foot. Why 20 pips on your chart??? After buying from 2945 the highest price went was 2957 which is exactly 12 pips! Mind showing the closed trades with a screen shot? Just drag from account history unto the chart. I won't hold my breath... {image}
@LITEchild
Probably you have not looked at the strategy itself:

1st trade: 1 unit
2nd (reverse) trade: 2 units
3rd (re-reverse) trade: 4 units
4th (re-re-reverse) trade: 8 units
No 5th trade. Final SL (-15 units) is taken with the 4th trade. Never happened (yet).

This is the link to the original strategy's thread (aplogies from Proximus for this sidetrack; I delete this entry upon request): http://www.forexfactory.com/showthread.php?t=501215

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  • #367
  • Sep 8, 2014 9:16am Sep 8, 2014 9:16am
Quoting Paracelsus
Never happened (yet).
What is your sample size for 4th level trades.
  • #368
  • Sep 8, 2014 9:35am Sep 8, 2014 9:35am
Quoting Paracelsus
{quote} @LITEchild Probably you have not looked at the strategy itself: 1st trade: 1 unit 2nd (reverse) trade: 2 units 3rd (re-reverse) trade: 4 units 4th (re-re-reverse) trade: 8 units No 5th trade. Final SL (-15 units) is taken with the 4th trade. Never happened (yet). This is the link to the original strategy's thread (aplogies from Proximus for this sidetrack; I delete this entry upon request): http://www.forexfactory.com/showthread.php?t=501215 {image}
ok. You get credits for at least being honest about actually taking the trade. But, like the owner of that thread stated, What you're doing is extremely risky!; That is in an already 'risky' venture, you're adding even more risk!!! Do you realise how many traders have already gone down that route in FF? I haven't seen even one that has 'lived' to tell the tale. Even If I would consider doing what you're doing now, I would start off with a high probability setup. Not buying in an obvious down market, and selling in an obvious up market( I mean the 1st unit entry). How many 4th unit losses in a row can your account handle? It hasn't happened yet, doesn't mean It's not gonna happen! Would you be dumb enough to even try this on a live account? Take my advice my friend and learn how to trade. Period. You posted this picture on that thread. Why not take your own advice?
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  • #369
  • Sep 8, 2014 10:23am Sep 8, 2014 10:23am
Quoting LITEchild
{quote} ok. You get credits for at least being honest about actually taking the trade. But, like the owner of that thread stated, What you're doing is extremely risky!; That is in an already 'risky' venture, you're adding even more risk!!! Do you realise how many traders have already gone down that route in FF? I haven't seen even one that has 'lived' to tell the tale. Even If I would consider doing what you're doing now, I would start off with a high probability setup. Not buying in an obvious down market, and selling in an obvious up market( I...
Well, I can afford forward testing while waiting for my EA to backtest the average frequency of Level4, i.e. -15 units stop losses.

Setting the SL at 5% of the account size, I could face even a 4-series SL (i.e. -20%). But it should be more of a "purple swan"than a "black swan" event...
  • #370
  • Edited 1:49pm Sep 8, 2014 10:24am | Edited 1:49pm
Quoting euclid
{quote} What is your sample size for 4th level trades.
Today was the first time with a 4th entry. No real sample size. Historically Mondays are the slowest.

(Max. SL is taken after the 4th level entry, so for me it is NOT a "no SL" system.)

09/05/2014:
LO: +10 pips (with 1st entry according to original strategy's entry direction)
NYO: +10 pips (with 4th entry according to original strategy's entry direction)
  • #371
  • Sep 8, 2014 12:29pm Sep 8, 2014 12:29pm
Quoting Proximus
{quote} all NO SL SYSTEMS ARE BIG B.S.,and have no real edge
+++1 ..
  • #372
  • Sep 8, 2014 7:22pm Sep 8, 2014 7:22pm
Sorry Paracelsus but martingale is just simply not viable.I`ve ran many simulations and on average with an account <=10.000$, you lose the entire account before the 1000th trade if you start with the smallest lot size 0.01 and double until the highest.

If you put a cap lets say 4th level (2^4) then you can survive longer, however your equity curve will go down, as a 2^4 loss situation is more probable than a 2^19
(5,242.88$) thats if you are willing to risk the entire 10.000$, but that would be madness.So anyway a 2^4 loss you would lose constantly 0.16$, supposing if 1 pip is 0.01$ and you only trade 1 pip positions.

Now it could be different for your model, i dont know what TP , SL you use, but eventually it will lose all your money.Martingale is a 100% guaranteed way to lose your account as fast as possible.
"There's a sucker born every minute" - P.T. Barnum
  • #373
  • Sep 8, 2014 11:54pm Sep 8, 2014 11:54pm
Quoting LITEchild
{quote} ok. You get credits for at least being honest about actually taking the trade. But, like the owner of that thread stated, What you're doing is extremely risky!; That is in an already 'risky' venture, you're adding even more risk!!! Do you realise how many traders have already gone down that route in FF? I haven't seen even one that has 'lived' to tell the tale. Even If I would consider doing what you're doing now, I would start off with a high probability setup. Not buying in an obvious down market, and selling in an obvious up market( I...
You could get lucky and make a million $ with martingale, but thats has just about as much odds as winning the lottery, and a lottery ticket costs only 2 €, while this would cost him the entire account ...

What's inside the box in that picture, an axe which chops off his finger ?
"There's a sucker born every minute" - P.T. Barnum
  • #374
  • Sep 9, 2014 2:33am Sep 9, 2014 2:33am
Quoting Proximus
Sorry Paracelsus but martingale is just simply not viable.I`ve ran many simulations and on average with an account <=10.000$, you lose the entire account before the 1000th trade if you start with the smallest lot size 0.01 and double until the highest. If you put a cap lets say 4th level (2^4) then you can survive longer, however your equity curve will go down, as a 2^4 loss situation is more probable than a 2^19 (5,242.88$) thats if you are willing to risk the entire 10.000$, but that would be...
R:R = 1:1 (10 pips each)

The strategy's hypothesised edge is based on the likely increased market volatility when "fresh money" comes in at London Open. Today's LO was another profitable trade within 15 minutes. So far no losing trades for the past 5-6 weeks (LO & NYO), so this - very limited - forward test is at 50:0 Win:Loss ratio as of now (2x5 winners per week), but even with a 20:1 ratio, it would be still profitable.

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  • #375
  • Sep 9, 2014 3:00am Sep 9, 2014 3:00am
Quoting Paracelsus
{quote} R:R = 1:1 (10 pips each) The strategy's hypothesised edge is based on the likely increased market volatility when "fresh money" comes in at London Open. Today's LO was another profitable trade within 15 minutes. So far no losing trades for the past 5-6 weeks (LO & NYO), so this - very limited - forward test is at 50:0 Win:Loss ratio as of now (2x5 winners per week), but even with a 20:1 ratio, it would be still profitable. {image}
If you had no losses so far, and presumably will have high winrate in the future, then why do you need to martingale?

Just keep the risk constant, play safe and cash in the money
"There's a sucker born every minute" - P.T. Barnum
  • #376
  • Sep 9, 2014 3:34am Sep 9, 2014 3:34am
Quoting Proximus
{quote} If you had no losses so far, and presumably will have high winrate in the future, then why do you need to martingale? Just keep the risk constant, play safe and cash in the money
The high win rate comes with the added Martingale.

What is interesting that the results - so far - go against the "expected" 15:1 W:L. There "should" have been (statistically) at least one loss for each 14 trades. Maybe just an anomaly...? Or maybe the price movements - after the "opens" - are not as random as a dice...?
  • #377
  • Sep 9, 2014 3:54am Sep 9, 2014 3:54am
Quoting Paracelsus
{quote} The high win rate comes with the added Martingale. What is interesting that the results - so far - go against the "expected" 15:1 W:L. There "should" have been (statistically) at least one loss for each 14 trades. Maybe just an anomaly...? Or maybe the price movements - after the "opens" - are not as random as a dice...?
Probability is not a guarantee, having a 99% winrate doesnt mean that every time you win 99 trades out of 100, it means that in average you do.

I dont understand how martingale improves the winrate, when it only increases the risk of account wipeout.
"There's a sucker born every minute" - P.T. Barnum
  • #378
  • Sep 9, 2014 4:04am Sep 9, 2014 4:04am
It seems like any and all strategies that feature any kind of doubled re-entries on losing positions is called Martingale. This is NOT Martingale. You can call it "modified Martingale", "limited Martingale" or something similar. But it's better not to call it Martingale at all, because the term has been associated with indefinite doubling of position size. The bad reputation of Martingale comes exactly from this doubling ad infinitum, which of course can't be sustained. If there is a hard stop loss in place, then it's NOT Martingale.
  • #379
  • Sep 9, 2014 4:09am Sep 9, 2014 4:09am
Quoting micmic
It seems like any and all strategies that feature any kind of doubled re-entries on losing positions is called Martingale. This is NOT Martingale. You can call it "modified Martingale", "limited Martingale" or something similar. But it's better not to call it Martingale at all, because the term has been associated with indefinite doubling of position size. The bad reputation of Martingale comes exactly from this doubling ad infinitum, which of course can't be sustained. If there is a hard stop loss in place, then it's NOT Martingale.
Thanks for the excellent and well-needed clarification, MicMic!
  • #380
  • Sep 9, 2014 4:12am Sep 9, 2014 4:12am
Quoting micmic
It seems like any and all strategies that feature any kind of doubled re-entries on losing positions is called Martingale. This is NOT Martingale. You can call it "modified Martingale", "limited Martingale" or something similar. But it's better not to call it Martingale at all, because the term has been associated with indefinite doubling of position size. The bad reputation of Martingale comes exactly from this doubling ad infinitum, which of course can't be sustained. If there is a hard stop loss in place, then it's NOT Martingale.
Doesnt matter how you call it, or how you modify it, it is the same.You can perhaps stall more with "modified versions" but the account wipeout is inevitable.

Why?

Simple, PipMeUp already explained it many many times, and there is like 50 threads in this forum about the martingale fallacy, but the main reason why it fails ,with every other recovery based strategies is because they increase the profits linearly while the risk is increasing exponentially, its math proof, you cant cheat the numbers.

So please lets not make my thread a martingale discussion guys because there are already 50 threads about this out there, its a fact that it will not work, go and check the evidence.

http://en.wikipedia.org/wiki/Marting...cal%20analysis
http://web.stanford.edu/~lutian/coursepdf/survweek7.pdf

Now lets get back to the main topic
"There's a sucker born every minute" - P.T. Barnum
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