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No Loss Martingale Strategy

  • #201
  • Sep 25, 2015 11:16pm Sep 25, 2015 11:16pm
Quoting ollaya
i found this searching in google : So cool , this is how to calculate the probality using Chrome : " Here's a way to get an approximation for the answer via a simulation. It's kinda fun to tweak the numbers and see the probability change. Run this in Tools -> Javascript Console in Chrome or Tools -> Web Developer -> Web Consolein FireFox: function experiment(streak, tosses) { var i, ctr = 0; for (i = 0; i < tosses; i++) { if (Math.random() < 0.5) ctr = 0; else if (++ctr === streak) return 1; } return 0; } function run(streak, tosses, runs) { var...
Yeah tired it works as you said... results just as said.
  • #202
  • Sep 26, 2015 3:34am Sep 26, 2015 3:34am
Attached Image


Any body knows an EA that implement that?
  • #203
  • Sep 26, 2015 5:29am Sep 26, 2015 5:29am
Please don't trade this strategy. The ping pong price retracement lots will kill your account in a ranging market.
  • #204
  • Sep 26, 2015 7:29am Sep 26, 2015 7:29am
Quoting flowerhorn
Please don't trade this strategy. The ping pong price retracement lots will kill your account in a ranging market.
So yeah, the same way a grid martingale recovery kills it in a trending market. Always a flipside of the coin. The key of success is HOW to use it!
  • #205
  • Sep 26, 2015 8:20am Sep 26, 2015 8:20am
Ohh the old martingale..... a big trap really. Even some experienced traders get trapped. Mainly due to psychological reasons.(the ego hates to lose) It's a sure way to go broke in no time! The other "light" version of the same trap is adding to losing trades.(averaging down). No matter how you do it, it ALWAYS produces negative expectancy long term.
No loss trading strategy is oxymoron really! Mathematical and statistical impossibility. You have to lose in order to win long term. There is no way around it.
If you study the strategies and methods of ALL big traders in history that made huge amounts of money, you will find some common pattern. - Most of them lose quite often, AND add (average up) aggressively on winning positions to take advantage of exponential trends ( the persistent momentum anomaly). Why they do it? Because that's pretty much the only way to make big money in this game! The other way is to use symmetrical approach with 1:1 stop:target and rely on high win rate.( its not easy to sustain long term).
I know some people will disagree with me and that's OK. Just keep in mind that even some nobel laureates in math and physics fall in the trap of the Loss avoidance methods. Check the story of LTCM and their "dynamic hedging theory". For 2 years they made amazing returns (billions of dollars) and went bust in the end.
  • #206
  • Edited 10:07am Sep 26, 2015 8:48am | Edited 10:07am
I think this guy is using martingale, Rank #1 in forex factory
  • #207
  • Sep 26, 2015 9:03am Sep 26, 2015 9:03am
Quoting alphaomega
Ohh the old martingale..... a big trap really. Even some experienced traders get trapped. Mainly due to psychological reasons.(the ego hates to lose) It's a sure way to go broke in no time! The other "light" version of the same trap is adding to losing trades.(averaging down). No matter how you do it, it ALWAYS produces negative expectancy long term. No loss trading strategy is oxymoron really! Mathematical and statistical impossibility. You have to lose in order to win long term. There is no way around it. If you study the strategies and methods...
Its clear that using martingale by just multiplying your lot size will eventually fail. but not smart and controlled martingale based strategies!
  • #208
  • Sep 26, 2015 10:56am Sep 26, 2015 10:56am
so whats the difference between martingale without edge VS any other system without edge ?
  • #209
  • Sep 26, 2015 11:02am Sep 26, 2015 11:02am
Quoting metta87
so whats the difference between martingale without edge VS any other system without edge ?
the martingale, trying to recover your losses, and finally win!
  • #210
  • Edited 11:48am Sep 26, 2015 11:19am | Edited 11:48am
i think one of the difference between successful martingale traders with the others, is that they do not add their trades until they know that the trend is returning.
eg:

Attached Image (click to enlarge)
Click to Enlarge Name: Heiken-ashi-Analysis.png Size: 273 KB

  • #211
  • Sep 26, 2015 12:14pm Sep 26, 2015 12:14pm
Quoting She1
i think one of the difference between successful martingale traders with the others, is that they do not add their trades until they know that the trend is returning. eg: {image}
That is EXACTLY SHe1 how the martingale should work and there is nothing written in stone that you have to double your position on every entry. Perhaps you get a divergence, but everything still going pretty much against you. Does any one knows if that divergence is going to work out or not? Of course, no one knows but since you still find reasons to keep your original position open, you can add the same amount of lot(s) instead of doubling it.
Also, and this I preach in my thread, you should trade lot size based on your account size (obvious) and have a maximum amount of % that you are willing to risk. After that, it just becomes a losing trade, the reason for the original entry is long gone, etc.
There are too many variables and too many ways to do it to just disregard it because it will blow your account. We all, or most of us, use more than 1 timeframe to make our decision, I personally use about 4 to 5 and not even when all of them agree, the trades go my way automatically. Besides, trading is about areas, not specific entry, stop and target points.
How many times I have placed my stop just to get stopped out and then go my way. It just happened to me this week with CADJPY after I went short at 90.43. My daily chart (which is 1 of the 2 I use to find main direction) gave me a sell signal, scroll down to confirm areas, everything confirmed, went to entry chart, placed order and fell into the "stop loss trap". Placed my stop loss and my target and guess what? Instead of adding another position short on the bounce, I got stopped out and then it just crashed down, the expected direction.
My "martingale theory" is: You can hardly pick the top or bottom, so scale your entries and keep the stop loss based on a percentage of what you are willing to lose. That percentage translated to a $$ amount will tell you if you double up in the next entry and keep doubling or if you use any other multiplier.
My 2 cents.
  • #212
  • Sep 26, 2015 12:46pm Sep 26, 2015 12:46pm
Quoting flowerhorn
Please don't trade this strategy. The ping pong price retracement lots will kill your account in a ranging market.
Flowerhorn, I fail to see your point. If you were talking about a trending market, then I can see how going against the trend AND DOUBLING your size can blow up your account. But in a ranging market? That would be the best place to use even the original martingale strategy.
I will run thru 3 different scenarios that can happen on a ranging market
1) Say suppose, the range is 200 pips and I'm stupid enough to buy in the middle of the range after price have been coming down. MOst likely the price will keep coming down to the bottom of the range before it bounces again and that is where I can ADD the extra lots (say 2 to double the original position). Most likely again, the price will bounce to retest the top of the top of the range, but even only approaching the middle of the range I'm on the positive side already. Its up to me if I want to get out completely, partially, place a stop loss to capture some profit, break even, I mean endless options.
2) Again, 200 pip range, and now I'm not stupid, I am an IMBECILE for buying at the top of the range, perhaps expecting a break out to the upside. (The usual way is to wait for the break out and then a retest of the top of the range to see if it serves as support) Now price starts going against me. WHY in the world will I add, specially double in size, when say it's 50 pips against me, or 100 pips (at the middle of the range). If its dropping from the top of the range, I'm looking for price to reach the bottom of the range and there is where I can decide if I want to add or not (most likely I should wait for a bounce confirmation before adding, but then again my IQ as a trader might be lower than my 8 year old), and
3) I am still the IMBECILE on number 2 and price broke down thru the bottom support of the range. Again, why would I add? What I should be looking for is a retest of that bottom support that now has become resistance and GET OUT with a loss. Get ready for next trade.

One point, if you dont want to feel like you are going to lose a lot, hedge with comparable pairs. CHFJPY and EURJPY move usually in opposite directions as well as EURUSD and USDCHF, GBPJPY & GBPUSD, NZDUSD & AUDUSD in the same direction and I could go on and on. So if one trade is not going your way, hedge with a comparable pair until the trade starts going your way. NOt the best strategy, but at least if you can't pull the trigger to get out, you start minimizing your loses.
This time is my 3 cents.
  • #213
  • Sep 26, 2015 9:20pm Sep 26, 2015 9:20pm
Hey rck66,

I am referring to She1 strategy below:

http://www.forexfactory.com/attachme...1&d=1443256421

As you can see, if price ping pong along the 2 price levels, the additional lots will keep getting bigger and bigger. (1,2,3,6,12,24.....). And very soon the account will run out of margin to open additional lots. And with each additional lots, the pip values will increase. If price doesn't go to the direction of the latest lots opening, one can kiss goodbye to the account.
  • #214
  • Sep 27, 2015 10:35am Sep 27, 2015 10:35am
well i give up the ping pong strategy, but did you pay attention to these good martingale results?
  • #215
  • Sep 27, 2015 2:55pm Sep 27, 2015 2:55pm
Quoting flowerhorn
Hey rck66, I am referring to She1 strategy below: {image} As you can see, if price ping pong along the 2 price levels, the additional lots will keep getting bigger and bigger. (1,2,3,6,12,24.....). And very soon the account will run out of margin to open additional lots. And with each additional lots, the pip values will increase. If price doesn't go to the direction of the latest lots opening, one can kiss goodbye to the account.

We all know the danger of martingale. The reality is you do have systems in which you can get the same R:R as the previous order, without experiencing a very long losing stream. I found this thread over the weekend and the results look very very very good to use with martingale. http://www.forexfactory.com/showthread.php?t=554842
  • #216
  • Sep 27, 2015 3:31pm Sep 27, 2015 3:31pm
Quoting WhyDrawdown
{quote} We all know the danger of martingale. The reality is you do have systems in which you can get the same R:R as the previous order, without experiencing a very long losing stream. I found this thread over the weekend and the results look very very very good to use with martingale. http://www.forexfactory.com/showthread.php?t=554842
The strategy is just saying that we enter after support/resistance break, am i right? because it looks good when you look at a formed chart but in practice you see it doesn't work, any way have you tried it?
  • #217
  • Sep 27, 2015 4:01pm Sep 27, 2015 4:01pm
Quoting She1
{quote} The strategy is just saying that we enter after support/resistance break, am i right? because it looks good when you look at a formed chart but in practice you see it doesn't work, any way have you tried it?
I would suggest that you read the first 6 pages.
Another thing is that if something looks good in a formed chart (dead chart), when you look at it LIVE and it doesnīt look the same, it is because you arenīt Looking at the LIVE chart as you should. Within that thread, someone mentioned that if you are looking at a 5m chart, as an example, What happens within the 5m chart doesnīt play into the opening or closing of the position. Basically, you need to only look at the chart EVERY 5 MINS, instead of FOR 5 mins.
She1 those are the little tips which makes a big difference in a person placing a trade based on their system, and a person placing a trade which is against their system. Please read the thread and you will be amazed at how accurate that system is, ONLY if you are able to follow the rules and are ok with making 10-30 pips per trade.
  • #218
  • Sep 28, 2015 3:51am Sep 28, 2015 3:51am
well, let's try it this week..
  • #219
  • Sep 28, 2015 4:49am Sep 28, 2015 4:49am
Let's look at this martingale thing slightly differently and with an open mind.
let's assume we're using a negative balance guaranteed market maker broker, maximum risk is 100% of account.

How often do you believe an account running any martingale can make - let's say 150% profit?

If you start with say $1000, and you open an account with 1/10th ($100) - and you start a martingale ea.

-you get margin called on the account - down $100
-fund again with another $100 and martingale - this time it goes better and it's up at least 150% - close positions turn off EA.
-take out $150, leave 100 and start EA again. - you're up 5% on your $1000.
- up 150% (+20%)
- next down 100% (+10%)
- next down 100% (0%)
-next up 150% (+15%)
- you get the idea

- So, it's basically a 1:1.5 risk reward ratio.

But the question is - Do you believe you are going to make at least 150% on an account greater that 50% of the time?
-and if so, how long dose it take on average to make an account grow 150%?
  • #220
  • Sep 28, 2015 5:44am Sep 28, 2015 5:44am
Quoting She1
{image} Any body knows an EA that implement that?
this is a good strategy. the problem is to use it with a reliable (honest) broker. scam broker will disconnect your platform when you need to post big stop order on the other side whenever the price is going to break to that direction and causing loss of dollars in your account.

in theory you will make easy money, but i know plenty of people lost a lot of money due to the problem stated and thats why I would not recommend the strategy for big accounts.

it works just fine in a demo account (no requote/offquote/server disconnection), not in live account.
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