Martingale Trading SYSTEM for Algo Trades [THIS INSANE TRADING STRATEGY WORKS ALMOST EVERY TIME!]

[@HateDietPepsi]

My position size is a standard 2X in which I remove half the position after the stop loss money is reached and then move the stop to breakeven. For example, long 100 shares of COST, with a $500 stop loss. Once COST is up 10 points ($1000), I'll sell 50 shares, making $500 profit, and move stoploss to breakeven and will continue to move the stop up like a ratchet system. However, this is all optimized and forward tested to pick the best stop and ratchet number.

[@AlgoTradingWithKevinDavey]

If it works for you in real time, thta is the ultimate judge!

[@covingtoncreek]

I definitely lean towards increasing diversification as my trading capital increases. Only one time after live trading a Canadian Dollar strategy that was doing great for a year, I decided to double the amount of contracts I was trading with that one strategy, while leaving all other strategy positions the same. The CD strat seemed like it just couldn't lose. That is the point the strategy stopped working. So I lost double the money. Stopping that strategy felt like a bad break-up. LOL.

[@AlgoTradingWithKevinDavey]

Isn't it crazy how that happens? Like the market was waiting for you to double, and then have the strategy break...

[@qtrader677]

in a system where you win more often with smaller gains and greater loses some people choose to use a positive progression because the wins will group together in longer strings.

[@AlgoTradingWithKevinDavey]

Yes, but when the inevitable loss comes, it will be at a large size...

[@NoamPeled]

I'm sorry, but averaging down is not Martingale. In a Martingale system every bet is separate and is closed before you take another bet.

[@AlgoTradingWithKevinDavey]

I did not average down (each trade was separate), so I do not know what you are referring to. Thanks for the comment though! Please reply with a timestamp of what confuses you, and I will explain.

[@NoamPeled]

@@AlgoTradingWithKevinDavey Sorry about that. It was a little unclear from the AudJpy description with the "buying this uptrend and just kept buying and taking little bites". This isn't really a strategy to base a Martingale over even if you do take it bet by bet, as the market doesn't care about your pocket. A trading bet should be a clear technical trigger with a technical-based stop in order for a Martingale to be considered.

[@AlgoTradingWithKevinDavey]

@@NoamPeled - From what I gather, these traders were in buy mode because of trend, had small profit target and then reentered on a likely technical short term long signal. I'm not convinced there is ever a strategy where Martingale is a good way to go.

[@hb7of9]

@@NoamPeled erm, not sure what you're on about. What he showed is the EXACT textbook definition of Martingale as least as the French mathematician Paul Pierre Levy, the inventor envisioned/invented it in the 1800s.

[@NoamPeled]

@@AlgoTradingWithKevinDavey Well, my point was that you're extrapolating a general claim about a whole class of strategies based upon a single specific example of a specific trigger that isn't even based on technical analysis.