Reverse Martingale (Testing purpose)

Hello All,

just now i think of a strategy that everyone can follow this is still testing purpose only. heres how :

its called Reverse Martingale, it works on any fx pairs, any stocks, or any market.


Step1.)

BUY and SELL AT THE SAME PRICE, both orders is 1 lot on demo. set Takeprofit and Stoploss equally 100 pips for both orders.


Results : so assume, the chance of market going which way is always 50/50 & only 1 of the orders will profit and 1 will loss, right?

in this example, we assume.. buy orders has hit its takeprofit at 1.500, while sell order hit its stoploss on its 1.500 as well..

Step2.)

the next step is we will focus on the profit trade, which is previous buy order and this time we enter buy orders again & lot size 2 lot. then another sell orders of 1 lot only(since previous sell order it was loss)

both orders entry price at this step two is 1.500 & both orders has equally set TP & SL 100 pips.


Step3.)

same thing again, only one will win and loss, if this time buy order 2 lot wins again, next is we bet 4 lots on buy order, and same only sell order 1 lot. Both orders has again the same amount of TP and SL of 100 pips.

that means this is reverse martingale and only double up for the winning trade. sequence for this is up to 1 - 4 lot size just to be safe, and then repeat the betting process again to 1 lot size. What do you guys think? please give comment or help me improve this method if you can..


Cheers

I see the logic, if the market goes up keep buying, but why bother with the sell order you're just needlessly paying extra spreads.

What is the difference in beng long 1 lot

or long 2 lots and short 1?

foredog said:

I see the logic, if the market goes up keep buying, but why bother with the sell order you're just needlessly paying extra spreads.

What is the difference in beng long 1 lot

or long 2 lots and short 1?

Click to expand...

umm.. i was.. if the long 2 lots loss, and you at least got sell 1 lot win. please contribute if you are able to modify the technique or make it better. thx

foredog said:

I see the logic, if the market goes up keep buying, but why bother with the sell order you're just needlessly paying extra spreads.

What is the difference in beng long 1 lot

or long 2 lots and short 1?

Click to expand...

Foredog - fair question and I don't believe there is a difference. Everyonerich - any system which is based on a 50/50 chance will not in the long run make a profit or a loss no matter what money managment system you use. A bit like the roulette wheel however the house margin (spread) will always ensure a loss.

So the question to you is does your system in fact give you a better than 50/50 chance by following short term trend?

everyonerich said:

Hello All,

just now i think of a strategy that everyone can follow this is still testing purpose only. heres how :

its called Reverse Martingale, it works on any fx pairs, any stocks, or any market.


Step1.)

BUY and SELL AT THE SAME PRICE, both orders is 1 lot on demo. set Takeprofit and Stoploss equally 100 pips for both orders.


Results : so assume, the chance of market going which way is always 50/50 & only 1 of the orders will profit and 1 will loss, right?

in this example, we assume.. buy orders has hit its takeprofit at 1.500, while sell order hit its stoploss on its 1.500 as well..

Step2.)

the next step is we will focus on the profit trade, which is previous buy order and this time we enter buy orders again & lot size 2 lot. then another sell orders of 1 lot only(since previous sell order it was loss)

both orders entry price at this step two is 1.500 & both orders has equally set TP & SL 100 pips.


Step3.)

same thing again, only one will win and loss, if this time buy order 2 lot wins again, next is we bet 4 lots on buy order, and same only sell order 1 lot. Both orders has again the same amount of TP and SL of 100 pips.

that means this is reverse martingale and only double up for the winning trade. sequence for this is up to 1 - 4 lot size just to be safe, and then repeat the betting process again to 1 lot size. What do you guys think? please give comment or help me improve this method if you can..


Cheers

Click to expand...

I think you're an idiot

arabianights said:

I think you're an idiot

Click to expand...

in future, every idiot able to make money from market. are you scared?

everyonerich said:

umm.. i was.. if the long 2 lots loss, and you at least got sell 1 lot win. please contribute if you are able to modify the technique or make it better. thx

Click to expand...

OK so with your system you buy

2 lots at 1.5003 stop loss 1.49003

and sell 1 lot stop 150.00 sl 1.5100

it goes down to 1.4903-006
you buy one lot back at 1.4906 profit 94

you sell 2 at 1.4903 loss 200

net loss 106

OR buy 1 lot at 1.5003 sl 149.003

hits 1.4903-06

net loss 100

which is 6 different (funnily enough 2 lots of the spread...wow)


Now tell me what is the difference in being long2 short 1

and long 1?

And it's not a trick question...

foredog said:

OK so with your system you buy

2 lots at 1.5003 stop loss 1.49003

and sell 1 lot stop 150.00 sl 1.5100

it goes down to 1.4903-006
you buy one lot back at 1.4906 profit 94

you sell 2 at 1.4903 loss 200

net loss 106

OR buy 1 lot at 1.5003 sl 149.003

hits 1.4903-06

net loss 100

which is 6 different (funnily enough 2 lots of the spread...wow)


Now tell me what is the difference in being long2 short 1

and long 1?

And it's not a trick question...

Click to expand...

oh yes.. same as long 1 lot.

back to the topic, then.. if grid trading.. would be like that.

everyonerich said:

in future, every idiot able to make money from market. are you scared?

Click to expand...

not really, you've been adequately warned and so has anyone who gives you money and I'm a bit of an economic darwinist, so...

Excuse my niavety but what is Grid trading?

What's wrong with just buying stuff when it goes up and adding more if it keeps going up?

The other problem i forsee with your idea of (Effectively) if it goes up once buying 2, if it goes up more buying three is that the first up move will possibly be the biggest so would probably be the best to trade size on where as the subsequent moves may not be as strong so would deliver a lower R:R at a time when you are staking more money.

foredog said:

Excuse my niavety but what is Grid trading?

What's wrong with just buying stuff when it goes up and adding more if it keeps going up?

The other problem i forsee with your idea of (Effectively) if it goes up once buying 2, if it goes up more buying three is that the first up move will possibly be the biggest so would probably be the best to trade size on where as the subsequent moves may not be as strong so would deliver a lower R:R at a time when you are staking more money.

Click to expand...

oh.. grid trading means like.. just set buy stop and sell stop all the way then let the market breakout.

im having stomach ache.. cant think so much now!!

devise a system/strategy which:

identifies when demand is increasing and the price is starting to rise and you should get in low, since there is a lack of availability for the instrument,

identifies when suppply is increasing and you should get out or short high, when there is no demand present for the instrument for prices to go any higher and supply is overwhealming.

indentify the price and volume patterns for this, test the patterns and hypothesize

why would you buy? and when would you want to buy? vice versa for sells/shorts.

stop wasting your time with anything else, your are trading, think like a trader.

if pirce is going up but volume(activity) is decreasing, what does that tell you?

if price is reluctant to go any lower after high volume, price makes a higher low and volume is even higher than before, what does that tell you?

the answers are on the chart already.

Hi there,

Im Alex... And I have the following idea...

The smaller the profit the less risky the "game" so the more people will play the game.

Let's take EUR/USD, say you want to buy... Without looking that much at the graph or reading the news ... Just you want to buy....

Step 1 : BUY (10eur worth) = 1000 (1:100)

Step 2 : set stoploss/takeprofit at 1 eur each , 50/50 chance of winning or losing 1 eu

Step 3 : if you got it right you have to options :

3a : take the profit
3b : follow the price... Some software has a trailing option and the distance at whitch to follow, or you can manualy set it if u dont have... Ex: u have the profit... To price still going up, you set a take profit further up, in case it reverses itwill automaticaly stop.

Step 4 : you got it wrong, the price falls... You lost 1 eur ... You dont wait to rise back ... You go with the flow.... And sell ... First all you have allready bought 1000 , than sell 2x the last amount .... In this case ... 2x 1000 = 2000 (sell) ... And now you put the stop limit and take profit at 2 eur...

The ideea of it is that you get 2 eur... Minus the 1 eur you lost... = 1 eur profit... If again you lose ... Double again... Eventualy you will get it right and get that 1 eur...

For this game you can do the folowing with 100 EUR :

10 initial buy ... Lose 1 eur ...remaining 99

Sell 20 .......lose 2 eur ........remaning 97

Buy 40........lose 4 eur ......... Remaing 93

Sell 80 .......lose 8 eur ......... Remaing 85


The fact that you double the amount is the key of waiting a short movement on the market... With 100 eur you get 4 chances ...and the risk is 15 eur... With the remaing 85 you can start from the top... OR you can put 1000 eur in the game and get 7 chances... AND more if you put your money on a pair that you have some info about... It turns into a easy profit...


I have run a simulation with this on the EUR/USD on the last 10 year chart, and the result was ...WOW... with 100 eur the profit was 2.6 milions ... Yeah ... 1 eur at a time...


Try it out and drop an idea at [email protected]