Hi 4x4
Interesting strategy.
This may have already been covered and I have read this thread from the start but may I ask the following:
Do you place both trades (short and long) at the same time. ie, within minutes of each other?
Do you place both trades (short and long) on the same instrument?
Also, which trade do you cut out first, the one in profit or the one in loss or does this change?
Cheers,
Lee
No, their usually hours apart, and I only do it if trends are mixed. I trade trends and support and resistance - which in my book both vary from time frame to time frame. In my current trade - I'm long off daily support (up trend) and short off 1H resistance (down trend).
Yes, the spot price.
Usually, both trades are positive, it's rare I am long and short a (nett) negative position, but it can happen, and if I am it is often only for a few minutes as my stops are fairly tight, typically 13 - 25 points.
If I can close half at equal to or better than my risk, I do so. This gives me a free, no risk trade without having to move my stop loss closer - I usually sacrifice one or the other trade, sometimes for loss, sometimes for a small profit or at break even.
I watch 8 markets, if I see a correlated move across the board, I will keep adding positions - this is rare these days, but it does still occasionally happen.
Mostly, the strategy is about gaining the right entry in the market and holding a position - not about trying to grab 20 pips or so.