Looking for your input:
Can someone give me a good reason why I shouldn't, when I find a high probability move, enter with 1-2% and then add .5-1% on every pullback on the 1-5min chart? Spread betting forex.
I always use stops and after each pullback, I would move the previous stops up to the next pullback level.
In the few times I tried it, I was risking more than I was making, but I was aware of this. I wouldn't use that strategy on just any trade. Only the highest probabilities I encounter.
Obviously having more risked than I intend to gain is going against one of my 2nd tier rules, but should something being outside of my core principles mean I shouldn't play with it, manipulate it, see if I can make something good of it?
I understand that slippage is something that will come to a few minds, but my broker doesn't show gaps for some reason, and takes the opposite side of my trades...so would that mean my stops will always take me out at the predetermined level? Disregard widening spreads for a moment.
leaving "high probability" and risk/reward aside for a minute, its fine in theory to pyramid in this way. I think it depends on the person. Most people can do the maths of why it would work but not everyone can be "arsed" to do it. Sorry to be simplistic but just do it if you want to - assuming you know your overall risk level
hope youre enjoying your friday night