so, I quote from the work of V. Barishpolts, which just outlines the features of the second approach to building a trading system. Let me remind you, the second approach is different from the first one, which does not imply losses in trading. That is, the first approach opens a simplified position, a stop is placed, take and all- the rest depends on the market.
Cold, it will become clearer later, what are we talking about?.
V. Barishpolts, «Forex for beginners»:
I did not name this section for nothing «new old tactics». Really, the solution lies on the surface, and all, работающие, or trying to work, traders, tried this approach. The essence of the second approach is to immediately close a position at the first signs of deterioration., with increasing losses. It's that simple, but ... After opening a position, we immediately have a loss, spread. What, сразу закрывать? Silly. Means, рассуждает trader, you have to wait a little, that is, move the stop further. Where? How far? And smoothly move on to the first approach, with big stops, long waitings, etc.. After all, large stops imply the obligatory taking of large profits., otherwise mat. expectation of tactics will be negative. And the probability of taking a profit falls quite sharply, when it increases. (All in all – then, I am largely abstracting now, counting, what's inside the day, we trade in noise).
Small stop is instantly triggered. Furthermore, if you place such a stop not on a piece of paper, and expose to the broker, I think, many Brokers будут намеренно «тикать» at your foot. And they will be in their own right – Do not forget, You trade with your broker, and not some kind of impersonal market. In this way, Again you will inevitably lose your money.
Big stop, Besides, which sometimes works, periodically making the deposit much easier and forcing us to start all over again, throws us out of the market for a long time. Who does not know the painful state of the unknown, when, opening up, for example, Monday, all week you watch with bated breath, how the market moves against your position, and only on Friday it is possible (and sometimes it doesn't work!) close with a measly few pips profit and a feeling of happiness, what «popped out» without loss. By the way, right after that, quite often, the course leaves points on 100 towards your, already closed position. About market, he has a kind of humor! A week has gone to waste, and how many nerves and health were spent ...
I've had such «freezes» almost a month, and more. Heavy sensation. And more than once I asked myself in such a state – why not close on time, don't turn around and play the other way, increasing the deposit? And really, why? That's why, what is so dictated by the first approach – wait for the planned profit (or triggering a stop). Wait, and point!
It would seem that – тупик. However, I am sure, that the inquisitive minds of many of my colleagues have found a way out of this impasse, and successfully use the second approach in their work. One of the options, it seems to me, I found it too, and I offer it to you for consideration and thought.
First, I will put forward the lemma (who remembers – this assumption, self-evident). There she is: any open position what – that time is profitable. I spent two weeks checking it – opened on a demo account for different currencies in various directions. So here, during the first 10 minutes 99% positions were profitable. More than half of them, после этого, left for a long time in a big minus, a small amount of – gave a good profit, and – quickly, остальные -»rocked» at the open level all day and closed at the end of the working day.
When I say profitable, this means, that they were profitable 1 and more pips (and then for many before 50 pips – no profit at all).
From here came the first rule: after that, how the position became profitable, it must be closed in case of unfavorable development of events, least, with zero profit (без убытка). The level of profit achieved in this case will be called the first level.
However, to enrich the broker with spreads, nothing is «отщипывая» at your own expense, how – that's wrong. Therefore, we apply the second rule: upon reaching the planned second level of profit, we must exit in case of unfavorable development of events with the first profit level.
«Pinch off» on 1 – 5 pips of profit are often effective, but tiring and dangerous. We need a rule, allowing you to take sometimes a solid profit. Let's formulate it: Upon reaching the third level of profit, we limit losses at the second level and «letting profits grow», pressing profit trailing stop, or until there are clear signs of a reversal.
Looks good, Really? But, Unfortunately, immediately after opening, each position is in a loss area, And, sometimes, pretty long. What to do at this time? How to prevent losses from escalating into unacceptably large? How to wait, until the position turns into profitable?
And there is nowhere to get away from closing on any – then, previously calculated, уровнях, usually – big enough. Here, – the reader will say, – а говорил – безубыточная торговля, without planned losses ... What a break-even – did not tell, that no losses are planned – that's right. Here's the main difference between the first and second approaches.
so, when we close the position (except for the above cases of closing with a profit)?
The position is closed immediately, when the signal, по которому открывалась позиция, отменился, or changed to the opposite.
The position is closed immediately upon reaching the levels, overcoming which is a signal of a movement reversal. In this case, a position reversal is possible..
The position is closed when the time has elapsed, planned to maintain this position.
Чувствуете разницу? We do not give a position in any way «to depend». We do not plan, say, 57 stop loss points, just close the position, when holding her no longer makes sense. Didn't guess – закрываемся, waiting for the moment for a new entrance. So – time after time, day after day.
I will clarify. And what, if the price is one tick «flew away» on 100 points at a loss? We decided to close – then close. Otherwise, by the next tick, it will fly away for another 300 points. You have not seen such movements? Поверьте мне, they have been and will be. (Just enough not «run up» on such movements, we'll talk about it later).
And three very important points:
Closing a position is not done at a specific price, but by making a decision. I.e, if you have decided to close, and sent a request to the broker, don't look, what he sent, close the position. Fluctuation, expectations, etc., usually, lead to a significant deterioration in the situation.
Tactics require a professional approach to trading, that is, hard work for hours, inseparably. It was at that moment, when you leave for a smoke, or take out the trash, everything will happen. Even if the house is on fire – close the position first, only then take out the furniture. You must understand this, your loved ones should understand it, and not distract you from work.
In the second approach, forecasting the time and direction of market entry becomes very important..
If you do not have the opportunity to spend several hours in a row without interruption at the monitor, devoting time only to trading – better and don't try the second approach. Work tactics, using the first approach, for example SC, or do position trading, work on a day schedule. Very simple – draw a channel on the day chart and open from border to border with stops of points at 150 – 200. But not more, than on 1/10 deposit. Channel is not drawn – don't trade at all. Against the trend – better abstain. Just be sure to wait for the price to touch the channel, no matter how incredible this level may seem, it will happen anyway. You will have everything 1 – 2 transactions per month, but the very coveted 200 – 300 points of profit per month they will give.
Here, actually, and all the principles, including the second approach to building trading tactics. As you can see – nothing «revolutionary», or clever. Heavy, hard work, many market entrances, most often ending in zero or small profit, units of points. Nevertheless, these grains often add up to a very impressive profit..
I can add on my own, what trailing stop will be used. That is, roughly the picture is as follows: We receive a signal to open a position and enter the market. If the position goes into a profitable zone – start squeezing its trailing stop, take profit may not be used. The position will be closed when the price touches the trailing stop or when it is closed manually, if the profit turns out to be very good. If the position goes negative and our signal is canceled, just cover the pose and wait for the next signal.
