Scaling up and scaling down positions

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"Scaling up" positions means inc Whatisf cashback forexexrebateeasing the number of positions as prices move in a favorable direction bestforexrebate your confidence in the profitability of the trade increases "Scaling down" positions means reducing the number of positions as price momentum decreases As a sensible strategy If you are going to trade 5 lots and the trend forexrebatenetwork in your favor, you will make more profit by executing those 5 lots at the beginning. But the advantage of a scale-up position is that you dont have all your eggs in one basket. In the case of a sudden stop and a sudden end, if you use a scale-up strategy, you only have to let one or two positions go, so losses are limited. "Some traders say they will never use any strategy that reduces their total profit, but this statement has a hint of desperation and does not give a full picture of the forest. Similarly, position reduction is a technique used to reduce risk by taking profits on one or two contracts at the beginning of a move, you can improve your P/L ratio on the remaining contracts which are almost "free", especially if you use a trailing stop to take profits on the first few contracts. By the time you close, the stop loss level is already relatively low and scaling the position with a trailing stop can be a good way to reduce risk, in addition to using another risk reduction strategy - that is, using other indicators as trading conditions to confirm your initial analysis and position. You can enter or exit one or two contracts based on indicator # What is forex rebate, add or subtract one or two contracts based on indicator #2, and complete your entry/exit with a reduced position when other indicators give consistent signals. Oscillators, RSI and momentum are all lower. These are all logical indicators for position reduction, but soon after you exit a contract or two, the price rises again, then falls back slightly, then goes up again. -that is, the currency is generally overbought-but in a very strong move, it can be overbought for a long time. So, if you are not a trend follower, this is exactly why the Stochastic Oscillator is not the best for position reduction. You know your target - the previous high (1.6843) plus 20 basis points, i.e. 1.6963 You also know your stop-loss level --the previous low (1.6771) minus 10 basis points, i.e. 1.6761 The current price is 1.6800 An example of an appropriate application of the position scaling strategy You buy 1 lot at the current price of 1.6800 with a stop loss of 1.6761 and this stop loss is below the support level that should be set Your profit target is After 63 pips and a stop loss of 39 pips, the price rises to 1.6820 You add 1 lot and set your stop 20 pips higher than the first stop, i.e. 1.6781 After that, the price rises to 1.6840 This is very close to the previous high, but then it does cross that level, giving you a little breather Your hypothetical scenario is about to play out Traders remember that when prices cross the previous high, they do so with a herd effect. You added a third lot at 1.6845 and raised all three stops by 20 basis points, i.e. 1.6801. Now, your price reaches 1.6862 and your profit and loss statement shows a profit of 124 basis points: [email protected]@1.6863 profit: [email protected]@ 1.6863 profit: [email protected]@1.6863 profit: 18 Why not buy three lots at once at the starting point of 1.6800 and make a profit of 189 pips? The answer is twofold: as mentioned above: we can guess what the future may hold according to what we have seen before, but the expected price reversal may also lay off allocating the funds separately allows us to avoid the risk of subjective pipe dreams we use the market itself to validate the signals to guarantee profits on the other lots

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