COMPOUND GAINS VARIATION 2
Here is a clever strategy that is a modification of the above. It is
riskier than variation 1 in the sense that you stand a great chance of
getting stopped out early thus missing more gains, but if everything
goes well then you stand to make greater profits, as from our visual
diagram example used above, with this variation you would have 5
profitable trades as opposed to the 3 trades from the above example.
For this variation you simply use “Basic Strategy Variation 4”.
So how does this one work? Let’s use the same diagram as above
for our example.
You would get in on point B as usual, with your stop set for A.
(trade 1)forex sato
When you get to point E you place your entry order for D, and your
stop set for C. (trade 2 - Just like I told you not to do in variation 1)
Now you watch your charts like a hawk. As soon as the prices cross
D and your trade is activated then IMMEDIATELY replace your
stops of both your trades to E (act fast).
What happens now if the market turns around? Well trade 1 is
profitable, trade 2 is a loss, and you should either have a tiny net
gain, a break even, or just a tiny loss (of less than 10 pips).
FOREX Surfing Draft.forex sato
Now that markets continue upwards and you see another wave (you
are at point G). Place another entry order at F with stop at E (trade
3). Again, watch like a hawk and as soon as your trade is activated
then IMMEDIATELY replace your stops of all three trades to G.
Repeat this procedure to enter on points H and J. Now you would
have a total of 5 open trades, and all your stops would be at K.
At this point should you get stopped out you would have fantastic
profits on trades 1, 2 and 3, trade 4 would have a marginal gain, and
trade 5 would be a loss. Your net result would be that you would
have gained more pips than the height of the entire price movement
(from point B to J). You have successfully compounded your gains!
forex sato

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