Weighted Coin Toss Trading - MT4/MT5 Resources

Let us plot all your trades onto a chart. Let's plot them into a time frame where you don't trade. Let's take your method from one framework and see if it translates to another.

Yeah?

Or do these look like random locations?

I have been an M1 trader for most of my Forex trading career, but still like to go back and analyze my trades against M5, hourly, H4 charts... to see where and how my trades make sense, or to try to understand where they are going wrong.

I have a clear set of rules that seem to work in my favor and have recently converted them to an M5 chart to account for range and time. Looking back at these trades that make sense on the M5, may not make sense on the M1...in fact, in many cases they completely defy the same logic.

Depending on how you look at things, this basically makes my trades random.

Now, I'm a sucker for cost averaging. Adding my losers is usually based on the biases my chart tells me. I won't win every trade, but at the same time, I know when to cut my losses, and this doesn't happen through arbitrary stop loss values.

The market and my trading pairs operate within what I consider to be a dynamic range, which means setting an arbitrary value of -20 or -50 may correlate to one of them, but certainly will not translate to the other... In my opinion, it would be foolish to allow a trade to go in the wrong direction of my technical bias, when I could just jump in the direction that favors the actual trend...cut my losses and make some profit.

Now, these are not always successful either. I might get into a position that goes bad, then exit and flip, only to lose a second time, which sometimes makes me lose 4-5 times in a row. I’m not a big fan these days…

anyway...

In dollar cost averaging you have to decide how much to add to the trade, and I kind of like martingale additions because my follow-on positions are larger than my main positions. Regardless, incrementally increase or use a 1.5-2x multiplier and get them to the desired net positive position.

So...this weekend, with the help of some statistics from last week's trading data, I made a simple modification to the Martingale strategy that seems to be taking hold on weighted coins.

By applying to Renko charts, what I effectively do is double down on overbought and oversold positions using indicator bases and pure martingale, and apply it to multiple currency pairs in the market.

Weighted coins... If you were playing roulette and started with a black hand and then doubled down until you won, how many levels could you play? If you wait until you see 4 reds in a row, doesn't that actually increase the probability of success?

The same goes for betting on weighted coins. If you start betting heads or tails consistently and wait until 4 heads come up in a row, is it reasonable to start betting tails and double down from there?

I won't do the math on this, but will put down Trade Explorer and watch the results.

The rules are like this...

If Stochs is overbought and CCI is greater than 100 and is now less than 100, sell.
If Stochs is oversold and CCI is below -100 and is now above -100, buy.

Stop loss, 20.
Taking profits, 20.
The Martingale factor is 2.0.

I'm working off of RR's old thread, see post 1, here.

Now, looking back at your history with martingale and seeing how much risk is involved with this general principle, of course I wouldn't put real money on it... (well, not initially), but over time, is there an actual set of trades where this idea can thrive on a weighted coin toss basis?