Sounds to easy.

Discussion in 'Forex' started by drasfs, Jul 16, 2006.

  1. drasfs


    I was just reading about a trading strategy that sounds good on paper, but as usual im very sceptic to wheter you can employ it.

    This is how it works:

    SL: 10 pip
    Limit: 20 pips

    Therefore the win ratio is going to be 2:1

    You set the entry order one min before a fundamental announcement, since the currency pair will always jump up at least 40 pips in general when these fundamental announcements do occur.

    So, sometimes you will lose and sometimes you will win, and in in theory the chance to win is 50%, but you will profit since your win ratio is 2:1

    This sounds a bit to easy. Im sure, your broker wont accept any entry order near fundamental announcements,as the market tends to gap. However, this would work on smaller fundamental announcements.

    I need some opinions on this and I want to know why you cant employ this strategy successfully.
  2. Why not 3:1..have two marketmakers and wait for the reverse side of it...with mm#2

    place your order one hour before...

    If you good you can get the retrace too...

    I do not traded this way
  3. drasfs


    Electricsavant: I know you are just sarcastic. I know it doesnt work either, but I would appreciate a good explanation why it doesnt, since it sounds logically correct in theory.
  4. I was serious. I do not like to trade like this however. It's not my syle. It really moves fast sometimes and I do not feel control.

  5. drasfs


    No, this strategy is just too simple to work. Why arnt everyone employing it then? Especially since you are guaranteed to profit from it.
  6. I suppose you could track the rate of change during any period and come up with entries...
  7. drasfs


  8. play with them...try to find a dual overlay...look at 3 and 14.

    excuse me while I go pull some hairs out of my chin...

  9. Lucrum


  10. drasfs


    TL trader: There are no sufficient explanations at all in any of the threads that you gave me.

    They mainly discuss about random entry. But they foroget about that the limit order should be bigger than the stop order. And there is not much emphasis on volatile markets,where this trading strategy can be employed sucessfully.
    #10     Jul 16, 2006