I’m trying to work out the best way to get the most out of a swing trading strategy.
I’m looking to ride longer-term trends, maybe days leading to weeks if possible – but what would be the best money management for that kind of strategy?
At the minute, I’m placing trades of 1.5% my balance, taking profits at r/r of 1/1 & then letting the last 0.5% ride the trend as far as I can.
But it feels a bit strange to be taking money off the table if I’m looking to catch a trend, it feels like I should be scaling in, rather than scaling out.
But then again by locking in some profits with a first TP target, I’m left with a free bet so to speak.
First study some currencies to find which have the ability to provide trades which “ride longer-term trends”.
Do the majority of FX pairs really “trend” that nicely, for that time length?
Realize that most retail traders have the tendency to get in too late, and out too early.
You won’t know the start of a “trend” until its runs 600 points, with 4 higher highs and 4 higher lows, and, is ready to reverse.
FOREXunlimited - Thanks. It seems like a couple at least of the USD’s have been in a clear trend for at least 4-6 weeks including NZDUSD & then there’s CADJPY. (Although part of me is wary that I’ve really started trading in the biggest USDollar run for years, so my expectations might be a bit skewed.)
I know there will probably be a lot of false starts doing it this way, so that’s why I was considering taking partial profits early, but my thinking was these more numerous smaller losses could be overtaken by 1 or 2 scaled into positions.
etfak - I think I do have the psychology to do that, yes. (Well, we’ll see - I’m only on demo trying to to work it out) but I think I’ve got a pretty good attitude to Risk/Reward, and can do something counter-intuitive almost if I can see it’s making sense longer term. I’m prepared to add to winning positions if that’s what it takes.
(& moving my SL is something else I’m trying to work on!)
You can never get the profits at some perfect level, but you can try to develop your own way of taking the profits. For example by adjusting your stop loss once your trade get profitable.
. Any tips?