Does the MartinGale strategy work?

[ProfesorPips]

@EmeraldEyes

Buy QQQ or BTC, it’ll yield more than 12% average for sure… once you add DCA to it.

did you just compare trading risk bitcoin to indexes?

[EmeraldEyes]

I asked your question to Roulette players. They said there’s “cold-chasing” strategies and “hot-chasing” strategies.

For dozens (1:2 Risk Reward) the concesus was “Fibonacci Dozens” Fibonacci Dozens Betting System type of martingale for cold chasing, and “Oscar’s Grind” Wiki on Oscar’s Grind for hot-chasing.

[shanmugapradeep]

@Dandelion.My

98% of the traders lose money?

Remaining 2% Traders do not work for 12% a year. Trading is a profession which can be a part time or full time used for Building capital not growing capital.

@Dandelion.My

Secondly, I have a full time job, not able to stare at charts. I also don’t think I enjoy staring at charts.

Your word again proved your in wrong place. You should look for better investment opportunity like ETF, Bonds, Mutual Funds, Index Funds, etc

@Dandelion.My

Thiry SNP 500 are subjected to market condition, and it has to be invested for a longer period of time. Having 12% is just my first goal at least,

There are several ETF and Mutual funds which beat Index funds like S & P 500 easily on short time. Index funds are lowest risk possible investment.

You should rethink, why your here. To build Trading as your Part-time or Second career along with your Job or Your looking for Investment plan to grow your money against the inflation which generated from your Job.

[ontario]

The Martingale strategy, which involves doubling your position size after a loss, is highly risky and generally not advisable in forex trading. While it can theoretically recover losses, it can also lead to significant drawdowns and even account blowouts during prolonged losing streaks. Effective risk management and strategies that do not rely on doubling down are typically more sustainable.

[Dandelion.My]

@EmeraldEyes

For dozens (1:2 Risk Reward) the consensus was “Fibonacci Dozens” Fibonacci Dozens Betting System type of martingale for cold chasing, and “Oscar’s Grind” Wiki on Oscar’s Grind for hot-chasing.

I failed to visit the Fib website that you have provided, thanks for your info anyway.
I’ve used my coding knowledge + the help of chatGPT to build a testing system.
I think this is a dumb strategy anyway.

let accountBalance = 5000;
let betSize = 0.5;
let tradeCount = 0;
let consecutiveLosses = 0;
let winCount = 0;
let lossCount = 0;
let maxConsecutiveLosses = 0;
let totalProfits = 0;

function placeBet() {
  if (tradeCount >= 500) {
    console.log("Reached maximum trade count. Trading system stopped.");
    displaySummary();
    return;
  }

  if (consecutiveLosses === 0) {
    betSize = 0.5;
  } else {
    betSize *= 2;
  }

  if (accountBalance < betSize) {
    console.log("Insufficient account balance. Trading system stopped.");
    displaySummary();
    return;
  }

  const isWin = Math.random() < 0.35; // Win rate set to 35%

  if (isWin) {
    accountBalance += betSize * 2; // Assuming 1 to 2 risk-reward ratio
    consecutiveLosses = 0;
    winCount++;
    console.log("Trade " + tradeCount + ": Win");
  } else {
    accountBalance -= betSize;
    consecutiveLosses++;
    lossCount++;
    if (consecutiveLosses > maxConsecutiveLosses) {
      maxConsecutiveLosses = consecutiveLosses;
    }
    console.log("Trade " + tradeCount + ": Loss");
  }

  totalProfits = accountBalance - 5000;
  tradeCount++;
  updateDisplay();

  if (accountBalance <= 0) {
    console.log("Account balance reached $0. Trading system stopped.");
    displaySummary();
  } else {
    placeBet(); // Continue to the next trade
  }
}

function updateDisplay() {
  console.log("Account Balance: $" + accountBalance);
  console.log("Bet Size: $" + betSize);
  console.log("-----------------------------");
}

function displaySummary() {
  console.log("---- Trading Summary ----");
  console.log("Total Trades: " + tradeCount);
  console.log("Winning Trades: " + winCount);
  console.log("Losing Trades: " + lossCount);
  console.log("Highest Consecutive Losses: " + maxConsecutiveLosses);
  console.log("Total Profits: $" + totalProfits);
  console.log("-------------------------");
}

// Start the trading system
placeBet();

[EmeraldEyes]

Wow, I plugged that in and it’s still trading ++

[S_Jane_M]

@EmeraldEyes

I plugged that in and it’s still trading ++

Lol … how’s it doing, overall?

[EmeraldEyes]

@S_Jane_M

Lol … how’s it doing, overall?

Not bad. About 10% a month so far. I’ll put it up on the MQL5 marketplace once it’s ready. $_$

[PrestonRiver]

this is too much risk. this can save you in a lot of position but it can also blow your account. I would not do that.

[Dandelion.My]

Lol
15 consecutive losses will blow the entire account.
Unless you have a strategy that has a good win rate that will never make you lose 15 times in a row.

[S_Jane_M]

@Dandelion.My

Unless you have a strategy that has a good win rate that will never make you lose 15 times in a row.

The way to avoid consecutive losing runs is to have a smaller R, obviously. On institutional trading floors, something close to 0.7 R is fairly standard (or at least very common) among intraday traders.

[reddawg5345]

Yes it does work but just remember the less amount of pips or the lower the time frames, less forgiveness you have. It’s very hard to bounce back, break even or turn profit with little room to work with.

According to your strategy it sounds like your 10 trades (if they went against you) would all happen within 100 pips. You would be risking more than 1% in that case.

I use a variation of the Martin Gayle system but it’s a swing system which allows price to believe. Biggest take away is you still need market and personal psychology. You need to understand what the overall trend is doing, where traders are, where institutions are, where’s liquidity, trend lines, SR and what the fundamentals are currently. Although price goes up and down, it doesn’t make a straight path to it’s destination. Having more information helps with this strategy.

[S_Jane_M]

@reddawg5345

I use a variation of the Martin Gayle system but it’s a swing system which allows price to believe.

To believe that Martin Gayle himself is also trading it, maybe?

[reddawg5345]

Which allows price to breathe*

[S_Jane_M]

@reddawg5345

Which allows price to breathe

Ah, yes. Got it! Thanks - makes sense, of course.

[MattyMoney]

@S_Jane_M

It’s based on the price-action reality that most “break-outs” are actually fake-outs, i.e. they often reverse and turn in the opposite direction to that of the so-called break-out.

I’ve been looking at different versions of this, but not using volume based bars. Sounds intriguing. Maybe I’ll reach out with some questions at some point.

Sorry to butt in here. Back to Mr. Martin Gail…

[tommor]

Betting the same amount of capital on consecutive trades is not the Martingale strategy. The Martingale strategy is a gambling strategy - using it you double the size of the next position after each losing trade, and you keep doubling it until you get a winner, which pays for all the losers. You hope.

It’s a rubbish system but can sometimes be a pointer towards trend-following, which is something which actually does work.

[S_Jane_M]

@MattyMoney

I’ve been looking at different versions of this, but not using volume based bars. Sounds intriguing. Maybe I’ll reach out with some questions at some point.

You’re welcome, of course.

I gave only a very abbreviated/highlight-summary above, I appreciate (because I wasn’t even sure anyone would actually read it). I do make a living from it.

There are lots of all-slightly-different versions of it. I was taught, and I definitely believe, that all of them work notably more reliably with volume bars than with timed bars (but obviously that’s with futures, not CFDs/spot).

@MattyMoney

Back to Mr. Martin Gail…

I think he married Miss Fianna Fail, and they went off to the Republic of Ireland and lived miserably ever after.