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EURUSD Scapling

  #27 (permalink)

Trading Experience: Intermediate
Platform: FlatTrader
Broker/Data: GFT and Interactive Brokers
Favorite Futures: ES, DAX
Posts: 532 since Aug 2010
Thanks: 2,141 given, 726 received

Arich View Post
I read a comment that a trader posted recently on a forex site. He said something that interested me, which is why I started this thread.

He claimed that too many traders emphasize "aggressively capturing pips" (i.e. aiming for 50,75,100, 200, etc. pips) when, in his opinion, they should rather scale back on how many pips they target and aggressively use more capital. He said that he aims for one 5-10-pip move a day and uses ten lots, effectively making $500-$1,000/day.

Now, obviously this begs several questions about indicators, methods, strategies, etc. that he uses to achieve these profits. Also obvious is that he can't just make one trade a day (which he didn't elude to or say that he did), but rather sets his goal for the 10 pips. He also said that he doesn't use stops, which surprised me.

I tried to look up his post but couldn't find it again.

I know there are hundred if not thousands of different mediocre strategies out there trying to be passed off as the holy grail of all tradingdom, so I wouldn't be surprised if this guy was just gloating about another mediocre method. He wasn't selling anything, and he didn't seem to be prodding anyone to ask him for information. He did just seem to be presenting an opinion, so I would like to know your thoughts on this.

Is his basic theory concrete? Market exposure does not seem too appealing, and targeting high amounts of pips opens a trader to more market exposure.

Is this just another opinion that is good or bad based on preference? Are there legitimate rewards to aggressively using capital like that without stops as long as the target is small? (Seems really risky to me)

What are your thoughts on this?

Ok, my thoughts on this.

IMO itīs a very lucrative and valid trading style. BUT, this is only doable if you know exactly what you are doing and are very good at it (discipline). This means no hopium or hesitation by following your trading plan.

However I have a different opinion regarding stops. of course you canīt work with tight stops but must have at least a whorst case stop for such as broken connection, pc trouble, unecpected major events etc.

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