Most traders will say that that is trading suicide but let's take some to look at this more closely. The hedged grid trading system uses the principle that one should be able to cash in at a gain no matter which way the market moves. No stops are therefore required at all. this is logically possible is that one would have a buy and sell active at the same time.
If you wanted to use this system you must be thorough when during tren will end and tren just began to be formed. For example, Let's say that a trader enters the market with a buy and sell active when a currency is at a level of say 100. The price then moves to 200. The buy will take profit 100 and the sell will be decreased - 100.
Let's say enter again into a buy and a sell transaction. Now, for convenience, let's assume that the price moves back to level 100. The second sell has now gone positive by 100 and the second buy is carrying a loss of -100.
According to the rules one would cash the sell in and another 100 will be added to your account. That brings the total cashed in at this point to 200. Now the first sell that remained active has moved from level 200 where it was -100 to level 100.
Hoped for by the trade that was loss will come back was fortunate because that was needed by care if using this system. Happy trading.
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Forex Profit by using hedged system? Why not..?
Label:
Forex Strategy