Setup:
I will begin by resetting my Forex account to $5,000.00 USD @ 20:1 leverage. This will give me a nice 100K margin with which to work. This weeks profit-loss ratio (PLR) will be 0.5:1, with a take profit (TP) of 15 pips and a stop loss (SL) of 30. Each issue will trade for about 15% of the total account, or $15,000.00 USD.
Expectations:
I believe this short ratio will be less than optimal for my purposes. I should trigger more TPs with it than at the higher ratios, but I will need a lot of profits to make up for the losses. The average week at this rate looks like something around... -55 pips. Overall, I expect a good number of trades to end too quickly.
Rule Override:
To compensate for the shorter ratios, I will make the following adjustment to tighten rule 2 a bit:
2a. If a pair's trade history (see rule 1 in the first post) contains two losses, I will cease trading it for that day.
Monday, March 12, 2007
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