Mechanical_Trading by SupremeLord

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									                            Mechanical Trading
It seems the most prevalent way of thinking about trading and investing
    is trying to find some way of predicting what will happen next,
    whether by analyzing fundamentals, technical charts, or some
    combination of both.

We do not consider our trading approach to be in the category of
  “predictive” trading. We call our approach “reactive-corrective”. It is
  an approach marked by simple, logical tactics. We believe our
  method of doing this is revolutionary and will create a stir in the
  world of trading in coming years.


Red Shoe Consulting LLC © 2007 | All Rights Reserved
The key to a successful reactive-corrective
 strategy is to overcome any individual
 losing trades by closing winning trades to
 cover the losing trades, plus a little extra.
 Then, we close the losing trades.

For example, if you generate $1,200 worth
 of winners while a $1,000 loser is
 open, then close the loser, you have made
 $200.
Red Shoe Consulting LLC © 2007 | All Rights Reserved
Our philosophy says:

Stop spending so much effort trying to
  predict market action. It’s a waste of time
  and energy.

Stop trying to avoid losing trades. This too
  is a waste of time and energy.

Red Shoe Consulting LLC © 2007 | All Rights Reserved
Embrace your losing trades! Losing trades will happen, it’s
  useless to try to avoid them. It’s better to have tactics
  that deal effectively with them when they occur.

A great trading strategy has the power to overcome each
  and every losing trade.

We need to trade in such a way that every time a losing
 trade is closed, we will have made money.

Yes, this IS possible!
Red Shoe Consulting LLC © 2007 | All Rights Reserved
Many traditionally schooled traders haven’t been
 taught to think in the reactive-corrective way.
 They’ve been taught to continually look for ways
 to predict what the market will do next. They’ve
 been taught to keep tight stops and let their
 winners run. Some traders can make this
 approach work, but it is very difficult to be
 consistently profitable this way.
Red Shoe Consulting LLC © 2007 | All Rights Reserved
In the realm of computerized trading , a great deal of effort has been
    spent trying to use brute computing force to better predict what the
    market will do next, based on emerging patterns. “Artificial
    intelligence” and “genetic algorithms” sound glamorous, and they
    may be part of successful predictive approaches.


While these approaches may work, the approach of trading reactively,
  leaving losers behind, and closing the losers when enough winning
  trades have been closed, requires very little computing horsepower,
  and is easy to understand.




Red Shoe Consulting LLC © 2007 | All Rights Reserved
In sustained directional movement, we
  trade in the obvious direction, either
  long or short.

Both long and short trades can be open
 at the same time.

Red Shoe Consulting LLC © 2007 | All Rights Reserved
Controlling lot sizes proportional to the account size and
  limiting the maximum number of open trades is how we
  manage risk.

We open trades and book profits with high-frequency
 trading. The speed with which we can add to the
 balance is due to simple yet highly refined mechanical
 trading techniques.

 This allows us to overcome losing trades, and at times
  close mostly winning trades as the market moves
  strongly in one direction.
Red Shoe Consulting LLC © 2007 | All Rights Reserved
Being able to open both long and short
 trades whenever we want means we can
 generate a stream of winning trades,
 regardless of future market action.

The trick is to have a strategy that adds to
 the balance faster than our equity and
 margin can drop.
Red Shoe Consulting LLC © 2007 | All Rights Reserved
We have packaged our strategies and tactics in not just
 one battle-tested Expert Advisor, but several.


And we make the Expert Advisors available in both MT3
  and MT4!




Red Shoe Consulting LLC © 2007 | All Rights Reserved

								
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