The technical solutions for position doubling that novices have practiced:
1. Capital Management: The Foundation of Position Doubling
Divide the total capital into 20 equal parts, strictly control the risk of a single transaction to 5% (i.e., 1/20 of the total capital). For example, with a $10,000 account, the single trade stop loss should not exceed $500. Use the "compound progressive" strategy: every time the account grows by 20%, recalculate the base position. This method not only expands profits but also preserves them.
2. Core Trading System: Micro Confirmation in Trends
1. Dual Cycle Positioning: Determine trend direction using the 4-hour chart, and look for entry opportunities on the 1-hour chart. Only trade in the direction of the major trend.
2. Key Level Trading Method: Wait for price reactions near previous highs and lows, and Fibonacci retracement levels (38.2%, 61.8%). Confirm entry with classic candlestick patterns such as engulfing and inside bars.
3. Simple Indicator Verification: EMA12/EMA26 golden crosses and dead crosses assist in judgment, and the RSI overbought and oversold zones (above 70/below 30) serve as potential reversal warnings.
3. Practical Case: Three Strikes in a Trend
In the upward trend of gold in March 2023:
First Entry: Price retraced to the 38.2% Fibonacci level, an engulfing pattern appeared, go long at 1945, stop loss at 1938, target 1960 (risk-reward ratio 1:2).
Second Position Increase: Price broke through the previous high and stabilized after pulling back to 1952, add position, move stop loss up to 1948.
Final Exit: When the 4-hour chart shows a clear divergence and the price breaks below the short-term trend line, close all positions in the 1980 region.
This wave achieved an 11% net profit with a total capital risk of 2.5%.
4. Emotional Discipline: The Guardian of the System
No more than 2 trades per day to avoid overtrading.
Stay away from the market after setting trades, protect positions with stop-loss orders.
Review all trades weekly, recording the emotional state of each trade.
After two consecutive losses, take a mandatory rest for 1 day.
5. Risk Response Plan
Black Swan Plan: Do not heavily invest based on news data under any circumstances.
Maximum Drawdown Control: Stop trading for a week if monthly drawdown reaches 8%.
Profit Protection: After the account doubles, withdraw 50%, and continue trading with profits.
Key Cognitive Shift
Real "position doubling" is not a single risky victory, but a steady increase in the capital curve achieved by strictly executing the strategy of "small stop losses, letting profits run" over a 3-5 month period.
