Multiple targets vs. Single targets ( weekly review )
Published: 2016-04-13
Status:
Available
|
Analyzed
Published: 2016-04-13
Status:
Available
|
Analyzed
Predictions from this Video
Incorrect: 0
Prediction
Topic
Status
The speaker predicts a 70-80% chance of a market reversal after a cipher pattern completes, reaching at least a 382 retracement.
"And I also know that I have between a 70 and 80% chance of this market turning around after the cipher pattern completion and at least hitting a 382 retracement."
Pending
The speaker successfully executed a trade based on a cipher pattern, reversing a previous position and hitting targets after a 382 retracement.
"So, we came up to our cipher pattern completion. I reversed my position and we came down past the 382 which hit my targets for the cipher pattern."
Pending
A cipher pattern on the Euro Aussie resulted in a successful trade where the market hit the 382 retracement, serving as the target.
"Here the cipher pattern is coming in from X to A, A to B, B to C. A CD completion right up here. As you can see, the market did come down to hit the 382 retracement, which is where I take my targets off for the cipher pattern."
Pending
The speaker indicates that after breaking three resistance levels, it is safe to enter a 786 retracement trade, expecting an upward trend.
"As we can see here the market has broken one, two, three resistance levels. So that means I am safe to take a Fibonacci retracement from my swing low here to my swing high and purchase the 786 retracement."
Pending
A 786 strategy trade, with targets at previous resistance, was successfully executed, resulting in profitable pips.
"As you can see, the market did come up and hit the wouldbe targets here. This trade we were involved in and did manage to win some pips."
Pending
A 786 retracement trade was entered after breaking resistance, with targets at previous resistance, and these targets were hit, followed by a break of a new resistance level.
"So we break this resistance here, take a Fibonacci retracement from our swing low to our swing high and we purchase the 786 retracement here looking for targets up at previous resistance. As you can see, we hit those targets and while hitting those targets, we did break above the previous resistance level here"
Pending
After breaking multiple resistance levels, it is deemed safe to buy the 786 retracement, and the targets were subsequently hit.
"So, safe to take the 786 retracement and purchase it. And as you can see, we did come up to hit targets."
Pending
To achieve the same profit as a single-target system, a two-target system must generate at least twice the number of pips.
"So, what does this mean? This means that if you're going to trade two targets on any strategy, then your two target system must at least make twice as many pips as a one target system in order to make the same amount of money."
Pending
For a two-target system to be financially equivalent to a one-target system, the second target must yield the same pip count as the first target.
"So your second targets must at least produce the same amount of pips as your first targets in order for you to be even with someone just trading one target."
Pending
Testing for multiple targets is crucial because market trends do not always continue, and reversals are common.
"Now the reason that it is very important to test for multiple targets on any of the strategies that you decide to trade is because the market does not always continue in trend does it? Sometimes we will see something like this in the market."
Pending
In a scenario where the market reverses after hitting the first target, a trader with one target makes full profit, while a trader with two targets only realizes partial profit from the first target.
"And in this case, trader A has made his $160 hitting target one and he's out of the trade completely. Trader B has made $80, $1 per pip on his 80 pip win here. And he is still in the trade."
Pending
Taking two targets can lead to an inverted risk-reward and potentially less profit on a trade compared to a single target if the market reverses prematurely.
"So, not only does trader B have a inverted riskreward, trader B also because of taking two targets has made less money on the specific trade."
Pending
For a multi-target strategy to be more profitable, the second target needs to be hit with high frequency.
"Because in order for this strategy to be more profitable with multiple targets, then this second target must be hit very often."
Pending
Hitting second targets 40-50% of the time will result in increased pip gains.
"But if you hit your second targets 50% of the time, 40% of the time, then you're going to make more pips because of that."
Pending
The effectiveness of multiple versus single targets depends entirely on the strategy, and can only be determined through historical backtesting.
"So, are multiple targets really better than single targets? That is completely determined by the strategy you're using? And the only way to determine whether or not that is the case is by testing that strategy over time throughout the market's history in order to see whether or not taking multiple targets has produced you with more or less profit throughout time."
Pending
The speaker's trading strategies have performed well over the past 5-6 months, consistently applied on a single timeframe.
"So far, the strategies have performed really well over the course of the last five or six months. We've been trading we've been trading the same strategies that I teach here on my YouTube channel consistently throughout the markets on only one time frame."
Pending
Over six months of trading on a single timeframe, approximately 1,859 pips have been accumulated.
"And so trading for six months on only one time frame, we have managed to accumulate around 1,859 pips."
Pending