recovery System

Hello follow traders!

In this short manual I'll describe my newest trading system, which is based on a smart back-and-forth hedging strategy. When used in a proper way, this strategy can be extremely profitable and give you a huge advantage, because of its ability to turn every losing position into a winning one. Of course, this type of trading is not for everyone, there is some risk involved, but from my own experience it is very difficult to lose money with this system, but for sure, it can happen to anyone! My personal recommendations are:

1.Make sure you fully understand the system and all risk involved.

2.Use it in combination with your favorite entry strategy.

3.Avoid ranging markets! Quit as quickly as you can, even if it means to take some “acceptable” losses.

This trading system uses a smart back-and-forth hedging mechanism, that is continuously opening new positions according to the recent market movements. Each time a new position is opened, system tries to estimate a new Lot size, which is required to breakeven or to profit at the original TakeProfit, but ALSO at the original StopLoss level. This results in a group of open positions that eventually will always turn into a profit, when the market will go in either direction up or down. All trades are automatically closed when the overall profit reaches the pre-defined ForceTakeProfit level or pre-defined TakeProfit or StopLoss level. PipProfitOffset setting ensures that all new recovery trades are targeting slightly lower TakeProfit levels (w.r.t. the first open position). This results in slightly larger Lot sizes, than Lot sizes required to reach a breakeven condition. This additional offset allows to compensate for small losses, that are caused by spreads, slippages, swaps and commissions. The system is profitable as long there is sufficient level of FreeMargin to be able to open new trade positions. The overview below shows a theoretical recovery flow with corresponding Lot sizes and risk levels.

Illustration 3: “sell” position recovery example

Ideal recovery case, no rounding errors, spreads, slippages, etc..., PipProfitOffset=0

Note: In both cases all trades would result in a breakeven condition.  

Ideal recovery case, no rounding errors, spreads, slippages, etc..., PipProfitOffset=10

In this case each of recovery trades is targeting the original TakeProfit level - 10pips, what results in slightly larger Lot sizes, but also in faster recovery with a larger profit! In most cases this offset setting is required to cover for round-off errors, spreads and slippages or swap/commissions losses.

Note: With ForceTakeProfit parameter set to e.g.: 5, all trades would be closed much sooner, limiting the total risk and still resulting in some small profit!

Opening trades:

New trades can be entered by drawing a trend line with "/" MT4 tool and renaming it to "gl" for a long trade and "gs" for a short trade. New trade will be opened when the price crosses trend line in desired direction. That's it!.

Ideal recovery Lots size calculation example: