⚓Trading Philosophy & Method

Trading Philosophy

Perhaps the concept of Win Rate is no longer unfamiliar to traders in general, especially for novice traders who often emphasize or seek systems/strategies with high win rates of 80% - 90% as the path to success. This holds true for some professional traders who are fortunate enough to trade in line with the trend. However, this may not be a safe and sustainable trading philosophy to use in the long run. We weigh the predictive model at around 30% and invest in models optimized for capital and risk management in this article, including:

1. The Profit Factor, which measures the amount of money you will earn per dollar lost. The profit factor can be understood as the Risk:Reward Ratio.

2. The worst-case scenario (Max Drawdown), based on historical data that can be predicted in advance, allowing for appropriate leverage adjustments. In this report, we use low leverage, ranging from 3 - 10x.

3. And factors related to trade entry opportunities, such as the average number of days for a trade and the duration of profitable or losing trades.

Trading method

The model suggests the closing price of the next candle and the corresponding trades executed. If the closing price of the previous candle is lower than the predicted value, a buy trade is executed, and vice versa. The maximum loss is held at -0.36% of the capital because it is only slightly higher than the average value of price fluctuations in the opposite direction of our trades before moving in the predicted direction. This means that if at any point a losing trade exceeds 0.36%, that loss will be placed in the stop-loss system. When the model predicts that the closing price of the next price step (hour or day) will be higher, the model sends a long/buy signal for that currency and does not sell until the predicted closing price is lower for the next day/hour. When selling/shorting, the model also creates a new short position and follows it until the predicted closing price is higher. In other words, when in a long position and encountering a short signal, it is a sign to take profit or stop loss. Immediately after, a short sell order will be placed immediately, and vice versa for the short position.