In this idea, we will analyse the method of hedging together
hedge permit you to have the possibility to not lose when you aren't sure about the trend
ideally this method is to be used when price fluctuate within a range.
This method have high risk so it's better to don't use it majority of the time but exceptionnally it can be rewarding
Mathematic of hedging:
concept : 1 long, 1 sell with Money management
for exemple if you trigger the sl of the sell(like in this exemple, you stay with the profit of long. it permit compensation and even profit
1% loss, win 2 or 3% you compensate loss and win 2%
when to use it: when price fluctuate in a range AND you are sure you can't be here when price will break the range (because you sleep, you make something else)
Now I repeat what I said in my last chart, I don't recommend hedging (it is to be used at very exceptional moment) because you increase the capital exposure and therefore the potential losses. But if one day you see all the conditions are here to take an hedge think about it. Don't use it each week or each month, find the fair middle. the best is to don't use it but it work.
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in this case got the sell with sl triggered and long gave me profit : compensated the loss and increase my account
I used it because I wasn't sure about next direction of the market and of course there was a range and have to go sleeping
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ideally range have to be very small like in this case
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adapt the MM to this method, for exemple if you usually risk 1% per trade divide this risk by the 2 positions : 0.5% risk long and 0.5 risk sell