Traders do say the market spends most of the time retracing. If this is true, then why is there so much focus on trend strategies? By focusing on trend strategies we miss out on most of the opportunities the market presents to us.
The market will revert eventually, you just don’t know when you need to be in the market to take an advantage of it, and indicators are generally too slow to tell you when to enter. Chances are you’ll probably end up paying more commission than profits!
It is said that Jim Rogers and Warren Buffet often average down their positions. If that is true then it can’t be that bad?
The easiest way to blow up your account averaging down is to scale in too aggressively, like a martingale strategy. This is because the larger the position you already have, the even larger position you would need to average down, meaning you will very quickly either run out of money or margin.
And that is the reason, I intelligently incorporated a smart strategy to scale in and it is even robust and not fixed.