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What is the Martingale method?

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مارس 21, 2023
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Martingale is a method that was invented by an American and then implemented by different traders with different methods.

The concern of old gamblers has always been how to get guaranteed profit from their work without risk. The old gamblers have thought a lot about this and the result is the results that they use in investing in the stock market these days.

One of these betting methods that has opened its place in business and investment, especially in the domestic and foreign investment markets, is the Martingale method.


Martingale method is used in bets where a person has two situations of winning or losing and the probability of occurrence of each of the conditions of winning or losing is also equal. The conditions are much better, but still, with the same conditions, the Martingale method is ultimately the winner).

Martingale trading is always profitable if used in the right way. Forex is not a gamble with a mathematical ratio of 50%. In today’s market, even if your strategy is not perfect, the probability of making a profit is very high.


Here we review 4 martingale enhancers:


Familiarity with Forex rules;

controlling feelings and emotions;

reduce transaction risk;

and increase profits.


Don’t worry if you’re making losses or your assets haven’t changed in years. Compare your trades with the method given below and update your trading system by finding missed points.


Most money is made from trading in the direction of the trend. Let’s take a look at the BGP/AUD chart:



At first, the trend has slow movement because the price is not yet attractive to traders. Please pay attention to the candle shadow before entering the new wave.


Predictable trends, ranges and candles are the keys to making profits for patient traders.


Sometimes the trend does not move in the desired direction and your trades are in losses. Do not worry; The process will continue and you will be able to log in again.


In your trading system, Martingale is a high stress capital management system. Therefore, to enter the market, be sure to prepare your checklist.


To get started, write down 3 simple things.


price in the direction of the trend;

Candles with their shadow;

Candles in the range of buying and selling.


Now let’s get the most out of forex: we show you how to maximize your profits; Especially if you currently have more failed trades.


Step 2. Trade cautiously


Consider these conditions:


You have had 10 successful transactions.

And 15 failed transactions.


Do you think your account is in total loss?


It is only in the rules of the game of roulette that the amount of your possible profit and loss is equal. for example:


We bet $1, then lose $1.

We bet $1, then win $1.


But in forex, it is the trader’s choice to set his profit and loss limit.


Traders form their trading systems in such a way that the amount of profit always exceeds the amount of loss.


The risk-benefit ratio must always be greater than 1.

We have used step 1:


We have entered the trade in the direction of the trend in the range where the candlestick shadow is located.

The loss limit is placed at the bottom of the candle shadow, at the nearest floor.


Let’s say we risked $10. Our profit will be $20: if our trade is successful, our profit is greater than the possible loss.


So the ratio of risk to profit in this transaction is 1 to 2.


Rule: We are not allowed to enter a trade whose risk-to-profit ratio is less than 1.5. With these conditions, even at the time of loss, you are usually in total profit.


Step 3. +40% efficiency


The result of the transaction in the direction of the trend along with the risk-to-profit ratio above 1 is equal to:


structural system,

A profit that covers a loss.


As of now, we are successful in 40% of our transactions and the account is in balance.


The advantages and strengths of forex have reduced the need to increase the success rate: we have reduced the minimum success rate.


Today, trading has become easier. Emotions have no place in our trading: Martingale can only be used with a calm mind.


Step 4. Reducing the Martingale factor


We have a profitable system; Because when the loss is doubled. We have obtained better benefits and conditions than other traders.


Most of the time we are in profit.

We earn more profit with less risk.

And we have our emotions under control.


The amount of profit exceeds the amount of loss: 1 profit covers 2 losing trades. So why double our trading volume after a loss?


You risk $50 and your prediction doesn’t turn out right.

You trade for $100 this time and still make a loss.

Your next risk will be $200, then $400, and then $800.


Every doubled trade you make will cost you double the loss, causing you too much stress.


What if your next deal doesn’t work? Has your system failed?


You are taking too much risk. But this pressure can be reduced; Just subtract the multiplier factor. This method can be a relief to your feelings.

However, your success rate will be more than your loss.


Why not just increase your trades by 0.5x this time:


So, you start your first trade with $100,

Then in the second transaction with only $150,

and inThe third time you will trade for 300 dollars. Still too much?


So reduce the coefficient again: for example 1.4 or 1.25 and 1.15.


Your advantages in forex: trends, ranges and capital management. Martingale will only slightly increase your profitability.

This is not the whole story. The amount of risk can be reduced even more


Step 5. Savings to deposit more


Business needs money and trading is no exception.


No matter how you reduce your martingale factor, the amount of trading risk still exceeds prudent risk. You need an acceptable deposit to withstand a sharp drop in your account balance.


Beginners are encouraged to deposit $500 and trade with 0.01 to 0.05 lots.

Professional traders are suggested to provide $2000 in their account and start trading with 0.5 to 0.2 lots.


What is the advantage of the Martingale method?


The advantage of the martingale method is that when the share price moves away from our initial purchase price and becomes negative, it can be implemented before the share price reaches the initial purchase price to enter the profit, instead of waiting for the price to reach the initial purchase price. We just get out of the loss, maybe in many cases it is possible that the share price will not easily return to the previous prices after the drop and we will have to get out of the deal that could have been profitable for us, eventually with a loss.



  But this method has a small flaw!


This method has been implemented by big traders and each of them has localized this method according to their trading systems and profit limit and loss limit. According to this method, we can do this several times and the lower the price, the closer the average purchase price to it. But the very important point is that our capital is not unlimited and we cannot make twice as much new purchases on our previous purchase forever, and after several stages of this work, the amount of purchase and the capital required for it will increase greatly.


  Now how to fix the small defect of Martingale method


The steps to do this should be limited to certain numbers so that it can be done. It is recommended to reduce the purchase steps to 3 steps, in such a way that we divide our capital into 4 unequal parts: 1, 2, 4 and 8. They are used at each stage of purchase (that is, your total capital is divided into 15 parts and one of these coefficients is used at each stage of purchase: for example, 15 million is divided into 1 million, 2 million, 4 million and 8 million).

With this division, if your initial purchase price decreases, you divide your loss limit into 3 parts, and every time the price reaches one of these 3 parts, you make the next step of your purchase.

As a result, you have met the loss limit, and if it is not activated and the share price grows from any price (both the first purchase and the last purchase), your purchase price is optimized, and with the first growth, your entire purchase will be in profit.

Answer honestly: Do you need the Martingale method?


We intensify the trade by martingale. If you follow our tips, you will enjoy effective and unemotional trading. So trade smartly.


Only 1 more question remains: do you need a martingale?


Martingale is a type of capital management.

Maybe it’s just better to focus on your trading system:

Go ahead and work on 1 arrangement of candles.

Increase the percentage of successful transactions to 60%.

Use different timings for trading.

You will enjoy your prudent trades with more than 60% returns and your assets will gradually increase. Why rush when your account is in good standing?

And instead of inviting you to express your opinions, let me make another suggestion:

Manage your trades: Look for candles that support your analysis. Split your trades, have 2-3 entry points and reduce your loss limit and increase your profit limit.