Who knows how this strategy works? I’ve been seeing people getting their accounts banned because of milking brokers and can’t seem to find enough information on it through the usual channels.
not true. just google
Google won’t break it down like someone who has actually used it and knows it’s workings
Martingale wachana nayo. It is basically averaging down until the trade turns in your favor. Unfortunately, it assumes that you have infinite capital and you are always right regarding the long term direction.
Example, assume that you bought more every time Luna dropped in price. When UST de-pegged against the US dollar, Luna started a death spiral.
Anyone who was long and using martingale blew their account because you can’t average down forever.
All it takes is one cataclysmic move against you and you blow your entire account to peanuts.
Even worse, martingale is not just simple averaging down. It’s doubling the size of the trade every time it goes against you. E.g. if you buy W amount at $10 and the price drops to $8, you buy W at $8. If it drops to $6, you buy 2W and so on. Each time, you double the amount of W you have until the trade turns into a winner.
Very well put. Much appreciated Mkuu!!