Trend Following with Reversal Trades and Stacked Positions
Summary
The system described opens trades in the direction of a rising or falling trend, with a configurable distance between subsequent trades. That distance also serves as the stop loss and take profit for a trade. If a buy closes at its stop loss, the system opens a sell in the opposite direction with a larger take-profit target, while continuing to add trades.
The trader decides when to close the accumulated positions. This creates exposure that can grow as trades stack, and the reversal trade changes the direction after a stopped-out buy. The description does not specify how trends are identified, how the larger target is calculated, or how trade size and portfolio risk are controlled. It provides no backtest or performance evidence, so it outlines a position-management approach rather than demonstrating profitability.
Key ideas
- The system buys during rising trends and sells during falling trends.
- A configurable price distance sets both the spacing between trades and each trade’s stop loss and take profit.
- After a buy is stopped out, the system opens an opposite sell with a larger take-profit target.
- Trades accumulate, and the trader chooses when to close the full set of positions.
- The description gives no evidence about performance or controls for the risk of accumulated exposure.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.