Hedge Trading Explained

This video tutorial explains to you hedge trading and how I use hedge trading in my day to day trading regime. Right, so let's say right now the second candle has opened above the 8 exponential moving average and you place a buy trade over over here. Alright, so it's buy trade long. And then let's say for example news comes out. Let's put in the 8 exponential moving average. So let's say it goes north. And then we get a big piercing candle, big engulfing red candle, one that goes over here. Get a red candle here. And we get a red candle that opens here. All right, so I've got a buy trade that's open. So what do I do with these, what do I do with these buy trades that are in loss? I leave them. Okay, I, I'll open up a sell trade. I'm going to put the sell trade over here. When the second candle opens below the 8 exponential moving average, I'm going to put in a sell trade. Okay, that's my sell trade. Okay, I'll make the sell trade the same lot sizes as these two buy trades combined. That means I'm 100% hedged, which means that no drawdown can happen to my account. So if I've got a lot size bar to the value of one and I've got a lot size of sell to the value of one, it's equal. Therefore no drawdown can happen on my account. So what is the drawdown? So it's this number over here on the account. So this number over here. Okay, nothing happens to that number. It stays the same. All right, if I've got a bar and a cell to the equal value lot sizes. Alrighty, so when, when do I close? When do I close my, my sell trade? All right, so when the second candle opens above the 8 exponential moving average, that is when I will, I will close my, my sell trade and I will then open a buy trade. So the second candle opens above the 8 exponential moving average. I've already got two sell trades here. These are. Sorry, two buy trades. These are two buy trades. And I will close this sell trade in a profit. And I will then open a buy trade. Okay? And I will ride the price north. Okay, I'll ride the price north until it reverses. And this trade here. So I've now got three bar trades open. I've got a buy trade here, I've got a buy trade here, and I've got a buy trade here. So I've dollar cost average and I'm dollar cost averaging. All the way north. Okay, now if for example, all of a sudden this buy trade fails, then I will place a sell trade when the second candle opens below the 8 exponential moving average. So to hedge those four bar trades. So I've got all three by trades, one by trade. So I'm going to buy trade here, I've got a bar trade here and I've got a bar trade there. So I've got 3, 3 by trades, 3 by trades. All right, so when the second candle opens below the 8 exponential moving average, depending on the sentiment, again, so if the sentiment is 85 or 95%, I don't think I'm going to place a another sell trade. I'd rather wait a little bit. So if you've got a high drawdown, then you need to place the sell trade. So place a sell trade when the second candle opens below the 8 exponential moving average. And the sell trade would be, if you want to be 100% hedge, then you will use the same lot sizes equivalent to your bar trade. So if you've got bar trades to the value of four lots, then your sell trade must be four lots and then you're 100% hedged. So that is the basic explanation of what hedge trading is and how it works. And if you come to my seminars, I explain it more to you and I'll show you exactly what I'm doing. And I do trade live on those seminars to explain to you exactly exactly what I'm doing. So I hope that you found this video informative. If you did, then please leave me a comment, give me a thumbs up and subscribe to my channel on YouTube because it helps you get the correct videos from the YouTube algorithm. So like, subscribe and comment on my videos and I'll see you in my next video.