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[HC]

... by the time that the trend was in line with the scout again, I am already making a good profit.  Sometimes, I am already in the money even though the scout is still losing.

Yes, this a real plus point of this method.  But got to becareful and keep an eye on the higher time frame - if trend change, I would just  scratch the trade.

What I am trying to reconcile at this point in time is that, by using this method, my swings were in the region of 6-10% either side of breakeven, ie my open DD could be as much as 10% whereby I'd close my trade (my only failed rescue).  On the other hand the profits were as high as 10% on a successful rescue attempt.  I bear in mind that these trades were made when I was still grappling with the method (actually I was just guessing that this was the correct way of doing it) and that the DD could possibly be much better improved.  My demo account is currently up 25% from about 4 maybe 5 actual days of trading, number of trades made was 6 if I can remember correctly.

Somehow I got a feeling that bug me to respond on this: I think you are trading a lot size too big for your account.   I just wish to point out that during this period, the currency is moving mostly in range bound zone, which make rescue easy.  However, if you look at Sept, Oct 08, days where impulsive move of 100 pips within minutes is common, once caught on the wrong side of the move, it can become very painful.

This bring me to another point which I have not make: don't underestimate the 1% a day's profit.  That is some 20% a month (assuming 20 trading days a month) if you can consistently do that, already beating many fund managers.

... when I log in onto my trading platform, I was actually looking forward to a mis-timed entry so that I could practice the rescue (crazy) 

Yes, I got that feeling too, especially when I have not a single losing day for a month now and end most trading cycle at worst  small losses, wanting to "anyhow" enter and rescue if necessary.  But I don't think this is the right way to mess with my real money .  Got to watch my ego and stop looking at that uptrending equity curve.

In fact, if you are reading TAF thread, there is a forumer called Leigh (http://www.forexfactory.com/showthread.php?p=2117282#post2117282).  She made a variation out from this trading method that do not required baby sitting so much:

Enter a selected direction of various pairs (at pre-determined lot size for MM), key in profit target and go to sleep.  When she wake up and loggin to her platform, some pairs will close out when target profit is reached, some pair will still profit which she can close out.  For those that is in a loss, she perform rescue one at a time while hedging the others.  This way she is rescuing a fraction of the size that she would trade just a single pair, and can mount a bigger recuse size, making a better rescue success rate.

But I like the original fti's method better, and if I can consistently doing what I am doing now is good enough.

[HC]

I also notice there are some similarity on fti's teaching to Turtle Trading Rule:

1. Scaling in of positions, so that when the 1st entry is wrong, the damage is small; and when entries are right, the profit is multiplied.

2. Risk control as price move in our favour - Tutle Rule uses a trailing stop, here we use scaling out and baby sitting.

[jjs]

Hi HC

You're right about my position size in a way:  I've followed the advice of breaking up the account into 20 units and only 1 unit was deployed at a time.  What happened or lack of on my part was PATIENCE.  The attack was carried out too early.  This resulted in too many units being deployed relatively close together.  Coupled with the big swings that you've mentioned, rescue efforts had to be made to recover a few units instead of just the scout.  The few units (about 3) had effectively become one big unit.

What really took my breath away was the profit.  You're right about the returns and seeing how this method has penned out, it has made me even more fearful.  Fearful of whether I got the MM correct, whether I've been overtrading, whether the demo period would be too short (fluke).  They say in trading you'll find out more about yourself.  How true!  I feel that even if the MM is correct, the lack of patience will eventually destroy everything.

[jjs]

A few things that I've noted in the last few days:

1.  fti spoke about observing the market form in the charts.  I find it easier to use bar charts than candlesticks for this.  With candlesticks, I am distracted by the "noise" at the lower TF.  With bars, I find it easier to focus on the chart as a whole.  It's a minor matter that's really up to individual's preference.

2.  I find the U/J a relatively "less" risky pair cf to E/U or cable.

3.  Hc is right that any mistake can take out a week's or even moth's worth of effort.  The concept of no stop loss can easily fester the mind into thinking that there is no need to cut loss.  fti has advised on a 3 x daily average P/L as the limit.  I'll keep that in mind.

Am still reading and continuing to learn...

[HC]

jjs:

1. I trade EU mostly, and sometimes UJ.  I prefer EU because of smaller spread.

2. Yes, the risk/loss control part is very critical, and very often it is our mindset (ego, fear, greed, revenge) that get in the way and blind us from the danger.  The rescue operation is something not to be taken lightly, no matter how many times we have successfully performed it.  Due the the snowballing effect, the open DD can escalate exponentially very fast.  So my take is not to recuse too soon, and always have a second thought on "what if this rescue is stuck".  I try not to overstay my rescue army especially when the size is large.  I will quickly exit my recuse army in sight of any trouble, even at zero profit of that recuse position.

3. My objective of rescue operation is to get the whole cycle in breakeven, or a small profit.  Once reached, usually the scout and army are all take out from the battle field and the chart is re-access without a position.  Only when I am quite certain of the chart is in my favour then I stay slightly longer, even then usually I am more incline to just leave the scout and close out the army (first).  My reason being that if a trade that required multiple rescues, the chart landscape may have changed sufficiently to raise a red flag, and closing all out to have a clear mind is better.  Missing profit is much better than has to do further rescue.

4. If I am doing a counter trend trade on a "seemingly extended trend" (ie, trading a pull back), I usually use a smaller lot size, don't do attack, and don't recuse but just cut loss.

5. If I wish to establish a position in a place that is less than ideal (because I am afraid that I may miss the move), I enter at a reduce size.  This will make the rescue/cut loss easier.

6. Even though fti advocate using only price chart, till now I still cannot get rid of the MAs.  I am still using them to gauge the correct side of trade.

Still learning...