One key advantage is removing emotions from trading decisions, which often lead to poor choices and financial losses. By following a mechanical system, traders can avoid common pitfalls such as overtrading, impulsive actions, indecision, and constant decision-making. Additionally, a well-designed mechanical system ensures risk control, preventing significant losses.However, potential pitfalls exist when employing a non-discretionary mechanical system.
Periodic updates are also necessary for a well-designed system to adapt to evolving market dynamics. Determining the right time for adjustments can be complex. Adhering strictly to established rules is crucial for the system’s effectiveness. Deviating from tested and refined rules undermines the system’s value and negates the benefits gained from thorough testing, so it is possible to abandon a profitable system too soon.
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Source: Daily_Forex - 🏆 567. / 51 Read more »
Source: Daily_Forex - 🏆 567. / 51 Read more »