How can I effectively use stepping/Tanpin (doubling down) for arbitrage or hedging?

When you double-dip into a reversal and it goes bad, you get slapped back and forth

When you double-dip into a reversal and it goes well, profits keep coming

Will it succeed

Will it fail

or which one?

That is double-dip reversal

Is double-dip reversal effective?

From the perspective of stop losses, it is “effective”

However, the market is made by the trader’s expectations

In other words, the market moves in a way that wins for both sides

Sometime a market will come that you cannot understand

Sometime a market will repeatedly occur that is the exact opposite of your prediction

From the standpoint of this fact

Is double-dip reversal truly effective?

The answer would be no, right?

Eventually, double-dip reversal will fail somewhere

With that in mind

From the perspective of a single-shot stop-loss trade, it is more effective

Similarly, with nunping, you should trade from the single-shot perspective

By doing so

Since nunpin can be traded with the same single-shot action, it is effective

However,

double-dip reversal changes direction as the name implies

It triggers a large number of back-and-forth slaps and expands losses

By enforcing a stop loss

losses can be reduced

By incorporating market intuition and discretion

you can also escape from the back-and-forth slaps

In double-dip reversal you cannot escape from those back-and-forth slaps

Why is that

Because you believe there is a trend when actually it’s a false signal

Because you believe there is a trend

Since you believe in the trend,

you will continue to be slapped back and forth

Even if you widen the range, the win rate may improve, but

you will also enlarge the range of those big back-and-forth slaps

and you will incur such losses again

Behind double-dip reversal

there lies such a reality

Please always cut losses and take a break. This is essential