Martingale Decoded · 9 min read
Understanding a martingale recovery cycle conceptually is one thing. Seeing exactly how each order opens, how the floating loss evolves, and how the cycle finally closes is more useful. This walkthrough follows a real-scenario four-order cycle on EURUSD H1 from entry to close.
The Setup
Account: $2,000. Base lot: 0.01. Step distance between orders: 25 pips. Take-profit for the full cycle: 15 pips above the weighted average entry price of all open orders.
Key Observations from This Cycle
- The cycle dropped 75 pips before reversing — triggering 4 orders at 25-pip intervals
- Maximum floating loss was $18.50 — on a $2,000 account this is less than 1% drawdown
- The exit target was 15 pips above the average entry — the average entry was 1.0856 so price only needed to reach 1.0871 for full close
- Profit was small ($1.20) — this is normal for martingale; the system makes many small wins to compensate for occasional larger losses when cycles fail
What If Price Didn’t Reverse?
If price had continued dropping beyond 1.0825, Order 5 would have opened at 1.0800 (0.08 lots), Order 6 at 1.0775 (0.12 lots), and so on up to Order 8. The cumulative floating loss at that depth would be several hundred dollars on this account — but still below the -65% kill switch threshold of $1,300 at a $2,000 balance. That is why conservative sizing is essential.
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