Reading all these posts reminds me of when I was first learning to play craps. After three days of playing as "smart" as possible, one of the dealers finally pulled me aside and asked, "so do you want to learn how to make some real money in this game or do you just want to nickel and dime it forever?"
What he knew then, and what I know now, is that in odds based games (such as craps and blackjack) you'll never make any money at all if you bet the exact same amount each time. An experienced player is going to do the exact opposite of scaling in (which is impossible with gambling) or scaling out (which would be the equivalent of reducing your bet after a win). The experienced gambler (who would argue that they're not really gambling at all....or at least as little as possible) would "press their bets up," and would continue to do so until the streak is over. Have you ever seen a good blackjack player bet $100, win, and then bet $50 or $100 the very next hand....Not unless they're counting and they knew the deck was raw....no, they press it up (which really means re-investing their profit), and bet $200 the very next hand. If they win that one maybe they increase their next bet to $300 and collect $100. If they win that one, the next bet might be $400 and they collect $200 or $500 and only collect $100. Same with craps, I can't tell you the number of times I've built a $12 bet on a 6 all the way up to $600, only to seven out and have made more in 8 rolls than I would have made if that stupid $12 bet had hit 30 times in a row. Its all about raising the stakes on somebody else's dime (this is of course assuming that you have the ability to mentally consider the money in play house money and not your money like most people would want to do).
This has been the number one thing that has helped me the most in my trading. The ability to build a position. If I enter a trade with 1 contract, I am pretty upset with myself if at the end of the move I still have 1 contract. No, I want to start with a small position and end a move with a large position...hopefully with a position larger than what I would have originally felt comfortable with. This is the exact opposite of averaging down on a losing position......this is averaging up on a winning position.
So the next time you're in a profitable trade, instead of thinking about getting out just because you're profitable, maybe consider taking some of that profit you have and re-invest it in your own trade the next time it retraces. Sure, you might get stopped out a little more on relatively small size, but when you finally catch that run you'll just kill it.
Also, I like to think about my trades as employees. I always think about how you reward employees for doing a good job, and typically don't give them raises for doing a bad job. Well, if I'm in a trade that hasn't done anything that I'm happy with except move against me, then why do I want to reward it with more size. Instead I would rather reward it when it does things that make me happy, like move in my direction, or take out swing highs or whatever it is you're looking for. If a trade does something to make you happy, then reward it by adding on to it, and don't reward it for doing things that make you unhappy or cause you stress.
