William D Jackson

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What is scaling in and scaling out in forex trading?

Scaling in involves adding positions gradually as a trade moves in favor, while scaling out reduces size as price progresses. Institutions use scaling to manage large orders without disrupting markets. Retail traders use it to manage risk dynamically. Benefits: flexibility, improved reward-to-risk, and adaptation to evolving conditions. Risks: improper scaling can turn winners into losers or dilute gains. The key is structured rules—adding only when trade setups confirm, and scaling out to protect capital without abandoning potential. Scaling techniques teach traders to think in probabilities rather than absolutes, improving equity stability.