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Risk management is the only edge you control
Position sizing from stop distance, the 1% default, and the arithmetic of drawdown.
Size follows the stop, never the other way round
Decide the invalidation level first, then compute the lot size that makes that distance cost exactly your risk budget. Lot size is an output, not an input. Choosing the lot first and then placing the stop wherever it fits is the single most common way accounts die.
For gold: risk amount = balance × risk percent. Lots = risk amount ÷ (stop distance in ticks × tick value). Our default risk is 1% and the engine rounds down to the lot step.
Why 1%
At 1% risk, ten consecutive losses cost about 9.6% of the account. At 5% risk the same streak costs 40%, and recovering 40% requires a 67% gain. The asymmetry of drawdown recovery is what makes small risk per trade non-negotiable.
A strategy with a 45% win rate will produce a run of six or more losses regularly. Plan for the streak you will definitely get, not the equity curve you hope for.
Correlation is hidden leverage
Three open gold positions are not three 1% risks; they are close to one 3% risk, because they will all be wrong at the same time. Our guardrails cap concurrent positions and daily trades for exactly this reason.
Costs that backtests forget
Spread, commission, swap on positions held overnight and slippage on news all shave real pips off every trade. On a scalping timeframe these can consume the whole modelled edge. Always discount a backtest before believing it.