Calculating risk

Hi folks.

I have recently modified my trading process and would like some feedback about it.  I used to structure a trade according to what is my standard full compliment and what percentage of that compliment will I put on at different stages.   Now I approach it based on what my maximum potential loss is at any one time.  It is all from what Paul has taught.  This is my interpretation of it.

Example: Entering a gold trade long.  For demonstration purposes I will say my maximum acceptable loss on a HP trade is $100.

1. Enter trade and establish stop loss.  Adjust contract size so stop loss is $100 or less.  

2. Decide where price needs to rise to before I can bring the stop loss up to break even or better still a few dollars profit.   (I enter a price alert notification in CMC)

3.  If price hits this level.  Bring stop loss up to break-even/small profit.  At this stage I can either leave it as it is or add to my position.  If I leave it as it is then from then on its free money.

4. If I add to my position I keep the same stop loss and add enough contracts to keep the maximum loss to less than say $50.  Maximum risk is reduced but maximum potential gain increases. Look for next price target to break even. 

5. When price target is reached bring stop loss up to break-even/small profit.   Add contracts to keep maximum loss to $25.   So on and so forth.  

I found using this approach I always know my maximum potential loss.  If I have a $2000 account I know I will need 20 consecutive high probability full losses to lose my account.  It also helped to shift my attitude from "missing out on profits" to "getting free money".  

An analogy I think of is if I knew there was a place where I always find $1 and $2 coins and $5 notes lying around I would probably go there on a regular basis and pick up some free money.   This is how I see this type of trading. 

I have different maximum stop loss amounts depending on the type of trade it is.  Small ones for experimental trades, medium for consolidated patterns up to largest for good HP moves.  I track the profit/loss of different catagories.  If I blow out the experimental allocated amount for example then I can't trade those again until I have made some more profits from the others.

 My current risk profile (its not $100) means I will have to lose consecutively 40 HP trades, 20 consolidation pattern trades and 20 experimental trades.  If that happens I think I better go back to a demo account. 

The entry trade is the "buffer" trade. It is not intended to make profits.  Its only purpose is to establish a break-even stop loss position in order to build on.  

 Lets say over several trades I accumulate $600 on top of my initial $2000 account.  I can then do a couple of trades with $200 or $300 stop losses.   If they are successful my account pushes up quicker and the overall stop loss threshold can probably come up too. If not then worse case scenario Im back to my original account size. 

Is this how other folks trade?  Any other tips you have discovered to be helpful ?  Is there anything about my risk adverse trading approach that you would do differently or that you see as potentially counter productive to being a better trader? 

Regards
Nathan