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Improving Consistency In TradingThis is always one of the biggest challenges to becoming a full time profitable trader. Almost all traders will have a battle against becoming consistent. Its something that I definitely struggled with when starting out in my trading journey. 
I would go through weeks of profitable trades and building my account and then equally go through losing streaks and essentially wiping out my wins. Or simply from one week to the next my trading results would fluctuate like crazy… This will inevitably have a detrimental effect on your trading results but more importantly it will have a major negative effect on your mentality and well being as you become more and more frustrated with inconsistent trading results. So today I wanted to sit down and go through this in topic to explain some ways to combat this problem and improve your consistency. Expectations Firstly its important to define the goal… what does consistent trading look like FOR YOU? Because believe it or not, the answer to that question is different for different people. 

So, are you looking to be consistent over the course of each day? Over the course of each week?… Define a time period that is realistic for you to determine your consistency and make sure it has enough time to measure enough trades to account for wins and losses. Are you looking to be consistent in terms of profit over this period of time? Or are you looking to be consistent in terms of percentage of trades won and loss? Secondly its important to know that you WONT win every trade.. so any goal that sets out to do so won’t be realistic and won’t be achievable. 

Winning 80% of your trades is a VERY consistent win rate percentage. 
 No Silver Bullet The honest truth is that there’s no secret formula or special sauce that will turn an inconsistent trader into a consistently profitable one overnight.

As with everything it will take gradual steps of improvement but I can share with you some methods and insights to help speed that process up. 
 Consistent Results Come From Consistent Processes
 The main reason behind inconsistent results is that traders are using an inconsistent process for each trade they place. 

If one trade is placed based on one strategy and then you are not using that same strategy on the next trade then you can expect any trading results will reflect that. 

Its important to understand your strategy in trading intimately… you should have the confidence in your strategy that if you were to lose a trade, you are confident that over time your strategy will work out. 

Typically this scattergun approach where traders jump from one strategy to the next is the main cause of why their results are inconsistent. 
 Review Your Strategy Finally you must of course have a very robust strategy to use in the first place… if the strategy you are using isn’t robust and doesn’t provide an ‘edge’ on the market… if you haven’t done the research and backtesting necessary to know your edge on the market then you can be sure that any result from using that strategy will be inconsistent.
OANDA:XAUUSDEducation
by JoelWarby
81
Candlestick Charts Part 3: ContinuationHello everyone, as we all know the market action discounts everything :) _________________________________Make sure to Like and Follow if you like the idea_________________________________ NOTE: some pattern could be reversal and continuation patterns depending if its in an uptrend or downtrend. Today's video will be about the Candlestick Chart : Continuation Patterns. Continuation Patterns are candlestick patterns that tend to resolve in the same direction as the prevailing trend. So lets start by talking about the different types of Patterns : Bullish Continuation Patterns Bearish Continuation Patterns And they are divided into 3 groups : Weak Patterns Reliable Patterns Strong Patterns We Start with the Strong Continuation Patterns : 1) Rising Three Methods : is a five candlestick bullish continuation pattern. The first candlestick is a large bullish candlestick that takes place during an uptrend. Then a group of two to four small body candlesticks (either bullish or bearish) retreat within the price range established by the first day’s real body bullish candlestick. The final candlestick of the pattern is another large bullish candlestick that closes above the first day’s closing price. 2) Falling Three Methods : is a five candlestick bearish continuation pattern. The first candlestick is a large bearish candlestick that takes place during a downtrend. Then a group of two to four small body candlesticks (either bullish or bearish) slowly ascend within the price range established by the first day’s real body bearish candlestick. The final candlestick of the pattern is another large bearish candlestick that closes below the first day’s closing price. 3) Deliberation in an uptrend : A deliberation structure is comprised of three Japanese candlesticks. All three are bullish (green). The first is a candlestick with a small body followed by a large full candlestick. Finally, the last candlestick also has a small body and forms a star. 4) Concealing Baby Swallow in an uptrend : The Concealing Baby Swallow is a four-line candlestick pattern, which appears so rarely. Two Black Marubozu candles appearing one after the other are very uncommon situation on the candlestick charts what limits the appearance of this pattern. Now Lets Talk about the Reliable Continuation Patterns : 1) Bullish Separating Lines : Bullish separating lines pattern is a two-candle bullish continuation candlestick pattern that comes up in the middle of a bullish trend. It indicates that the current bullish trend is about to continue after a temporary pullback. 2) Bearish Separating Lines : The bearish separating line is known as a bearish continuation pattern. The first line is a white candle that comes up as a long line in a downtrend. The second line is made up of a black candle that comes up as a long line. Both bars will open at the same price, and then the prices are separating. 3) Bullish Matching High : This pattern involves two or more matching highs. On a lower timeframe chart this pattern will look like a support or resistance being broken. Breakouts are used by traders a trigger to enter the market with the momentum of the breakout signaling a new leg of a trend. 4) Bearish Matching Low : This pattern involves two or more matching lows which if broken is a signal that there will be a resumption of the current trend. 5) Upside Tasuki Gap : It is a bullish continuation candlestick pattern which is formed in an ongoing uptrend. This candlestick pattern consists of three candles, the first candlestick is a long-bodied bullish candlestick, and the second candlestick is also a bullish candlestick formed after a gap up. The third candlestick is a bearish candle that closes in the gap formed between these first two bullish candles. 6) Downside Tasuki Gap : Downside Tasuki Gap is a bearish continuation pattern that forms in the middle of a downtrend. The first candle is bearish, and is followed by a negative gap and another bearish candle. The third candle is bullish and closes right in the gap between the first two bars. And Last but not least The Weak Continuation Patterns : 1) Advance Block : The advance block is a three bar pattern. The pattern appears as a block of three white, rising candlesticks, each with a shorter body than the last. The candles should not have overly long shadows as these can sometimes develop into other pattern types such shooting stars and hanging men. 2) Stick Sandwich : The stick sandwich candlestick pattern can occur in both bull and bear markets. The stick sandwich candlestick pattern consists of three candlesticks, where one candlestick has an opposite colored candlestick on both sides. The closing prices of the two candlesticks that surround the opposite colored candlestick must be same. 3) Bullish Side by Side White Lines : – It occurs during an Uptrend; confirmation is required by the candles that follow the Pattern. – The First Candle is white. – Then there is a Gap Up between the First and Second Candle. – The Second and Third Candle are white, their Real Bodies have the same length; moreover they have the Open at the same level (More or less) and is above the Real Body of the First Candle. 4) Bearish Side by Side White Lines : – It occurs during a Downtrend; confirmation is required by the candles that follow the Pattern. – The First Candle is black. – Then there is a Gap Down between the First and Second Candle. – The Second and Third Candle are white, their Real Bodies have the same length; moreover they have the Open at the same level (More or less) and is below the Real Body of the First Candle. 5) Bullish On Neck Line: The on neck candlestick is a continuation pattern. In an on neck pattern, the first candle is Bullish and the second one is Bearish. The first candle’s body is long while the second one is shorter. The second candle closes near the first one or close to the first candle. The pattern gets its name because at the point where the closing prices of the two are nearly the same or same, it forms a horizontal line which looks like a neck or a neckline. 6) Bearish On Neck line : The on neck candlestick is a continuation pattern. In an on neck pattern, the first candle is bearish and the second one is bullish. The first candle’s body is long while the second one is shorter. The second candle closes near the first one or close to the first candle. The pattern gets its name because at the point where the closing prices of the two are nearly the same or same, it forms a horizontal line which looks like a neck or a neckline. I hope that I was able to help you understand Continuation Patterns in Candlestick Charts better and if you have any more questions don't hesitate to ask. Hit that like if you found this helpful and check out my other video about the Moving Average, Stochastic oscillator, The Dow Jones Theory, How To Trade Breakouts, The RSI , The MACD , The Bollinger Bands , The Different Types Of Trading Strategies, Candlestick Charts Part 1 & 2 links will be bellow
COINBASE:BTCUSDEducation
by GabiDahduh
36
GANN Theory Finally Completed StrategyI took a couple of months off to read a book i found on Amazon on Andrew Gann the inventor of GANN theory. After finishing his article i theorized that it could be transformed in these modern times. This will a Membership to perform, Alerts mean allot to people that want to automate the thought process behind this. Please note that i am not a paid person posting this, i been trading for 16 years ever since i graduated from High School, I went to college to understand Pattern Recognition. Believe it or not there is a pattern to every aspect of our Lives. I have the MTF Support and Resistance from Annan Set to Daily . Poor Mans Volume Profile ___ this is critical for plotting the GANN BOX onto the Charts with little to no thought process. To plot the GANN BOX (not the GANN fix Box or the GANN angles) You are taking the Gann Box Placing it on the Poor Mans Volume Profile DAILY chart. For an Uptrend you go UP 2 and right 2 , you'll understand when you plot it. For Down Trend down 2 right 2 . Sideways (rangebound) oddly special one. Up 1 Right 2 Down 1 Right 2 . When your plotting on the charts LOCK the Gann on the chart. I use Daily Right 2 because i set it at the beginning of the MONTH and its good for until the NEXT month. you set alerts on the GANN FIB LINES. (ENTRYS) BASED... If you are having issues with plotting this LET ME KNOW... its gets very automated when you plotting it. The Poor Mans Volume Profile takes the calculations out of the picture. Posting a picture of the Points your going up or down 2. How you Plot it on the Poor Mans Volume Profile. last step is to LOCK it on the Daily CHART. Alerts need to the be set on the 2 of the Gann Lines. ( set to Crossing ) Subscription premium allow you to set an unexpired alert. If you want to Swing with this strategy. You have to do something different by Anchoring on the Weekly and trading on the 30 min or 1hr you can swing with this. But as yourself are you going to swing or are you going to Day-trade this. Stop loss is a very touchie subject that everyone should think about doing... Personally i use 4 different methods Count 5 bars back, last Swing point, or Halfway between the two fibs of entry. if i am feeling lucky just on the other side of the Fib Entry point. * the Lucky part of this one is if it goes bad you have a very LOW LOW risk of loosing allot of hard earned capital. Generally I will use the 5 bars back method. CM- Slingshot set to Conservative. Next 2 will be the Exits on the Trades and Indicators to take the Trade. DYNAMIC RSI - DRSI for short just tweak the color on this one, from DreadBlitz. ____ MTF RSI from Chris Moody 14 70 30 D D 30 ___ set a color where you can see the MidPoint. NOTE: When Entering you are looking at the Chart___ when it crosses the GANN FIB line. after the Bar completes, look at the DRSI and MTF RSI midpoint cross. (after the Cross has Happen and you can Confirm it on both u can now Enter the Trade.) The exit point is when the DRSI goes Solid Filled color, secondly this effect will be happening on the MTF RSI. I take all of my trades on the 15min timeframe with an Anchor on the Daily Chart. Anchor meaning MTF MTF MTF MTF all of them are set to the daily. I want to make thoughtful readings based on the Daily Overall proceedings of the market direction.
NASDAQ:AMGNEducation
by Mnbrass549
20
Triangle Patterns - Advanced AnalysisChart patterns describe distinct structures in financial time series. Their occurrence helps technical analysts predict future price variations. Triangle patterns form a part of the most studied patterns by technical analysts and have been well documented over the years, with some even applied to climate time-series data (1). In this post, we perform an analysis of ascending, descending, and symmetrical triangles patterns. We provide a description of each pattern and its implications, as well as a model of the price variation within each described pattern. We also review the literature in order to find their deterministic cause. To knowledgeable investors, chart patterns are not squiggles on a price chart; they are the footprints of the smart money. - Bulkowski (2) 1. Ascending Triangles Ascending triangles are characterized by a series of rising local minima (higher lows) and a series of local maxima staying at a relatively fixed level. A line is drawn from the rising minima, forming an upward sloping support line. Another line is drawn from the maxima, forming a horizontal resistance line. The apex represents the point where both lines intersect. Ascending Triangles have a bullish bias. Once the price breaks the resistance line we can expect a rapid increase of the price. This breakout is often accompanied by an increase in volume, while the volume prior to the breakout was declining. Note that this is not a pre-requisite. Example of ascending triangle on CALX daily. 2. Descending Triangles Descending triangles are characterized by a series of declining local maxima (lower highs) and a series of local minima staying at a relatively fixed level. A line is drawn from the declining maxima, forming a downward sloping resistance line. Another line is drawn from the minimal, forming a horizontal support line. Descending Triangles have a bearish bias. Once the price breaks the support line we can expect a rapid decrease of the price. Like ascending triangles, this breakout is often accompanied by an increase in volume, while the volume prior to the breakout was declining. Example of descending triangle on CORN daily. 3. Symmetrical Triangles Symmetrical triangles are characterized by a series of declining local maxima (lower highs) and a series of increasing local minima (higher lows). A line is drawn from the declining maxima, forming a downward sloping resistance line. Another line is drawn from the minima, forming an upward sloping support line. Both support and resistance lines should have an approximately equal slope. Symmetrical triangles do not have a particular bullish or bearish bias, and are sometimes used to indicate market uncertainty. The expected outcomes depend on where a breakout is occurs. If the price breaks the resistance, we can expect an increase of the price, while a breakout of the support can be followed by a decrease of the price. Example of symmetrical triangle on PFO daily. 4. Pattern Modelling Describing price variations within patterns with a general mathematical formulation can help us describe more complex occurrences of the patterns. Consider the price within a valid triangle as y'(t) , with support S(t) and resistance R(t) . We can describe y'(t) as follows: y' = S + A × (R - S ) + e with A(t) approximately periodic and in an approximate range (0,1) and e(t) as noisy component. We can see that A(t) is subject to linear damping (the amplitude of price variations within the triangle tend to reduce linearly over time). This model is very general and can be further developed, but it can be used as the basis for assessing the validity of triangle patterns in the next section. 5. Pattern Validity The validity of a triangle pattern can depend on a wide variety of factors and can change from analyst to analyst. The price concentration around the support/resistance should be relatively even, that is price should fill the triangle (as described by Bulkowski). Bulkowski strongly suggests at least two minor highs and two minor lows should be inside the triangle formation. An additional filter is introduced by Bulkowski, the 5% failure , suggesting that a breakout should have a relative distance superior to 5% from the broken line in order to avoid reversals. Our previous model can be used to determine the validity of a potential triangle pattern. The apex angle is directly related to the magnitude of A(t) and e(t) , with lower angle values returning a lower signal to noise ratio. This is bad since A(t) is an essential component for the structure of the triangle. If A(t) ≈ e(t) then we cannot validate the presence of a triangle pattern, since it is more likely to have been the result of noise. 6. Measure Rule The measure rule allows anticipating the magnitude of a breakout. This allows the trader to easily set take profit/stop losses, which enables a higher control over the risk a trader would be taking trading a triangle pattern. For ascending triangles the predicted magnitude of a breakout is equal to the value of the resistance minus the first local minima inside the triangle. For descending triangles the predicted magnitude of a breakout is equal to the value of the first local maxima inside the triangle minus the support value. For symmetrical triangles, the predicted magnitude of a breakout is equal to the highest local maxima inside the triangle minus the lowest local minima inside the triangle. We can see that for ascending and descending triangles, a breakout of the non-horizontal line would imply a weaker breakout the closer the price is to the apex. In fact, the breakout magnitude would decay linearly. This is also true for symmetrical triangles. This is mentioned by Fisher (3): - The more the price moves to the very end of a triangle, the weaker will be the breakout in either direction. 7. Theoretical Explanation Of The Occurrence Of Triangle Patterns Explaining the presence of patterns in financial time series is a challenging task. Under a purely efficient market the presence of patterns would simply be the realization of random fluctuations. A more challenging question would be: "how could market participants cause triangle patterns?" If we assume that market participants cause the patterns, we know from the pattern descriptions that a mechanism inducing damped oscillatory variations exists. This oscillation is explained by Caginalp and Balenovich by two groups having asymmetric information/opinions (4). Certain analysts describe triangle patterns as a temporary control switch between sellers and buyers, with scenarios being determined by the amount of energy exhausted by buyers and sellers. 8. Conclusion In this post, we provided a description of triangle patterns. We highlighted the link between the signal-to-noise ratio and the apex angle of a triangle in order to determine its validity, as well as the measure rule for predicting the magnitude of a breakout. We finally briefly mentioned the theoretical explanation behind the occurrence of triangles patterns in the market. This subject is complex and lacks further research, we highly recommend reading Caginalp & Balevonich on the subject. Bulkowski offers an extensive number of statistics regarding triangles in his encyclopedia of chart patterns. 9. References (1) Kaiser, J. (2016). Chart Pattern in Climate Time Series Data . Urban & Regional Resilience eJournal. (2) Bulkowski, T. N. (2021). Encyclopedia of chart patterns . John Wiley & Sons. (3) Fischer, R., & Fischer, J. (2003). Candlesticks, Fibonacci, and chart pattern trading tools: a synergistic strategy to enhance profits and reduce risk (Vol. 209). John Wiley & Sons. (4) Caginalp, G., & Balevonich, D. (2003). A Theoretical Foundation for Technical Analysis . Capital Markets: Market Microstructure eJournal.
COINBASE:BTCUSDEducation
by LuxAlgo
60
What is the relative strength index? - Guide Part 40The RSI is an oscillator type indicator that reflects the relative strength of bullish movements, compared to bearish movements. It is used by traders to measure the strength of a trend and detect end-of-trend signals. The RSI indicator provides valuable market information and trading signals. Measures the interaction between up and down movements, and normalizes the calculation so that the index fluctuates in a range from 0 to 100. RSI Formula Contrary to many opinions, the RSI indicator is a leading indicator among stock market indicators. The RSI formula has 2 equations present that are involved in solving the formula. The equation of the first element receives the initial relative strength cost (RS), which is the average of the bullish closes above the average of the bearish closes, during a period "N" represented in the following calculation: RS = Exponential moving average of 'N' bullish periods / Exponential moving average of 'N' bearish periods (in absolute cost). The cost of the RSI indicator is calculated by indexing the indicator to 100 using the following formula: RSI = 100 - (100/1 + RS). Interpret RSI - How the RSI indicator works The RSI indicator is valid for any asset and any time horizon. As we have already said, it suggests the relative strength left to the asset in question. It comprises 2 static lines, at 30 and 70 (although a line can be increased by 50 to give extra information) and a moving average (RSI average). This average is what serves as a point of reference. The RSI indicator window could be as follows: How to interpret the RSI? • RSI indicator around degree 30: reflects oversold levels, as well as suggests that costs have accumulated relative strength. In this situation, we are talking about a situation in which costs have fallen sharply and now displacement could lose steam. • RSI indicator around degree 70: reflects overbought levels, as well as also suggests that costs do not have accumulated relative strength. This is a situation where costs have risen sharply and displacement is likely to weaken. • The RSI indicator oscillates horizontally around the 50 degree: it assumes that the market is lacking a trend. The 50 degree is the middle line that separates the bullish and bearish countries of the indicator. It should be noted that in other terms it is configured by default. The closer the degree is to the 100 area, the fewer trading signals will be identified by the RSI indicator. The closer you are to the 50 degree, the more signals you will have (including false signals). Therefore, this trading indicator gives data about the direction of the market trend, but also (and above all) about its strength. This will help the stock market investor to decide whether he wants to continue the trend or, on the other hand, to monitor a change in trend to change direction. It should be considered that once costs are overbought and / or oversold, it is once aggressive scenarios are commonly seen in the same direction, that is, if we see overbought in cost, it is feasible that we see an aggressive upward scenario. and, on the other hand, if costs remain oversold, costs have the possibility of interpreting an aggressive downward scenario. RSI Technical Study - Interaction of RSI with Trend Lines The design of the RSI trend lines uses the same methodological concepts as in the cost curves. You simply have to connect the vertices of the RSI indicator and trade the separation on the trend line. • To draw an uptrend line on the indicator, you must connect 2 or 3 or more vertices of the RSI indicator while increasingly higher views appear. • However, a descending line is drawn connecting 3 or more peaks as the viewpoints descend. The separation of a trend line from the RSI could indicate a viable continuation or reversal of costs. Make sure that the dissolution of a trend line in the indicator frequently precedes the dissolution of a trend line in the main chart of your asset, thus providing an advance warning and a possibility to anticipate the movement and establish the trend. • RSI example: technical study with trend lines Is the RSI 14 the best option? Several scalping traders will trade RSI 14. But what does RSI 14 mean? Simply that you select 14 periods in the indicator settings once you add it to your Tradingview chart. Therefore, you can choose the number of periods yourself in the RSI calculation. The shorter the number of periods, the faster the RSI will follow the current market trend. • For a 9 RSI on a 1 minute chart: the RSI indicator corresponds to the average of the last 9 min. • For a 14 RSI on a 5 min chart: the RSI indicator is the average of the last 70 min. • For a 25 RSI on a 1 day chart: the RSI is the average of the last 25 days. Advantages and disadvantages of the RSI indicator The main advantages of the RSI indicator are: • This indicator makes it possible to see at a glance if the market is in overbought or oversold zones • It is simple to interpret • It enables you to easily decide a trend in the stock market • It is a very effective technical indicator in short-term trading, especially for scalping. • Experienced traders mainly find that their performance is greatly enhanced by the conjunction of the RSI indicator tactic and pivot points. • This indicator is constantly also combined with other technical study tools, such as MACD or stochastic. The disadvantages: • The RSI in the stock market is not a miracle solution to continually succeed in the stock market • Like any other technical indicator, it can also offer wrong trading signals. • Less accurate when used in markets with low volatility • In a market with a deep trend, the RSI can remain in the same overbought or oversold area for a long time. • For all the markets in which you want to invest, you need to detect the appropriate RSI setting.
Education
by UnknownUnicorn18500526
25
How To: Combine Technicals & Fundamentals To Find Great StocksWith the markets taking a bit of a battering, I thought I'd show you some more of TradingViews advanced tools to perhaps help you find better quality stocks that might be more resilient to these corrections by combining both Technical Analysis indicators along with some really easy to understand at a glance Fundamental Analysis metrics. In this video I will cover: 1. How to use the TradingView Screener to find good stocks which didn't pull back much or even went up against the overall market pull back. 2. How to use Moving Averages to find stocks with lower volatility that might be better for buy and hold type investors. 3. How to use the TradingView Income Statement summary tool to quickly identify and help shortlist stocks with better overall fundamentals. 4. How to see using the TradingView Post Market data which stocks are already being bought back into AFTER the market has closed. 5. How to flag the ones you like and then save them into a TradingView Watchlist you can then review later. 6. How to save your TradingView Screener set up, and have any new stocks matching your criteria to be automatically emailed to you.
NYSE:ITEducation
by zAngus
86
The Reasons We Follow An Algorithmic-Systematic Approach To All We have been trading and investing in markets for decades since the early 1980s. Experienced and successful traders and market participants tend to remember their losses and mistakes instead of victories. Profits feed the ego; losses are teachers for those who realize that valuable lessons come from adversity instead of triumph. Everyone has an opinion- The only objective measure is the current price The trend is your only friend- News, experts, and all other information are subjective Trading and investing can be stressful A plan and discipline are the building blocks for success You have to be in to win- Drawdowns are a part of any trading or investing system A batting average of .300 is good enough to get a professional baseball player into the Hall of Fame in Cooperstown, New York. Each time a future hall of Famer steps up to the plate, a success rate of below 30% is good enough for infamy. Trading and investing are similar. No one is correct in their market calls all of the time. When approaching any market, there are always three potential outcomes, a profit, a loss, or a breakeven. The success rate of calling a market correctly takes a back seat to other factors. We have seen market participants who have had the foresight to call the market correctly 75% of the time and still wind up losing money. Conversely, a seasoned trader can be right 20% of the time and still make an overall profit. I usually write about specific markets on Trading View, but it is essential to look at the methodology, mindset, and path to growing capital over time this week. We follow an algorithmic-systematic approach to trading and investing. Our models come from decades of experience and the knowledge gained from mistakes that led to losses. We all have the same goal; to make money and grow our capital. The route to achieving the goal is what separates the winners from the losers. Everyone has an opinion- The only objective measure is the current price I am sure we have all heard an “expert” or pundit tell us that the current price of an asset is wrong. They may provide many compelling and convincing reasons, but they are 100% wrong when challenging a price level. An asset price at any moment in time is always the correct price for one objective reason. It is the level where buyers and sellers meet in a transparent environment, the market. The “experts” and pundits take a subjective leap of faith when using the terms expensive or cheap. Too many variables establish a price. The only accurate measure of value is the current price itself. The trend is your only friend- News, experts, and all other information are subjective Prices are snapshots. Trends are the living and breathing extension of price action. Many market participants become junkies, watching each news event, “expert” forecast, and other exogenous events that could push asset prices higher or lower. They make investment or trading decisions based on what they hear and see. The approach is flawed for three significant reasons: Trading off what one sees and hears is stale before it reaches our ears and eyes. Others have seen the news or forecast before us, and some had seen it before it appeared on a medium for all to see. The translation of an event, forecast, or news item is purely subjective as it assumes, we will make a correct analysis. The expression “buy the rumor and sell the news” or the converse runs counter to even the most complete analytical decision-making approach. Finally, reacting to any stimulus involves a primary human response, emotion. Emotions are a trader or investor’s worst enemy. They trigger responses and decisions based on fear and greed, a deadly duo that increases the chances of mistakes, miscalculations, and irrational behavior. A market’s trend is purely objective as it reflects the path of least resistance of a price based on market consensus and sentiment. Prices tend to move to levels on the upside and downside that can defy logic, run counter to reason and are not rational. Trend following blocks out logic, reason, and rational thought and favors one of the leading theories of physics. Newton’s first law states that a body at rest will remain at rest unless an outside force acts on it, and a body in motion at a constant velocity will remain in motion in a straight line unless acted upon by an external force. Trend following embodies Newton’s first law of physics. Asset prices reflect the market’s sentiment, which is the inertia that drives those prices. If Sir Isaac Newton were a modern-day trader or investor, his mantra would be the trend is your only friend as it is compatible with his first law. The physical sciences are objective. Trading and investing can be stressful We have found that decision-making creates stress. When we buy or sell an asset based on anything but the market’s trend, we make a subjective judgment. The attempt to buy at the bottom or sell at the top is a value judgment that runs counter to logic as it implies the sentiment and current prices are incorrect, a fatal flaw. Sometimes some market participants get lucky, but that only reinforces a strategy that leads to future mistakes. Picking tops or bottoms in a market is a strategy that rewards the ego as it gratifies that one called the market correctly. However, ego and vanity lead us down a dangerous path. In the 1997 film, The Devil’s Advocate, Al Pacino, the actor who played Satan, said, “Vanity-definitely my favorite sin.” Reducing stress comes from following the path of least resistance. We use an algorithmic, systematic approach to trading based on models that remain long during a bullish trend and short during a bearish one. We never miss a significant trend as we are constantly long or short the assets in our portfolio. We do not adjust our risk positions on an intra-day basis. We only reverse risk positions based on closing prices at the end of a session and execute the position at the start of the next session. Our proprietary models come from decades of trading and investing experience in a wide range of markets across all asset classes. We never look to sell tops or buy bottoms. We are long at the top and short at the bottom. However, we tend to capture significant trends, taking the filet mignon out of price trends. We have found that our mechanical approach, with a better than even-money win rate, reduces stress as it takes any decision-making out of the equation. The only job is to follow the rules, always remaining in the markets on the long or short side and reversing positions based on the model’s instructions. A plan and discipline are the building blocks for success Emotions lead to impulsive behavior. Acting on impulse leaves little or no time for planning and throws discipline out of the window. Albert Einstein said that the definition of insanity is doing the same thing repeatedly and expecting a different result. Impulsive decision-making is the root of Einstein’s insanity definition. Any risk position in any market must have a plan, which is simply balancing the financial risk versus the potential reward. Before pressing the buy or sell button, we must establish risk parameters for trades or investments when not following an algorithmic approach. The discipline is following the plan. Many market participants run into problems when a risk position goes against them, and they have no plan for risk and reward, or they modify it to allow them to stick with a wrong decision. Turning a short-term trade into a long-term investment is a common mistake. The mistake comes from a subjective call that the market price is incorrect. A way to prevent this is to remind yourself that the market price is always the correct price. We are often wrong; the market is never wrong. You have to be in to win- Drawdowns are a part of any trading or investing system We are constantly long or short the highly liquid assets in our investment portfolio because we never know when a significant trend will begin. Being in a risk position that follows trends is the only way to catch the bulk of a bullish or bearish trend. Drawdowns or losses are a part of life and any trading or investment approach. A choppy market near the high or low end of a trend will result in short-term losses. However, that is the price for capturing the long-term trend. There is no free lunch in life, and the same goes for trading and investing. The goal is always the same for every market participant, to make money over time and build wealth and our nest eggs. The strategy is what separates winners from losers. We take a long-term systematic approach and do not veer from the path. We know that drawdowns are a part of any investment or trading approach. We are in it to win it on a long-term basis. Join us for the Monday Night Call each week - all you have to do is use the link below. There's also a link to sign up for early access to these articles as well. Trading advice given in this communication, if any, is based on information taken from trades and statistical services and other sources that we believe are reliable. The author does not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects the author’s good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice the author provides will result in profitable trades. There is risk of loss in all futures and options trading. Any investment involves substantial risks, including, but not limited to, pricing volatility, inadequate liquidity, and the potential complete loss of principal. This article does not in any way constitute an offer or solicitation of an offer to buy or sell any investment, security, or commodity discussed herein, or any security in any jurisdiction in which such an offer would be unlawful under the securities laws of such jurisdiction.
CME_MINI:ES1!Education
by Andy_Hecht
47
Comparing a strategy with and without Safety OrdersOne important thing when day trading or scalping is risk management . To find the good balance between risk and reward . So I compared the same strategy with and without Safety Orders. Here's an idea explaining how safety orders work if you didn't know: The strategy used for this example is a daily pivot & consolidation breakout. Before I explain the results, a few definitions: Net profit = Gross Profit - Gross Loss. Basically the total profit earned by winning trades minus the losing trades. Percent Profitable = Percentage of winning trades divided by losing trades. I like to call it the winrate. Profit Factor = Profits divided by Losses. It tells how many times your profit is bigger than your loss. A strategy becomes profitable when the profit factor is greater than 1. Max Drawdown = Maximum consecutive losses. AKA, the biggest lose streak. A good indicator of how risky your strategy can be. A last few details: Both strategies have an intial capital of 10 000 €, 0.1% commission on each trade, and each order is a market one, to make sure everything gets filled. █ STRATEGY 1 - Take Profit & Trailing Stop Loss The strategy has a 7% Take profit and a Trailing Stop Loss that starts at 11%. Each order buys with the total capital without compounding (fixed 10k €) With 52 trades closed, the strategy has a profit % of 147 . It suffered a max % drop of 15.5% . The profit factor is of 2.19 . And finally, the winrate is 76.9% █ STRATEGY 2 - Take Profit & Safety Orders + Stop Loss The strategy has a 7% Take profit, 10 Safety Orders, each spaced by a 1% step, and a stop loss at 11%. Now the base order will only buy 100 €, while each safety order will buy 990 €. This is to ensure that the total capital is used and not more. Also note that the take profit is based on total trading volume. As the safety orders get filled, the target drops a bit lower. With 263 trades closed, which is due to the safety orders (5 per trade in average), the profit % drops to 79 . That is almost half of strategy 1. But, the max % drop is divided by more than 2 : only 6.9% ! The profit factor almost doubled , as it is now at 3.8 . Also, the Percent profitable increased to 83.6% . █ CONCLUSION This comparison is just an example. I did this little process over hundreds of strategies and the outcome is always the same: safety orders reduce the risk, even though they also reduce the net profit a bit, the overall profit factor is increased . So should you use them? It is up to you, but my answer is a big yes . Tips on automation: The simplest way to automate this is to place the safety orders using limit orders when the entry alert is received. Then close all deals upon take profit. If you want to use market orders, you'll have to place each safety order as the price drops through the steps. Indicators used in this example have restricted access. See my profile signature for more info. The backtest results for this pair are shown below.
Education
by cyatophilum
25
YOUR SUCCESS IN TRADING | Expectations VS Reality 💰🤔☠️ Hey traders, Being a full-time trader & running a coaching program for the last three years, I met hundreds of struggling traders from different parts of the globe. Guess why the majority of them could not make it? What was the main reason for their bad luck? It wasn't their trading strategy, nor their technical analysis. The source of their failure was the expectations. Trying different trading strategies, following the signals of different signal providers, these traders expected quick gains and exponential account growth. They were actually in a state of a constant search of a holy grail, of a magic wand that will open Pandora's box to them. Just a single losing trade made them skeptical while the first losing streak made them drop the strategy and return back to the search. They keep spending thousands of dollars on trading strategies promising them close to 100% win rate. There is this common mantra, the stereotype about a pro trader: a guy with 4 screens making a quick buck on each and every market rally, driving Lambo, and living in a mansion. Unfortunately, the reality is different. Ahead you will encounter loneliness, losses, pain, and disapproval. The road to success in this game is long and dangerous. Get ready to see the skepticism in the eyes of your relatives and friends. Many years and tons of money must be spent in order to make it. But even mastering the system, becoming a consistently profitable trader you will not constantly beat the market. Your wins will just slightly outperform your losses giving you the means for living. If you are ready for that if you are courageous enough to start and to proceed no matter what, you are already one step ahead of the majority. Be prepared to work hard and practice much, set a correct goal, and sacrifice your presence for the sake of an independent and prosperous future. Are you ready? ❤️Please, support this post with a like and comment!❤️
Education
by VasilyTrader
145
How To Use Financial Ratios To Make Better DecisionsFinancial Ratios help you evaluate a company. Most financial ratios will show you how much money you're paying for a specific piece of the business. Let us give a few examples: Price-to-Sales Ratio = Market Cap / Sales The Price-To-Sales ratio or PS ratio tells you how expensive a company is relative to its total sales. The formula is calculated in two different ways: divide the company's market capitalization by its revenue or divide the current stock price by revenue-per-share. Because this ratio is being calculated with live price information, you can also watch it in real-time on the chart as we've shown in this example above. If a company has a market cap of $10 billion and revenue of $1 billion, well that, that implies a PS ratio of 10. You're paying $10 for every $1 in sales. You can do ratios like this for all aspects of the company. For example, PE ratio or Price-To-Earnings ratio measures the Market Cap / Earnings. This tells you how much you're paying for every dollar of earnings. Keep in mind that Financial Ratios are not perfect. They are also not a buy or sell recommendation. Instead they are shortcuts, ways to quickly evaluate a company, compare its underlying fundamentals, and study that company relative to other companies. You also must remember that financial metrics can change quickly with a single earnings report. A company's future expectations are also just as important. A company like Apple might have a high PE ratio, but if they're building and growing revenue into the future, their PE ratio could come down over time. Remember, Financial Ratios and Financial metrics in general paint a picture of the underlying business and its earnings potential. Here are some other resources to get you started: 1. Read more about Financials on TradingView in our Help Center. 2. You can also code your own strategy or indicator using this financial information . 3. We've also created a library in our Help Center so you can learn more about every Financial metric. Here are some other financial ratios that you may find interesting and how they're calculated: PE Ratio = Market Cap / Earnings PB Ratio = Market Cap / Book PEG Ratio = PE / Earnings Growth Quick Ratio = (Cash + Cash Equivalents + Current Receivables + Short Term Investments) / Current Liabilities Dividend Yield = Dividends Per Share / Price EV Multiple = Enterprise Value / EBITDA To access all of the Financial Ratios available to you, click the Financials button at the top of your chart. From here, you can select many different Financial metrics and study markets at a deeper level. More importantly, you can combine the study of Technical and Fundamental analysis at the same time. Meaning you can evaluate the fundamental side of the business including its earnings and valuation while ALSO studying price action and planning a trade. Please feel free to share your feedback and comments below! Thank you for reading.
NASDAQ:AAPLEducation
by TradingView
14
How To: Build Your Own Private Signals Service Using TradingViewMany traders - especially beginners - rely on others to tell them what stocks to trade and when to place their entries and their exits. What I want to show you is not so much how to trade or what strategy to use, but once you have found a strategy that YOU like, how to set up this strategy in TradingView and get automated alerts when a stock meets your criteria. This video covers: How to setup your TradingView Chart How to add built-in or custom TradingView Indicators to your chart How to customise those indicators How to find stocks that match your criteria using the TradingView Screener How to save your set up How to set up a TradingView Alert How to get alerts sent to your phone or email or screen How to check TradingView News to see what catalyst might have caused the alert How to use TradingView Text Notes Hope the video was useful.
NASDAQ:OCGNEducation
by zAngus
66
Difference between Centralized and Decentralized crypto-exchangeIf you find the analysis useful, please like and share our ideas with the community. Any feedback and suggestions would help in further improving the analysis! One of the USPs of Blockchain technology is ' Decentralization .' It means that no single entity or organization has the power to influence or control the network. Decentralization is rapidly picking pace, with several apps being built on this exact premise. These decentralized apps or ‘ DApps ’ are being built on existing blockchain networks, such as Ethereum, Solana, Polkadot, and so on. With the exponentially rising demand for cryptocurrencies, it was only a matter of time for the crypto exchanges to come sprawling up. Cryptocurrency exchanges can be broadly classified into centralized and decentralized exchanges. What is a centralized exchange? The way a centralized exchange operates can be considered similar to a bank. Depositing cryptos onto a centralized exchange such as Binance essentially means transferring it to a wallet held by the exchange. When we deposit fiat currency such as the US dollar or any other currency to buy crypto, that crypto is also held in the exchange’s centralized wallet. What is a decentralized exchange? With decentralization picking up, the cryptocurrency exchanges want to get into the decentralization space too. These decentralized exchanges are also known as DEX. Currently, there exist more than 35 DEXs globally. One of the most popular ones is Uniswap, which appears to have recently gotten into trouble with the SEC. Other players include Kyber, Bancor, etc. Traders simply swap tokens with each other, and there’s no middlemen involved here. Key points of contention between centralized and decentralized exchanges: Fees: In the case of centralized exchanges, there is a fixed fee which is usually a percentage of the transaction amount. In decentralized exchanges, it works out to be gas fees, which can sometimes vary. Ownership of your crypto holdings: Crypto wallets have two keys, public and private keys. Public keys are shared with anyone who wants to send you cryptocurrency, while a private key is what you use to access your own wallet. Centralized crypto exchanges don't give their users the private key. It essentially means that the holdings are not actually owned by the users, but by the exchanges. In some decentralized exchanges, the entire process of buying and selling is performed ‘on the chain.’ The holdings are with the user and not held by any central agency. However, keeping the holdings on the exchange can lead to a faster execution since the user does not need to provide access. But this can be the reason for the crypto theft as well! Case in point: In 2018, $713 million was stolen with most of them coming from the Coincheck exchange hack. In a Decentralised Exchange, users are generally free from these risks! Privacy: A decentralized exchange script usually does not have a central authority involved. Therefore, no requirement will be imposed on them. One can sign in and start trading without any identity verification. Additionally, Anonymity allows the user to access the tools which are not available otherwise. Centralized exchanges require the users to perform a KYC to trade cryptos. It is not the case with decentralized exchanges. It means that the user would not need to hand over the documents to any single entity. Liquidity: Barring the large centralized exchanges, several others suffer from a lack of liquidity. It is a major concern that ultimately leads to the downfall of the exchanges. The larger exchanges such as Binance, Coinbase, etc. have high liquidity. Decentralized exchanges usually follow a different method of price discovery and don't suffer from problems of illiquidity. Some decentralized exchanges also have Automated Market Makers (AMM). AMMs look to solve the liquidity problem without depending on large traders using smart contracts — self-executing computer programs that ensure liquidity on the exchange. The AMM algorithms have pre-defined requirements for an entity or individual to become a liquidity provider. Anyone who meets these criteria can become part of the liquidity pool, and hence maintain continuous trading. Do give a follow if you liked the content. Keep supporting:) -Mudrex
COINBASE:BTCUSDEducation
by Mudrex
42
A Comprehensive Guide to the Ichimoku CloudHello traders, in this post, we will be talking about how to trade using the Ichimoku Cloud. This is one of the most common, yet very effective and unique indicators to date and is prized by many traders as it foreshadows possible support and resistance levels. ------ What is the Ichimoku Cloud Indicator? The Ichimoku Cloud indicator is an extremely versatile indicator that can help define possible support and resistance levels. It helps identify not only the support and resistance, but also provides data to help identify the overall direction of price, give a good idea on the momentum of price action, and can be used strictly alone as a trading signal - if used properly. Even though the Ichimoku may seem complicated, it is actually rather a very straightforward indicator. The concepts are easy to understand and the signals are well defined. The Ichimoku indicator takes multiple averages and plots them on the chart that uses the figures to compute a 'cloud' which attempts to forecast where the price may find support or resistance in the FUTURE. The keyword here is future. This is one of the few indicators that can actually give you possible support in the future and present time. The Ichimoku has 5 simple components: 1) Conversion Line 2) Base Line 3) Lagging Span 4) Leading Span A (this is what creates the cloud) 5) Leading Span B (this is what creates the cloud) Conversion Line: - On it's own, the conversion line shows the short-term price momentum - The mid-point price over the last 9 periods (which is also the default value) - An area of minor support or resistance The market price above the conversion line shows the possible short-term upward momentum, allowing the trader to focus on buy signals. If the price is below the conversion line, it would signal short-term downward momentum, and just like when it trades above, you would want to find sell signals when it trades below the conversion line. The conversion line is not typically used on its own, but rather used in conjunction with the other components of the Ichimoku as listed above in the 5 components. Base Line: The Base Line shows the support and resistance levels on the medium timeframe. The midpoint of the high and low price is calculated over the last 26 periods within the chart. Just like the conversion line, on its own, can be used to find price momentum. If the price is above the base line, it means it is trading above the 26 period midpoint, and therefore has an upward bias. Vice versa when price is below the base line. Unless there is a very strong trend, the base line will often not be near the price. When the base line is often near or intersecting (crossing) with the price, it isn't helpful to determine the trend direction. Lagging Span: The Lagging Span is created by plotting closing prices 26 periods behind the latest closing price of an instrument. It is designed to allow traders to VISUALIZE the relationship between the current and prior trend, as well as to spot potential trend reversals. One of the key ways to use the Lagging Span is to view its relationship to the current price. When the price is below the lagging span, this is usually an indication that there is a trend within the price and can indicate that it will move higher. When the price is trading below the lagging span line, this is often an indication that there is WEAKNESS within the price. If the lagging span line is about to cross above the prior price line, this can be a confirmation of a bullish signal. If the lagging span line is crossing below the price, this can indicate the opposite, a bearish signal. Any interaction with the past price line is an indication of a choppy or sideways market and if a lagging is descending quickly into a past price line, it could be a sign of exhaustion for price. Kumo Cloud (or Cloud for short): The Kumo Cloud is formed via two lines, the Leading Span A, and the Leading Span B. The Kumo Cloud gives traders support and resistance levels that can be projected into the FUTURE. Not many indicators can give a price projection based on the future. It is very different from many other indicators because it provides support and resistance levels for the current data and time taken into account. Moving averages, for example, only give the present and past data as possible support and resistance, and doesn't give any indication of possible future support or resistances. The uptrend is indicated via a green cloud as shown in the chart above. The uptrend is strengthened when the leading Span A (green cloud line) is rising and is above the Leading Span B (red cloud line). Conversely, a downtrend is produced when the Leading Span A is BELOW the Leading Span B line - which creates the red cloud. As stated above, the Kumo cloud is shifted forward 26 periods that provides future support and/or resistance. If the cloud is THICK = STRONG Support/Resistance If the cloud is THIN = WEAK Support/Resistance If the price is above the cloud, then there is enough of a trend to be in place that provides buying opportunities. If the price is below the cloud, then it's considered to be under selling pressure that can help provide sell signals. The longer the price action stays above or below the cloud, the stronger the trend and the more support/resistance the cloud offers. The Kumo Cloud is suitable for long term traders as well as for trend/momentum traders. When combined with the MACD, for example, which is another momentum indicator, can provide high probability results. The price relationship to the cloud can be defined as when the father the price action is from it, the stronger the trend and more volatile it can be. You want to avoid trading inside of the Kumo Cloud as it usually means that the market is indecisive. Settings for the Ichimoku: The Ichimoku relies on only three different time periods in the calculation: 9, 26, and 52. The reason is because the Japanese markets used to be open for six days of the week, meaning that the number 9 represented a week and a half of trading. 26 equals the number of trading days in a typical month (30 minus four Sundays), and 52 equals two months of trading days. Japanese markets now only trade 5 periods per week - so some practitioners of the Ichimoku suggest revising the settings to: 7, 22, and 44. In my personal experience, however, the traditional values of 9, 26, and 52, have performed far better. Limitations: The Ichimoku, of course, does have its limitations. The indicator can make the chart look incredibly busy with all of the lines. To help remedy this, depending on your trading needs, certain lines can be removed. It can actually be helpful to remove the lines, and keep only the cloud. In conclusion, just focus on which lines provide the most information for you as a trader, and then consider hiding the rest of the lines as they can be often distracting. The cloud limitations can also become irrelevant for long periods of time, as the price remains way above or below it, At times like these, the conversion line, base line and their crossovers, can then, also, become more of an importance as they generally stick closer to the price. Here is an example of when we remove all of the lines, only keeping the cloud and the leading spans:
BITSTAMP:BTCUSDEducation
by XForceGlobal
171
Education Excerpt: Simple Moving AverageSimple Moving Average The origin of inventing the Simple Moving Average (MA) is not clear. Although, some of the first documented cases of its use date as far back as the early 20th century. Implementation of moving averages in technical analysis is one of the most successful methods of identifying trends. Moving averages are simply constant period averages - usually of prices, that are calculated for each successive period interval. The result of calculation is then plotted on the chart as a smooth line that represents successive average prices. Thus, the calculation of the moving average dampens fluctuations of price of an asset, making it easier to spot an underlying trend. Though use of the moving average goes beyond identifying trends. Support, resistance and price extremes can be anticipated by correct interpretation of the moving average. Crossover Generally, when the moving average with a lower period interval crosses above the moving average with a higher period interval it is considered a bullish signal. On the other hand, when the moving average with a longer period interval crosses above the moving average with a lower period interval it is considered a bearish signal. These crossovers can serve as specific buy and sell signals in markets that are trending. However, moving average crossovers tend to produce many false signals in non-trending markets. Furthermore, these same crossovers can act as support or resistance levels. Illustration 1.01 Picture above depicts daily graph of PepsiCo (Ticker:PEP) with 20-day SMA (blue) and 35-day SMA (red). With implementation of these two moving averages it is easily observable that prevailing trend is bullish. Crossovers between these two simple moving averages reveal where trend began (10th February 2017) and where it ended (7th July 2017). In addition to that analyst can identify price extremes when price deviates too far from its 20-day SMA. Length of the period Different lengths of moving average directly translate to the amount of data used in the calculation. Including more data in the calculation of the moving average makes each data per time interval relatively less important. Therefore, a large change in one particular data would not have as large an impact on the overall result of the calculation in comparison to if the moving average with a shorter period was employed. Hence, the longer moving average produces less false signals at the cost of revealing underlying trend sooner rather than later. Usually, the use of two moving averages with different period intervals is encouraged as opposed to use of a single moving average. This comes from the premise that when two moving averages with different period intervals are plotted on a chart, they tend to show two separate lines converging and diverging. Illustration 1.02 Picture above depicts daily graph of XAUUSD with 3-day SMA (blue) and 6-day SMA (red). Viewer can see that 3-day SMA copies price move more agressively than 6-day SMA. Illustration 1.03 Picture above depicts exactly same graph as is showed in Illustration 1.02. However, length of SMAs differs. Blue line represents 10-day SMA while red line represents 20-day SMA. It is clear that when length of SMAs was extended then SMAs produced less mechanical signals (crossovers) as opposed to SMAs used in Illustration 1.02. Calculation The calculation of the moving average usually involves use of the close price. Normally, 10, 20, 50, 100 or 200 periods are used and the calculation is conducted by creating the arithmetic mean of a dataset. SMA = (A1 + A2 + An) : n A = average in period n n = number of time periods Illustration 1.04 Picture above shows daily graph of Coca Cola (Ticker:KO). In this particular example trend was neutral and it is visible that crossovers between two simple averages produced many false signals. Disclaimer: This content is just excerpt from full paper that will be published later. It serves educational purpose only.
OANDA:XAUUSDEducation
by Tradersweekly
60
DAY TRADING RULES THAT WORKDAY TRADING RULES & TIPS THAT WORK DAY TRADING RULES BEFORE YOU EVEN START 1. DAY TRADING IS NOT A FORM OF INVESTMENT. Day trading is not a form of investment. It is not part of the stock/bond portfolio that you have for retirement. Day trading is a risky business, and you stand to lose everything if you fail. You must accept this fact before you start day trading. 2. DAY TRADING IS NOT GAMBLING. On the other hand, day trading is not a form of gambling. If you are not going to take it seriously and put in hard work, do not even start. The first two rules seek to adjust your attitude towards day trading. Once you start with the right mentality, these “rules” are already with you. 3. HAVE A DAY TRADING PLAN FOR EVERYTHING And I mean everything. Imagine all the contingencies and plan for them. Plan even for what you are leaving unplanned, which means planning when to use your discretion. Some essential aspects include: Where to trade When to trade What instruments to trade What is your trading strategy and how to execute it How much to risk per trade Broker, internet, computer, and what happens when they fail to work The trading plan is a work-in-progress. Keep refining it and add to it. 4. SIT ON YOUR HANDS FOR THE FIRST 15 MINUTES OF THE TRADING SESSION The first 15 minutes are usually very volatile, without much price action available for analysis. So sit on your hands for the first quarter of the hour and observe the market tone. If you want to consider a trade right after the 15 minutes, take a look at the opening range scalp trading strategy. 5. REVIEW YOUR TRADES AFTER EACH SESSION. After each session, there is a learning opportunity. Each trade contributes to a feedback cycle that can improve our trading performance. THE ACTUAL DAY TRADING RULES 6. USE STOP-LOSS ORDERS Every trade must have a stop-loss order. We must always know how much we stand to lose. If you disagree, I want you to reconsider. 7. USE LIMIT ORDERS OR TRAILING STOP LOSS FOR TAKING PROFITS We close our trades before the session ends, so the profit potential is smaller. Hence, we should have our limit orders/ trailing stop losses in place to grab our profits and run. Waiting for the bull run of the century is not for day traders. 8. TAKE ONLY THE BEST TRADES Be very selective about the trades you take. 9. ALWAYS BE IN CONTROL OF YOURSELF. DO NOT CHASE THE MARKET. If the market has taken off without you, do not chase it. The market behaves in ways nobody can control. You cannot control the market. But you can control your response to the market. Always be in the zone. 10. WHEN IN DOUBT, LOWER YOUR TRADE SIZE Lower your trade size when you are in doubt of your trading edge. This tactic is for damage control. Ideally, cut your trade size to nothingness until you figure out your trading edge. 11. ACCEPT LOSING DAYS WHEN DAY TRADING Somehow, day traders expect to end each day with profits. But trading is a game of probabilities, so you’ll have losing days. Accept them and move on. If you refuse to accept losing days, you will do irrational decisions like overtrading and ruin your trading account pretty soon.
BITSTAMP:BTCUSDEducation
by MoonBets
77
Automating strategies keeps me sane 😊Running a strategy with a proven edge has me comfortable mentally on how a trade plays out, Be it a stop out or a take profit target met. Also automating those proven strategies and just letting them be helped with my mental state as a trader. Trade alerted 17:45 this afternoon and has been close once to TP. I didn't know this I was in the garden enjoying the late summer sun that has bestowed the UK this week 🌞 Once upon a time watching the charts would of had me thinking of closing to soon and then filling with regret as the retrace occurs that I didn't close. Only reason to look at chart tonight was a quick mid week review of trades and this trade is one of my open ones. Trade details are shown on the chart. We are working the 15M time frame on this strategy. We're looking for the green line which is take profit target. Little red arrow is entry point and purple line is stop loss. The current open trade still might not hip TP but I'm not allowing emotions to play a part I let the objective based plan play out. Previous trades shown on chart from the last two days. Trade history can be seen at the foot of this trade idea too for full transparency. These are year to date stats. How do you as traders journal your trades I'm intrigued to know? Having back test capability and a trade log which is possible through TradingView pine script saves me hours in manually logging trades as well as manually back testing. Having that level of data allows me to know I'm running a proven strategy and that I have an edge. The next key bit to staying sane/stress free and one of the best pieces of advice I could give as a trader is use technology available to your advantage. Trading shouldn't consume every spare minute. Most of us do this to escape the 9-5 so don't spend hours at charts unnecessarily. Not spending hours at charts is why I haven't shared all these trades on this pair and when this current one alerted. If your reading this tonight let this sink in I've only looked at this chart once this week when I shared my last idea yesterday on the pair in question. There has been three trades since then and I'm only just looking now! Take it from me find a strategy that works and then automate that strategy. Your mental health and well being will be the winner in the long run along with healthy account gains. ------------------------------------------ I try and share as many ideas as I can as and when I have time. My trades are automated so I am not sat in front of a screen daily. Jumping on random trade ideas 'willy-nilly' on Trading View trying to find that one trade that you can retire from is not a sustainable way to trade. You might get lucky, but it will always end one way. ------------------------------------------ Please hit the 👍 LIKE button if you like my ideas🙏 Also follow my profile, then you will receive a notification whenever I post a trading idea - so you don't miss them. 🙌 No one likes missing out, do they? Also, see my 'related ideas' below to see more just like this. The stats for this pair are shown below too. Thank you. Darren
Education
by pow_removetheguesswork
73
Your Strength Meter For Candlestick | Best Momentum Indicator 🕯 Hey traders, There are multiple different ways to measure the strength of the market reversal from a key level: ✔️some traders apply volumes and look for its sudden spike as a confirmation, ✔️some traders rely on some indicators and look for a particular trigger there as the signal, ✔️some traders, like me, follow the candlesticks and make their judgments based on the candle's strength. In this article, I prepared for you a candlestick strength meter that will help you to accurately spot the reversal clues. ❗️Remember about the important precondition: that candlestick meter is reliable being applied ONLY on key levels. Trading that outside key levels is not recommendable. 📈The initial touch of a key level is very telling: after a sharp bullish/bearish rally to key resistance/support the reaction of the price on that can indicate you the strength of the identified level. There are three main classifications of the reversal candle momentum: *by reversal candle we mean the first bullish candle on key support or the first bearish candle on key resistance. 1️⃣The momentum will be considered to be low in case if the reversal candle will close within the range of the previous candle. It indicates the weakness of bulls buying from support / bears selling from resistance. You should patiently WAIT for some other signal before you open the trade. 2️⃣The momentum will be considered to be medium in case if the reversal candle will engulf the range of the previous candle. It shows quite a strong initial reaction being sufficient to open the trade ONLY in a strict combination with some other signal. 3️⃣The momentum will be considered to be high in case if the reversal candle engulfs the range of the last two candles (two bearish or two bullish). By itself, it is considered to be a strong reversal signal. The trading position can be opened just based on such a candle. Among the dozens of different candlestick pattern formations, I believe that momentum candles are one of the most reliable in spotting the market reversal. Learn to spot these candles and you will be surprised how accurate they are. What candlestick pattern formations do you want to learn in the next post?🤓 ❤️Please, support my work with like and comment!❤️
Education
by VasilyTrader
117
The logic of "sell half keep half" (Forex)Both holding & not holding don't make sense. Definitions: - Holding = try to hit "homeruns" every time - Not holding = snatching profits at target (not before, that's just being a huge noob) Assume winners 5 times bigger than losers on average: 5R. And the winrate is of 20%. So that's a PF of 1.25, all good. To keep it simple there is no trailing until target. Risking 0.5% per trade you'll never be down more than 10%. Once at target if you move the stop to 1R (-4), 12% of the time the price will go to 45R. So risk 4 to make 40, or 1 to make 10. With a winrate of 12%. PF = 1.36. But if you do hold and trail well... 12% of 20% is 2.4% of total. 80% will be losers (-1R), 17.6% will be +1R, and only 2.4% will be (huge) winners. In other words: Risking 0.5% per trade, by the time you get that big winner (+22.5%) you will be down 15, 25, maybe 50% on a bad luck streak, or more. 22.5% is just enough to get to breakeven after an 18% drawdown. Compared to just lose 4 times (down to 98%) then win once 2.5% (up to 100.45%) Even after a 10% drawdown (an unlucky >20 losses in a row) get a few 5R's and you quickly get back to zero. Holding just makes little sense, and there is no margin for error. But at the same time it's stupid to ignore these big wins. So here is the solution: Sell half, keep half. (Or any other fraction). Selling half at target allows to smooth the returns. If they are too volatile it just won't work out. And keeping half first with a wide stop then maybe not as much, allows to catch the "big ones". This makes most sense even if "on paper" some will say "oh well you should go for the big ones if the odds are in your favor" lol sorry but it's a bit more complicated than this. More generally with Forex I think that any risk to reward under 1 to 2 is bad as is anything above 1 to 10. Can aim for the moon, but not all the time. The "sell half keep half" concept is the best compromise. Adding to winner at some point is too dangerous, it doesn't work, it's just greed. Adding to winners is another subject entirely and anyway there is nothing as a "just do this". It all must be researched and well thought. With this sell half concept you're securing 2.5 + 1.25 = 3.75 / 5R so that's 75% of the profit. Then risking 25% of profit to catch some of these massive winners is I think the smart move here. Profit is secured, to push this a bit further you might have thought of this already: secure enough profit to breakeven (on 20% winrate secure 4/5 R) and "go double or nothing" on the extra (1R). So it's as if in a way these big winners are "free". Risking 1R with 50% retracement means you're leaving 2R in or 2/5 = 40%. Pretty good. And then the account I showed turns to this: Isn't this the best? Sure you'll "only" be in the huge wins with maybe 1/3 of the normal size but it's how it is. This is not gambling. Really, there is no other choice in my opinion. Sort of go nowhere for a while, then boom get a big winner, account jumps up, then go nowhere for a while, etc. The risk all "double or nothing" is actually stupid even if "on paper" you are risking less than you stand to make. And constantly closing at target is just bad and leaving some profit on the table. This does not apply to stocks (sometimes it does, probably). To be honest with stocks you're better off holding everything and getting these zigzags and all so you always have (balanced out) losses ready to be declared, and the huge winners never ever getting closed.
Education
by MrRenev
17
Without this, you will not become a profitable trader Yes, this is risk management. Without proper risk management, your trading strategy based on levels, indicators, patterns, etc.will not make any sense. Any trading strategy should be supported by strict risk management, where the maximum allowable losses per transaction and the risk ratio are observed:the profit is always more than 1/2. You don't have to be right in every trade. It's just that your profit in successful transactions should be greater than the losses in unprofitable transactions. This correct use of risk management will lead you to success. ____________ The example shows one of the real scenarios of any trading system where the rules of risk management are observed: Deposit of 10,000$ The risk per transaction is -1% (or -100$) Total trades: 4 profitable trades = +14% 10 losing trades = -10% Total: +4% (or + 400$) Even though only 30% of the total number of profitable transactions, we still have a profitable result. Learn risk management and become a consistently profitable trader. ❤️ Please, support our work with like & comment! ❤️
OANDA:XAUUSDEducation
by UnitedSignals
128
Education excerpt: Relative Strength IndexGeneral information The Relative Strength Index (RSI) is a momentum oscillator that was introduced by J. Welles Wilder in an article published in Commodities magazine in June 1978. The Relative Strength Index measures the velocity of directional price movement and is commonly used in conjunction with a daily bar chart. However, it can be utilized on a bar chart with any particular time frame. The concept of this oscillator is based upon an idea of an asset being oversold or overbought. Generally, tops and bottoms are indicated when the RSI goes above 70 or drops below 30. Although, failure swings above 70 or below 30 can imply possible market reversal. Similarly, divergence between the RSI and price action on the chart can signal a market turning point. Chart formations and support and resistance often show up graphically on the RSI despite the fact that they may not be apparent on the bar chart. The slope of the momentum oscillator is directly proportional to the velocity of the move. Thus, the distance traveled up or down by the RSI is proportional to the magnitude of the move. The horizontal axis represents time and the vertical axis represents distance traveled by the indicator. The RSI moves slowly when the market continues its directional movement. However, once price is at the market turning point, RSI tends to move faster. Here is depiction of the weekly chart of USOIL: It is clearly observable that peak in RSI often coincides with peak in the price. Similarly, trough in RSI is often accompanied by trough in the price. Calculation The Relative Strength Index is commonly calculated using the close price of a 14 day period. The equation for its calculation involves several components. These are: • Average up closes • Average down closes • Relative strength Relative Strength (RS) = (average of 14 day's closes up/average of 14 day's closes down) Relative Strength Index (RSI) = 100 – Calculation begins with obtaining the sum of the up closes for the previous 14 days. This sum is then divided by the number of days used in calculating the generating figure for average up closes. Similarly, the sum of the down closes for the previous 14 days is divided by the number of days used in calculating the generating figure for average down closes. After these two operations are conducted, the average up days are divided by the average down days resulting in the value of the Relative Strength (RS). The number 1 is then added to the value of RS. Next, 100 is divided by the new amount of RS. The resulting figure is subsequently subtracted by 100 generating the value of the Relative Strength Index (RSI). From this step on, the previous value of average up closes and average down closes can be used to generate the next value of the RSI. In order to calculate the next average up close, the previous value of average up closes is multiplied by 13 and the present day average up close is added to this figure. This value is then divided by 14 generating the value for the new average up closes. In similar fashion, the new average down close is calculated by multiplying the previous average down closes by 13. Today's down close is then added to the figure. The resulting figure is again divided by 14 to generate the new average down close. After that, the same steps indicated to calculate the initial RSI need to be followed. Here is depiction of the monthly chart of copper futures market: Similarly like in the previous example positive correlation between peaks and troughs in RSI and price is observable. Divergence When trend is prevalent and two indexes (or index and price) are going simultaneously either up or down they exhibit positive correlation. However, when this correlation breaks and one index (or price) keeps going up while another index reverses down divergence is said to occur. Technical analyst should pay attention to this instance as it sometimes has abillity to foreshadow upcoming reversal in trend. Though, there are many instances when divergence occurs and reversal in price trend fails to materialize. For this reason some analysts like to implement concept of double divergence. Here is example of the divergence that we mentioned in our idea on 30th June 2021: Double divergence There are many instances when price continues its rise and analyst can observe oscillator or idex to fall only to see it later climb back up in tandem with price. (same applies to the opposite situation when price falls and index or oscillator starts to rise) The divergence occured but price trend remained intact. Because the divergence can be misleading, some analysts preffer to wait for the second divergence before placing their entries or exits. Disclaimer: This content serves only educational purpose.
OANDA:XAUUSDEducation
by Tradersweekly
43