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Trading Psychology

How to analyze the market from scratch (Impulse & Correction)Hello everyone: Many have asked me about demonstrating how to analyze the chart from complete scratch. When looking at my chart and educational video, it all seems very simple, but many are telling me they are struggling to identify the market. Today I will go over how I analyze the chart, from the Higher time frame down to lower time frame by using multi-time frame analysis, top down approach. Specifically by identifying price action, impulse and correction phases of the market. 1. Start from the Higher Time Frame (HTF): HTF can be any time frame higher than the daily chart, such as monthly, weekly, daily. Personally I like to use daily as a go to time frame as it is widely used by traders. 2. Identify the impulse phase of the market. Understand the impulse phase is a period of fast momentum, price is either pushing up or down very aggressively, and not much consolidation visible on the HTF. 3. Identify a period of consolidations. Using trendlines, connect the swing highs and lows of the price. This is to identify the correction/consolidation phase of the market. Which is the most important aspect in price action analysis. You will need to be very knowledgeable on the type of continuation, reversal correction patterns/structures the market usually will form. (I will share many price action patterns/structures that I identify and use in the market below) 4. Once you identify the HTF phase of the market, you will then go down to the Lower time frames (LTF). LTF can be anything under 2/1 HR, 30/15 Min charts. It's not a specific time frame, rather “Multi time frame analysis”. You will also identify the impulse phases & Correction phases on the LTF and use trendlines to connect the swing highs and lows of the correction/consolidation phase, just like what we did on the HTF. 5. Now that you have both the HTF and LTF charts drawn out, the key here is to have both the HTF and LTF tell you the same direction/bias. They should align up and have the same bullish/bearish bias. This will strengthen your probability of success. I always make sure when I am about to enter any trades, I want the multi-time frames all telling me the same story. Same bias, same direction. 6. Now all that comes down to is forecasting the possible entries, which I have made many videos on this topic and I will share some below. Understand you would always want to make sure you are either entering during the impulse phase on the LTF, or the price is about to start the impulse phase to gain the upper hands in the market. You do not want to enter when the price is in a consolidation which is why many traders end up losing money, stuck in the correction and price isn't moving too much, rather just sideways. 7. Continue to work on analyzing the chart from scratch, get comfortable at identifying the impulse phase in the market, and do backtesting continuously so you identify the corrections in the market. This will make you see the chart and the market completely different than before, and you will have a much better probability of entering trades that work out in your favour. Any questions, comments or feedback welcome to let me know. Jojo Below I will share many educational videos that will help you to understand more on price action analysis, impulse/correction phase, entry, forecasting, backtesting and more. Continuation and Reversal Correction Identify a correction for the next impulse move in price action analysis Multi-time frame analysis Continuation Bull/Bear Flag Parallel Channel (Horizontal, Ascending, Descending) Reversal Ascending/Descending Channel Reversal Rising/Falling Wedge Reversal Double Top/Bottom Reversal Head & Shoulder Pattern Reversal “M” and “W” style pattern Reversal Impulse Price Action Continuation/Reversal Expanding Structure/Pattern Risk Management: 3 different entries on how to enter the impulsive phrase of price action Risk Management: How to Enter and set SL and TP for an impulse move in the market Risk Management: When/How to move SL to BE and to profit in a running trade ? How forecasting can benefit your trading journey Backtesting & Chartwork on Forex Market Backtesting & Chartwork on Indices Market Backtesting & Chartwork on Crypto Market How & Why I backtest:
OANDA:XAUUSDEducation
by jojofang0901
40
Are you revenge trading 😖🤔Revenge trading! It all catches us all out at some point in our trading journey's. The markets don't care about your loss and neither should you! Losses are a part of trading and have to be accepted. No one can be right 100% of the time regardless of method used. Revenge trading will add to those losses and compound that account draw down even more. Irrational emotions have no place in trading and they are what lead to revenge trading. The way to eradicate this issue is by going about your trading a logical manner. First off is build or use a strategy with a known proven edge. Second is follow that strategy to the letter and only enter trades when all your parameters/confluences are met. The markets take from the impatient and give to the patient ones. The example I am using on chart is using a trend following strategy of our own. This strategy is a good win percentage and I know that as the built in strategy tester shows me all the stats. As always the report box is at the bottom of the idea showing those very stats. A 61% win rate means losers still happen and as you will see on the chart the buy trade hit stop loss before price went on an upward trend. The old trader in me would of been pouring over this chart trying to guess which way will it go? What should I do enter a long again? That would of paid of in this instance but not the logical thing to have done it would of been luck and luck only. Who knows with emotions at play would I of had a thought the price was going to head down? Then place a sell order? Luckily I didn't have to make any of those choices with emotions at play. I accepted the loss on the fact I know I'm trading a proven strategy and I simply waited for the next trade alert and let probability play out. The next trade was a short that found it's intended take profit target. This process is more simpler for those who are using a mechanical trading system like the one on chart. But regardless of system or approach in use if you are following the trading plan to the letter revenge trading shouldn't occur. Find an edge, apply that edge, stick to the proven plan and revenge trading won't be your issue. Instead you'll be one of the patient ones that the market is giving to 👌👍 ------------------------------------------ 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
Managing Negative Emotions - Psychology of Winning TradersHi Traders. When it comes to trading, psychology is often the biggest pieces among strategy and risk management. In this workshop, I will be breaking down 3 of the most common emotional issues happening on most retail traders. To becoming a consistently profitable trader, it's never about eliminating emotions. Emotions are biological not psychological, it exists within our body system, which cannot be removed completely. But what you can do is to condition your mind to organize its performance, and reduce emotions to the least possible. If you enjoy the content, make sure you follow my profile and give me a thumbs up for daily fx forecast & educational content. Trade safe and take care.
KRAKEN:BTCUSDEducation
by TraderNeoh
2
Leave Your Ego At The DoorAl Pacino played John Milton in the 1997 film the Devil’s Advocate. Milton ran a hugely successful law firm as a front. The fictional character was really the devil. The final line of the movie is, “Vanity is definitely my favorite sin.” Vanity is excessive pride in or admiration of one’s own abilities, appearance, or achievements. There is a fine line between vanity and ego. Ego is a person’s sense of self-esteem or self-importance. Vanity may be the devil’s favorite sin, but ego can be a trader or investor’s worst nightmare. Ego gets in the way of rational, logical, and reasonable conclusions because fear and greed can tug on our egos and cause us to make mistakes that are sins when growing our nest eggs. The quest to buy at the low- Ego leads us to state the market is wrong Looking to sell at the “high”- A recipe for disaster Following trends requires no ego at all Suppressing emotions is harder than you think Never listen to that voice on your shoulder- It leads you to make mistakes The quest to buy at the low- Ego leads us to state the market is wrong Human nature is a powerful force, but it deludes us to believe our gut instincts. When the price of an asset falls to a level where an investor or trader believes is a logical, reasonable, and rational low, they perceive the price as a bargain. After an initial purchase, if the price continues to fall, our emotions cause a dangerous impulse. The little voice in our heads declares that the market is wrong. The market price is never the wrong price. It is the level where buyers and sellers meet in a transparent environment, the marketplace. All of the fundamental analysis in the world can go out of the window when sellers overwhelm buyers. A perfect example occurred on April 20, 2020, in the crude oil futures arena. Who wouldn’t want to buy crude oil at zero? After all, what is the risk? Well, there turned out to be plenty of risk for those who purchased the nearby NYMEX crude oil futures on April 20, 2020, at zero, negative $10, negative $20, and even negative $30. Those with long positions on the expiring contract who could not store the energy commodity learned an expensive lesson. As the chart shows, a purchase of the expiring futures contract at zero looked more than ugly at negative $40.32 per barrel, the April 20, 2020 low. The oil example is dramatic. However, it is a reminder that the quest to buy the low in any market has everything to do with ego and little to do with making a profit. Looking to sell at the “high”- A recipe for disaster It is easier for most investors and traders to rationalize a long position as they assess the total risk from the current price level to zero. Oil was an exception to that assumption. Meanwhile, shorting an asset has the same ego dynamics. Bull and bear markets can take prices to levels on the up and downside that defy logic, reason, and rational analysis. There are many instances where prices rise to levels that make no sense. The lumber market in May 2021 is the perfect example. The annual chart of the illiquid lumber futures market shows the wood price never traded over the 1993 $493.50 per 1,000 board feet level before 2017. After falling to a low of $251.50 in early 2020 as the global pandemic gripped markets across all asset classes, the price took off on the upside. At $660 in August 2020, it reached a new record high. At $1,000 in September 2020, the price was irrational, and it more than halved in value, reaching a low of just over $490 in October 2020. In May 2021, the price exploded to $1711.20 per 1,000 board feet before collapsing. Lumber is a dramatic example, but it reflects the potential for the ego to trigger impulses that lead traders and investors to financial ruin. Selling short at $1000 the second time up and ignoring the power of the trend was disastrous. Just because a market price rises to a high, does not mean it cannot go higher a lot higher. Following trends requires no ego at all Following trends requires a special skill, which is no skill at all. Following trends allows us to go with the flow, ignore expert advice, the news, and any other exogenous forces. The only tool necessary is a simple chart that displays the path of least resistance of the price. And, it does not matter what the asset is; it can be a stock, a commodity, a currency, a bond, or any other product with liquidity that allows for effective execution of buy and sell orders. Following trends allow the markets to work for us instead of us slaving for the market. The process is entirely objective, while fundamental analysis is completely subjective. So many variables determine the path of least resistance of market prices, making it impossible to legislate for all potential outcomes. Experts may make a compelling case for buying or selling an asset, but they do not have a monopoly on the truth or offer any guaranty. James Surowiecki wrote The Wisdom of Crowds in 2004, arguing that the many are smarter than the few and how collective wisdom shapes business, economies, societies, and nations. A price chart is the roadmap of the crowd’s wisdom. Suppressing emotions is harder than you think Tucking away your ego takes practice. Understanding that ego triggers the emotions that lead to pushing the buy or sell button is the first step. Many investors wind up selling the lows and buying the highs in wild markets because they allow fear and greed to guide their behavior. Wild markets are the exception, not the norm. Training yourself to manage your ego objectively will reduce the odds of allowing it to destroy you when the you know what hits the fan in markets. Eliminating ego from all investment and trading decisions starts with ignoring the news, experts, and any inputs other than the herd behavior in markets. Since prices rise or fall to levels that many believe are not sustainable, following trends allows you to take advantage of their mistakes. Make a conscious decision that you will end the quest to pick a high or low in any market is a great place to start. Successful trend following will cause you to be long at the high and short at the low, but that is OK. It will also allow you to take the most significant percentage from a market move when trends emerge. Moreover, following trends is an automatic exercise that reduces stress. Never listen to that voice on your shoulder- It leads you to make mistakes Eliminate any thoughts about picking lows or highs. When I first began trading in the early 1980s, a colleague in London offered sage advice, saying, “Andy, when you look to pick a bottom, all you will wind up with is a dirty finger.” Ignore those voices in your head that appeal to your ego, trigger fear and greed, and lead you down a losing path. Never forget that your view has no relevance whatsoever. Vanity is definitely the devil’s favorite sin. Ego and vanity are dangerous. Follow those trends. Approach markets with a clear risk-reward plan where the rewards are equal to or greater than the capital at risk. Understand that you will be wrong all the time, but the market will never be wrong. The most successful traders do not make money on all of their trades or investment positions. Many will tell you that losers far outnumber winners. However, success depends on catching that wave or substantial trend that yields the most significant profits. Leave your ego at the door; it is your worst enemy, while the trend or the market’s wisdom is your only friend in the pursuit of profits. Use the link below to register for the Monday Night Strategy Call. You can also sign up for free using the other link to gain access to full articles. 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.
LEducation
by Andy_Hecht
31
Mastering One Strategy Dear traders, My name is KeySlot and I have been trading in the forex markets for over five years now and have gone threw a lot to get to the point I am at now. I have gone threw pretty much all of the common beginner mistakes from risking too much on a single trade, wanting to become a millionaire in one trade, or becoming too cocky and thinking that I am unstoppable have all been some of my downfalls in my journey and probably something that many of you are way too familiar with. Today I am going to be going over one of these major problems and will be going over more in the near future. I hope you get something out of me sharing my experience and problems I have gone through. Jumping from strategy to strategy: When starting off in the trading game everyone will go to Youtube and look up "best forex strategy" click on that video and try to copy their strategy. While sometimes you might get lucky and find a really good system there are a lot of systems that will work for one person but may not work for another. This does not mean that it is a bad strategy but it just might not be your style of trading, this is why I say everyone is different. Some people will be willing to risk a lot more money than some other people will want to do, some people will want to spend more time in a trade than others, and some people will want to trade other pairs than one another. This is why I fell in love with trading, every single person can see a pair a different way and approach that market a certain way, every one can be different for once. When I first started trading I also did the same thing, I went to Youtube and searched for a strategy and probably went through two or three different ways of approaching the market a week. After a few weeks of switching back and forth between strategies I realized that all of these indicators are not really doing anything for me, I thought that when they told me to buy price HAD to go up no matter what. But I quickly realized that this is not the case, indicators are lagging and cannot tell the price of the future or we would all be filthy rich. When I understood this concept that indicators could be actually hurting me more than helping me I ditched them completely, this is when I started to study the concept of Price Action. When I switched to price action the market just seemed so much clearer to me and a light bulb seemed to click suddenly in my head. But then I doubted my self again, I took a few trades using solely price action and they were all losing trades, guess what I did? I went right back to using the indicators that eventually lead to another losing streak. No matter what I had done I was always taking losing trades, it seemed like the market was out to get me and only me. After around a year and a half of trading I had finally gone back to price action and told myself this is something that I need to master. I wanted to learn how to read the market like a book and was ready to do anything to do so. It was only until I devoted all my time into learning this one continuation strategy using price action where I started to become a break even and eventually a profitable trader. I started to see the same setup over and over again but I learned what made my setup one I would take versus one I would not. This is where it became very useful taking a deep dive into one singular strategy, overtime I saw my setup time and time again but I began to notice that sometimes when my setup had formed there would be small details that would stick out to me after seeing it so many times. After doing a good amount of trades I was really able to pick out the really big winners and started to cut out the losers. I noticed that some pair just seemed to not work on certain pairs and this is when I started to narrow down my list. Becoming an expert in one list of pairs and one strategy allowed for me to become a more profitable trader by mastering a single strategy and being able to pick out a good trade with a higher probability and allowed for me to avoid getting into any losing trades as well. While it might sound stupid or too good to be true, focus on one strategy and a set list of pairs and only those things for one month and tell me if your results have improved. Another very important thing when starting out is keeping a trade journal, I will go more in detail on a journal in the upcoming week. I hope all of you have an amazing trading week. Thanks again, Keyslot
Education
by KeySlot
What Are 10 Things You See On Daily September Chart? Add YoursExamples: Do this on daily charts- understanding candlestick language will assist you in trading and risk management. 1) Supply Zone/Resistance area 2) Demand Zone/Support area 3) Trends- bearish or bullish 4) Price Action? Top to bottom how many pips? 5) Any Engulfing Candlestick patterns? 6) Any Harami Candlestick patterns? 7) Any Pinbar Candlestick patterns? 8) And Doji's (undecided) candlesticks? 9) From 1st day to last day of September- was it bearish? was it bullish? or doji (monthly candlestick?) 10) Where are critical price line levels (round numbers or psychological numbers) 11) ADD YOURS... PLEASE ADD IN COMMENTS: What do you see on attached naked or price action only chart of AUDJPY- thanks!!! Where and How could you have entered into a trade on this chart, with enter, stops and targets set up and make a profit?
Education
by Anbat
1
Statistical Coincidence Analyzer for TradingView membersWe regularly analyze the ideas of a particular TradingView participant to find out the degree of overall coincidence of the real price movement with the forecast. Very often, those who share ideas have a very high rating and a lot of likes, but in general, the real price movement did not coincide at all with the forecast. It's time to show in the participant's profile the overall percentage of coincidences of the forecast with the real price movement, which is more important than the rating level and the number of likes. Please support the idea of launching such an analyzer if you agree.
FX:XAUUSDEducation
by UnknownUnicorn4430035
16
Why Do Traders Fail?Most of the novice traders believe that trading FOREX is a gamble! Why do traders fail? 1) They trade with the aim of getting luck to make money. 2) Their greed exceeds their need. 3) They think trading is a game of chance and luck and do not get the proper education to succeed. 4) They do not favor to invest enough time and amount for education and mentor-ship to get basic knowledge. 5) They have poor focus. 6) They are more emotional than intellectual. 7) After failing, they want to make up their loss; therefore they may further incur loss.
Education
by Anbat
2
The biggest “MYTH vs REALITY” in tradingDear traders, happy Friday and welcome on our Educational Post for this week. Today we will be talking about the most popular myths in the trading world and compare it to the reality. “99.99% win rate”, “50 trades winning streak”, “100% monthly return”. Do these phrases sound familiar? All of us have come across people and companies promising that they accomplish the above stated proclamations GUARANTEED. These individuals tend to deceive the beginners and sell them a fake dream. However, trading does not work like that. If we take a look at the chart, we can see the 4H timeframe graphic of GOLD. We decided to use this graph to illustrate the idea. On the left hand side of the chart, we can see an example of the strategy that the above stated type of individuals use to deceive a huge mass of people. Fake and unrealistic risk-to-reward ratios, impractical percentage returns and other tricks appeal the newcomers and lead them to the mousetrap set by the so-called “gurus”. On the other hand, on the right side of the screen, we can see the reality of trading. Not every trade will be a winning one. The most important thing is to follow the principles of risk management, have patience and discipline! We hope you enjoyed this educational post! If you have any proposals on what should our next educational post be about, please feel free to write down the topics of your interest in the comment section below. Investroy team is wishing you all a great upcoming weekend!
OANDA:XAUUSDEducation
by Investroy
6
What Is Capital Partitioning ? How will it help you as a trader?Hi everyone: Let's talk about capital partitioning, which is a risk management approach for consistent traders to utilize to allow them to leverage their capital. You may ask what exactly is capital partitioning ? well to simply put it in words, it is basically divide up your trading $ in the current trading account into 2 or more sub accounts. So what's the point of doing that you may ask ? Well, with leverage, a consistent trader does not require to have their entire money deposit into one trading account. They can allocate the asset into different trading accounts to reduce risk as well as trading different markets available Let's take a look here: Say I have a $100,000 trading capital. I understand risk management, trading psychology, and will not over trade, over risk and revenge trade. Hence, it's in my best interest to divide the $ in this account into a different accounts, or simply in a liquid-able account such as a savings account, stocks, bond..etc Here are a few scenarios that you can implement into your trading accounts. Understand that the % to allocate, what other trading accounts to deposit $ into, and how to move around the $ is totally up to you as a trader. The most important is to make sure you are a consistent trader before you approach this type of method. As more accounts you divide your capital into, the more % you will need to risk per account as you need to open bigger position sizes now. Any questions, comments, or feedback welcome to let me know. Thank you I will share other risk management educational videos that can be helpful for you. Risk Management: When/How to move SL to BE and to profit in a running trade ? Risk Management: How to filter trading opportunities if multiple setups are presenting entries: Risk Management: 3 different entries on how to enter the impulsive phrase of price action Risk Management 101 Risk Management: How to set a Take Profit (TP) for your trades Risk Management: How to Enter and set SL and TP for an impulse move in the market Risk Management: How to scale in the impulsive phrase of the market condition? Risk Management: Combine everything you learn to prevent blowing a trading account
BITSTAMP:BTCUSDEducation
by jojofang0901
27
The Importance Of Back-Testing Part 1When it comes to trading the financial markets (any market), back-testing your strategies is an absolute must. Although past performance does not guarantee future results, back-testing your strategy cannot be skipped or rushed if you wish to be a consistently profitable trader. Back-testing can be done many different ways today. There are many good software’s & trading platforms with available back-testing tools however, I personally prefer to use a spreadsheet as they are fully customizable & require you to fully understand the operation and function of the data you compile and your strategies performance. In my personal experience, I have found that traders who use software’s as opposed to manually back-testing each trade one by one, have a much more difficult time remaining consistently profitable. One of the effective benefits of manually back-testing your strategies is that you will be training your eyes to spot your specific Conditions & Criteria’s for entry along with getting a feel for the characteristics & movements of the market you are trading. You can manually back-test your strategies by going to your chart and scrolling as far to the left as you would like. Next you will slowly scroll one candle at a time to the right, until you see your setup. Once you see your setup, you should stop and enter the details of the trade into your back-testing tool. After you have entered the details of the trade into your spreadsheet, you should continue scrolling to see the results of the trade. Enter the results of the trade and continue scrolling right until you see your next setup. Your trading timeframe will determine how far back in time you can go for your back-testing. For example if you are using the 60 min chart as your trading timeframe, you should be able to test several years of trades whereas if you are using the 5 min chart as your trading timeframe, you may only be able to test several months of trades. I mainly trade using the 4hr and 60 min charts therefore I personally start my back-testing process by testing 1 years worth of trades. If I am happy with the results of the 1 years worth of tested trades, then I will typically restart the process of back-testing that strategy- going as far back In time as possible. I like to have 3+ years of back-tested trades before I will begin forward testing the strategy & then ultimately trading the strategy live. If you are unsure about the amount of time that you should back-test for your strategy, you can safely make this decision using the amount of trades instead- For example, I recommend back-testing AT LEAST 100 trades. I personally will not begin forward testing a strategy with any less. If the strategy proves profitable after 100 trades, I like to back-test as many as possible. There is no such thing as to much back-testing.  It is very important that we do not cheat during this process. Do your absolute best to scroll slowly as you proceed to avoid seeing the results of the trade before you have made the decision to enter. We must be honest in our approach to testing a strategy, in order to get the most accurate data & results possible. It is easy to see what happens next by accident & convince ourselves why we would or would not have taken that specific trade anyway. Be sure to follow your detailed conditions & criteria’s for entry as this will eliminate making discretional decisions. The purpose of pre-defined conditions and criteria’s for entry is to minimize the decision making process as much as possible. Please understand that cheating during this process is ultimately skewing the results of the strategy as well as cheating yourself! Back-testing serves many purposes to a professional trader & takes up a large portion of their work week as we are always looking for ways to improve our existing strategies and/or develop new, more efficient ones. This stage is also crucial to your confidence in your strategy which ultimately leads to being disciplined and following your set guidelines for the strategy you are using. Your confidence and discipline to your strategy will come into play during periods of “Drawdown" What Is Drawdown? Drawdown is an extended period of time that a traders account experiences loss or no increase in account balance. In other words, drawdown is a losing streak OR a period of time that the account makes no gain or loss. No matter how good a strategy is, it will eventually experience a losing streak. It is extremely important that we measure the severity of these drawdowns otherwise known as "Max Drawdown". Drawdowns can vary from strategy to strategy however as an example, my strategy typically experiences 1-2 drawdowns per year and the average length of these drawdowns are around 30-40 days long. Back-testing can really help maintain emotional stability & psychological logic during these prolonged periods of drawdown. If you begin to feel doubt while these periods of time are occurring, you may go back to your back-testing results to reassure yourself that it is normal for the strategy to not achieve a profit OR even lose a certain amount of money over the course of however long your results show on average. After we have completed 3 years worth of back-testing or at least 100 trades, you will be able to go back and see periods of time (typically 1-2 months) that the account made no money at all or even lost money. As an example- the strategy shown below carries an 11% Max Drawdown over the course of 3 years worth of trading, meaning that at some point during 3 years worth of trading, my account may experience a 11% loss from its current value at that time. This period of time is normal and as long as we do not exceed this Max Drawdown by more than 1 or 2%, we should continue trading our strategy without taking a further look to evaluate whether the strategy is outdated and needs adjusting or if we made trading related errors. looking at the date in the top left (10/4/2018) & Date at bottom right (11/5/2018), we can see that the strategy produced little to no gain over the course of this 32 days. When first starting out as a trader, this can be extremely difficult to deal with. 32 days can feel like a very long time while it is occurring but DO NOT give up on your strategy if it has shown to be profitable throughout your back and forward testing period!! This is where most inexperienced traders begin making mistakes, breaking their rules or change up strategies thinking the one they are using doesn’t work when in fact, this is 100% normal for EVERY strategy. This is where discipline comes into play. If you do not remain disciplined and stick to your strategy/rules during these periods of time, your lack of discipline will lead to inconsistent results & ultimately failure. Lets look at what happened right after this drawdown was finished had you stayed discipline. (See Image Below) In the following 47 days, the strategy managed to produce nearly a 90% gain! I am not saying these are the same results you will get, the point I am trying to make is to not jump from strategy to strategy or start making irrational decisions because of these periods of time. I have seen to many new traders destroy themselves because of drawdown or throw away an amazing strategy because they were unaware and uninformed about these periods of drawdown or because they chose not to back-test a strategy before using it to trade with live money. It is crucial that you extensively test anything you wish to use in the markets before using it. Take the time to feel those losses as if they were real and they were occurring in real time. Don't take anyone's word or back-testing results as your own, simply put the time in to this process yourself & you will find that your perspective of trading changes dramatically. You will start to treat this as a business and you will be one step closer to consistently profitable trading. Note: Back-testing a strategy must be done for each market you plan to trade. For example, your strategy may be profitable on EUR/USD however that does not mean it is profitable on any other currency pair or in any market in general. Be sure to back-test the strategy for each market you wish to trade as strategy results may vary widely from market to market. As a consistently profitable trader for the better half of a decade, the best advice I can give and the one thing I want you to take away from this post is- Always be sure to extensively back-test any trading strategy you plan to use in the markets. Without this step, you are essentially trading blind & will have an extremely hard time with your trading psychology & consistency. The software's out there today have a purpose when used correctly but I highly recommend using a more manual approach. It forces you to understand your strategy while training your eyes to spot your setups. Some Data Points You May Want To Gather For Strategy Optimization- I hope this was helpful for you, please leave a comment and let us know what your back-testing process looks like, and how you go about optimizing your trading strategies.
BITSTAMP:BTCUSDEducation
by Alec40
9
BTC.D : A quick note on bitcoin dominance and altsCRYPTOCAP:BTC.D Hello everyone 😃 Before we start to discuss, I would be glad if your share your opinion on this post and hit the like button if you enjoyed it ! It is inevitable that at some points in the cycle, Bitcoin will outperform almost everything. With a few outliers of course. However, it's important that this doesn't change your game plan. Your game plan should already be set in motion. If you track your portfolio daily, both in USD and BTC, there are always fluctuations if you are holding a mixture of BTC, Alts and USD. It would be near impossible to maintain your portfolio's equivalent BTC value round the clock, unless of course you were all in BTC. I personally hold BTC as my base asset during bull runs (switching to USD at local tops or as near as I can) as well as moving to ETH as my base asset when ETHBTC looks set to out perform. However, it is inevitable that my alt coin holdings (spot) that I have accumulated will take a hit during a strong BTC run - so you may see your 'BTC worth' drop at times; However, I think of alt holdings like a coiled spring. When under pressure BTC, they bleed - and are suppressed. If you've accumulated at support, you need not to worry about the temporary drawdown in BTC, because in general alt coins out perform BTC in the right conditions, and so when bitcoin puts in a local top, altcoins regain their dominance and begin out performing. HOWEVER It is important not to be 'alt heavy' at times when the BTC dominance is at support. It is important to rotate the ratio of BTC:ALT:USD holdings to lessen the impact of alts bleeding at certain times in the market. For example, in January of this year, it was an amazing time to load up on altcoins given that BTC dominance was at resistance. We then saw astronomical gains in alts across Feb/March when BTC.D dropped like a rock. Then, in May when BTC.D hit support, the whole market tanked but alt coins got hit the hardest. Alts will lose value when BTC is volatile, in either direction. So it's important to balance the ratio of your holdings across BTC, alts and stables at certain times in the market. I pay attention to Bitcoin dominance more so for my spot holdings. For my trading account, every asset is simply a method of making a profit on percentage gains. So whether I'm trading BTC, ETH or alts - it doesn't matter as much. But for spot holdings, I generally want to cycle my ALT:BTC or ALT:USD holdings. When BTC.D is at support, I want to hold less alts. When BTC.D is at resistance, I want to load up on alts.
CRYPTOCAP:BTC.DEducation
by Helical_Trades
17
Box Breakouts On Daily, 4 hour & HourlyYes, you should try them yourself: Why? Makes Forex trading a lot simpler to do I add boxes on daily of: DAILY BOXES: 100 pip boxes - vertical lines every Monday and horizontal lines every price action number ending in .000 (psychological #) 4 HOUR BOXES: 50 pip boxes- vertical lines every day after session opens and horizontal lines every .000 & .500 critical price action numbers. 1 HOUR BOXES: 25 pip boxes- vertical lines every 4 hours after session opens and horizontal lines every .000, .250, .500 & .000 price action numbers. If you try this, you will like it. Why? because this will give entry price, stop loss price and 1st and 2nd targets. If your win rate can hit 70% or higher on these 1:1 or 1:2 risk reward setups- then you know exactly what and what you are doing when trading Forex. Risk management is always #1. You can have confluence with support and resistance, pivot points, RSI, BB, etc... before doing this box strategy. If you can use round numbers and quarter numbers in your trading you will be more profitable. Trading Forex is about PRICE and TIME of session going on now.
Education
by Anbat
So You Wanna Trade Full Time... Is it Possible? A Good Idea?I walk you through my thoughts on the dream that most traders have: doing it full-time! I give you my personal experience and how I've tried things in the past. What I'm doing now and what works for me. Key takeaways: - The trifecta: access to capital, good strategy, cost-of-living. You have to solve for 2 / 3 of these! - You can't buy peace of mind. Have other income streams to mitigate the risk from your trading not going well for periods of time.
BITFINEX:XRPUSDEducation
by ImreSG
3
TRADING HIERARCHY | KNOW WHAT MATTERS THE MOST ⚠️❗ Hey traders, I vividly remember how I started to trade 8 years ago, how I was learning, and the things that I was doing. Contemplating my old self, I notice a dramatic shift in my mindset in regards to trading. Staring at the charts and desiring to make money on price action, I wanted to become a consistently profitable trader. Making the priorities, I decided to sacrifice my time on studying technical analysis totally neglecting trading psychology and risk management. Learning different trading strategies I always came to the same result: the account went blown and nothing seemed to work. Strategies of fancy traders on YouTube, strategies from best-selling books on Amazon, nothing could produce any penny. Not giving up and pursuing my ultimate goal I came to the conclusion that I set my priorities absolutely incorrectly. To be honest, I always thought that trading psychology (like psychology in general) is s*cks. Moreover, I considered risk management to be kind of obvious, banal topic not deserving much attention. Learning risk management techniques, applying them in day trading I finally saw a glimmer of hope. Reading dozen of books on trading psychology, contemplating my mistakes, and observing my behavior I noticed so many wrong, incorrect things that I did on a daily basis. With time and practice, my mindset shifted. I realized that most of the strategies that I applied and that seemed losing to me, in fact, were decent. It turned out that mastery of technical analysis is not enough for profitable trading. Instead, that is just a tiny part of what must be learned. Now, when my students ask me about the most important things to learn & study in trading, I always say: trading psychology and risk management go first, technical analysis is the secondary. ❗ Do not neglect these topics and give them due attention. They are an essential part of your success in trading. 🤔 Do you agree with the pyramid that I drew? ❤️Please, support this idea with like and comment!❤️
COINBASE:BTCUSDEducation
by VasilyTrader
44
SINPER CONFLUENCE TRADING OANDA:GBPUSD confluence trading is just multiple reasons stacking up in your favour to take the trade. you should always have some sort of validation to take a trade... my trading style consist of fibonacci levels, psychological levels, support resistance, trend line bounces and much more. one thing to remember is the more confluences you have the more confident you should be in taking the trade. in this example ive shown how you could plot your confluences for you to find a perfect entry with minimal drawdown. take your time to backtest and practice. get your eyes used to seeing these set ups occurring.
Education
by romailfx
The importance of sticking to the plan 👊👌As traders we are our own worst enemies! A common theory with trading is as follows. 10% is having a good strategy, 30% is having good risk management and the final 60% is psychology. If we as traders fail to address the final psychology part of the sentence above then we as traders will fail in the markets. The chart shown in this idea is EURGBP working the 30 minute time frame. The strategy is a rules based mechanical approach working a 1:1 RR to fixed stop loss and take profit targets. I know I have a proven edge with this strategy as with all my ideas the built strategy tester report is at the foot of this idea shows the strategies credentials. Position sizing is correct I trade this strategy on a stand alone account for this pair and I'm happy to risk 2% per trade of my capital from said account. So where does the psychology part come in to all this? The emojis on screen show the emotions I would of been feeling with this trade once upon a time! An emotional roller coaster! The chart shows three trades. A short which hit TP followed by a long which hit SL. Then the trade I'm using for this idea which lasted a full 13 days! But this is where sticking to the plan and the rules I set help remove that emotional roller coaster. Not sticking to that plan could of created many outcomes. I could of closed for less profit than intended as part of the plan or worse still could of cut my losses only for the trade to go on and hit TP target. The above would of then led to more emotions thus effecting my future trading decisions and choices. With each trade I enter I am comfortable with said outcome whatever that maybe. That comes from trading a proven strategy, having correct risk management and then by sticking to the rules of the trading plan for the strategy. Sticking to a plan removes any subjectivity and helps take care of the psychological side of trading. I even automate my strategies now and not checking trades every minute of the day has helped removed all those up and down feelings the emojis on the chart represent. I'll end with one final thought patience has to be part of your plan. The markets take from the impatient and give to the patient ones among us. ------------------------------------------ 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
38
Insanity... the thing most traders do (intro)This is a short intro to a major problem traders face... in a longer video, coming out tomorrow most likely, I will explain more on how to stop being an "insane" trader and take control of your trading results by working on the most important person in (your) "room", which is YOU! Just how important are YOU to yourself? take any picture where you are with the people you love the most and look at it, the person you will first search in the picture is you... so I rest my case. Anyway, this video might wake you up a little, if it doesn't the full version will!
OANDA:US30USDEducation
by PrimedGroup