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Tradingstrategy

Learn The Main Elements of The Trading Strategy There are hundreds of different trading strategies based on fundamental and technical analysis. These strategies combine different tools and trading techniques. And even though, they are so different, they all have a very similar structure. In this educational article, we will discuss 4 important elements every trading strategy should have. 1️⃣ The first compontent of a trading strategy is the list of the instruments that you trade. You should know in advance what assets should be in your watch list. For example, if you are a forex trader, your strategy should define the currency pairs that you are trading. 2️⃣ The second element of any trading strategy is the entry reasons. Entry reasons define the exact set of market conditions that you look for to execute the trade. For example, trading key levels with confirmation, you should wait for a test of a key level first and then look for some kind of confirmation like a formation of price action pattern before you open a trade. 3️⃣ The third component of a trading strategy is the position size of your trades. Your trading strategy should define in advance the rules for calculating the lot of size of your trades. For example, with my trading strategy, I risk 1% of my trading account per trade. When I am planning the trading position, I calculate a lot size accordingly. 4️⃣ The fourth element of any trading strategy is trade management rules. By trade management, I mean the exact conditions for closing the trade in a loss, taking the profit and trailing stop loss. Trade management defines your actions when the trading position becomes active. Here is the example. I took a trade on Friday, following my top-down trading strategy. I was trading Dollar Index (the instrument that is in my trading list). Entry reason was a test of a key level on a daily and a formation of a horizontal range on 1H time frame. The position was opened on a retest of its broken neckline. Position size of this trade was based on 1% of my trading deposit. Stop loss and targets were structure based. Make sure that your trading strategy includes these 4 elements. Of course, your strategy might be more sophisticated and involve more components, but these 4 elements are the core, the foundation of any strategy.
FOREXCOM:XAUUSDEducation
by VasilyTrader
5
Don't listen to your inner NINNY! I can't swear on TV :(Traders have 1 JOB!. To just take the trade. All the other stuff is semantics. But most times you’ll find your inner B I mean Ninny takes over. And it tells you: ~ Don’t take the trade. ~ You’ll lose money. ~ The stars are not aligned! ~ Blah blah fish paste! You need to stop listening to your inner F - inny, or it will destroy your chances of success. So let’s talk about the 4 common excuses traders make and how to overcome them. Excuse #1: I’m not in the mood The markets are awake with or without you. People are making money and doing things in this world. Others are taking ice baths, cold showers, hitting the gym twice a day. They are doing the hard. You need to stop the excuses of not in the mood, get off the couch and take action for your life. You are in control of your life, what you do and what you make. Do what you need to. Create a schedule that includes time for exercise, meditation, and of course trading. Excuse #2: External news event kicked in Financial markets are subject to external events that can impact trading decisions. These events can include political developments, natural disasters, or major economic announcements. The problem is. These events come daily. Every day there are new news announcements, GDP numbers, employment and jobs reports, Interest rates, inflation rates etc…If you’re not taking a trade because of one of these announcements, I’m sorry but. That’s just an excuse! If you must. Write down a few IMPORTANT news announcements that you want to watch for when you trade. Maybe interest rates in America. Maybe NFP reports, Maybe during FOMC meetings. But do the research and find out what news events are worthy to NOT take a trade. I’ve been in the markets for 20 years and I haven’t found one worthy news announcement other than NFP for Forex trading. Excuse #3: Market doesn’t feel right To you it doesn’t feel right. To you, you think the market is some sentimental machine that feels healthy or sick. To me, I see prices, risks and probabilities. I see a robot and mechanical processes with billions of dollars streaming in and out at any one second, the market is opened. You need to develop an objective criteria for assessing market conditions. Have tunnel vision and stop trying to predict the temperature of the market. It’s not human. There is buying. There is selling. There is a repetition of that every day. Market doesn’t feel right, is an excuse. Excuse #4: System lined up but it’s not perfect Ok so you have a system good. You have a strict strategy to follow, great. But the system lined up and it’s not perfect. As I mentioned before. You need to write down the rules and criteria that you can use to identify opportunities and risks. There are only three types of trades in this world. HIGH probability trade – Market lined up perfectly according to the system. MEDIUM probability trade – Market almost lined up perfectly but I will still take the trade and risk a little less. NO trade – Market did NOT line up and therefore I’m not taking a trade. So, are you going to continue to listen to your inner Busy Ninny or are you going to start making money the right way?
TVC:SA40Education
by Timonrosso
Cup and Handle Trading Guide ☕️ The cup and handle pattern is a continuation chart pattern that looks like cup and handle with a defined resistance level at the top of the cup. It forms from a strong drive up that pulled back and consolidated over a period of time creating the cup before making another push to the resistance where it pulls back again but not as far creating the handle and then makes it final push past the resistance level and continuing on the trend. How To Trade A Cup and Handle Pattern To trade using a cup and handle strategy, place your stop buy order a little higher than the handle’s upper trend line. Your order will only execute if the price breaks through the pattern’s resistance. As an alternative you can wait for the price to close higher than the handle’s upper trend line, and then place a limit buy order a little bit lower than the breakout level for the pattern, which will execute if the price retraces. However, you will face the risk of missing the trade if the price fails to pullback and continues to advance uninterrupted. 💫Useful tips: The ideal cup pattern should not be too deep. Avoid patterns with handles that are too deep as well, since the handles should be forming somewhere in the cup pattern’s top half. The volume should be decreasing as the price declines, and then stay lower than the average seen in the base of the cup. The price should increase as the security starts to move higher toward the previous high. The retest at the end of the cup pattern does not need to directly reach the previous high, but the further the top of the handle is from the old high, the less significant the breakout from the handle’s bottom may be. Hey traders, let me know what subject do you want to dive in in the next post?
OANDA:XAUUSDEducation
by TopTradingSignals
5
How to get your Trading DoneTrading is the easiest hardest way to become financially free. You need to follow a simple approach and then have the discipline to do it again and again for the rest of your life. It can at first be a daunting task because you have to implement an element of risk. But before you know it, you’ll be free from your financial shackles and struggle. Here are five tips to help you get your financial trading done efficiently and effectively. Step #1: Always have your cheat sheet with you. A cheat sheet is a list of rules that you have set for yourself when trading. These rules are from how to spot trading signals, getting your trading setup ready, to implementing the maximum amount of money you’re willing to risk on a trade to the indicators you look for when deciding on a trade. Always make sure you have your cheat sheet with you to have a clear set of rules to follow. This way you’ll avoid making impulsive decisions. Step #2: Look for the right trading setups with high probability trades. Before you enter a trade, it’s essential to look for the right trading setup. A trading setup is a specific combination of conditions that must be met before you enter a trade. For example, you may look for a bullish continuation or reversal price breakout strategy, combined with a moving average crossover and RSI divergence indicator. Once you have identified the right trading setup, you can then look for high probability trades within that setup. Step #3: Execute your trades or just take the trade. Once you have identified a high probability trade, it’s time to execute the trade. When executing a trade, it’s important to remember that the market can be unpredictable. You may have done everything right and still end up losing money on a trade. Therefore, it’s essential to take the trade, execute your plan, and move on to the next opportunity. Step #4: Journal your trades It’s essential to keep a record of all your trades, including the reasons why you entered and exited the trade. This can help you identify patterns in your trading and make adjustments to your strategy as needed. This way you can record, monitor and also identify areas where you can improve and re-evaluate your trading plan accordingly. Step #5: Rinse and repeat the process. Finally, once you have executed a trade, recorded it in your journal, and made any necessary adjustments to your trading plan, it’s time to rinse and repeat the process. Trading is a continuous process. There will always be new opportunities to explore and it’s ALWAYS the right time to start or continue. If you follow the above steps, you’ll increase your chances of success and make the most of your trading endeavours.
TVC:SA40Education
by Timonrosso
How to Trade the Pin Bar Pattern on Forex and Gold 🕯 The pin bar is a powerful price action setup that tells a fascinating story concerning price momentum and the possibility of an imminent reversal in price direction. A pin bar is a Japanese candlestick that has a long wick on one side and a small body. Understanding the story behind the pin bar is essential. 📚What does the pin bar candlestick pattern tell us about market psychology? 📉This pin bar followed a strong downward trend, and the presence of a long tail below the body tells us that the market rejected any attempt by overly exuberant sellers to move the price lower. The length of the tail speaks to the strength of the rejection. 📈The pin bar followed by a strong uptrend, and the presence of a long tail above the body tells us that the market rejected any attempt by overly exuberant buyers to move the price higher. The length of the tail speaks to the strength of the rejection. ⭐️The best pin bars are bearish pin bars that form at the top of an extended move up, and bullish pin bars that form at the bottom of an extended move down. ✅Entry and exit is very simple. If you are going short on a bearish pin bar, enter short when the next candle opens and ticks below the low of the bearish pin bar. If you are going long at your fx broker, enter long when the next candle opens and ticks above the high of the bullish pin bar. ❗️Keep in mind that these are general trading concepts that build on the collective experience of traders. Even though a lot of traders believe that these chart patterns have a bearing on the future direction of the price there are no guarantees in trading. Forex & gold trading is risky and you should never speculate with funds you cannot afford to lose. Hey traders, let me know what subject do you want to dive in in the next post?
OANDA:XAUUSDEducation
by TopTradingSignals
10
The Breakout Trading Strategy of Trendlines | OKXIDEAS Hello traders, In this post i am just showing you a very simple and easy trading strategy especially for beginners, in this strategy i am just using two basic things trendlines and 50 simple moving average which is you can also see in the charts above. What you will be doing in this strategy just simply go to the 1hr timeframe see the clear trend draw the trendline wait for the breakout when breakout happen now wait for price to retest or just place a buy limit or sell limit order. I hope you like the strategy this is the trendlines breakout trading strategy. The one good thing about this strategy is the risk to reward ratio because in this strategy you will have potential to have around 1/3 risk to reward ratio so this means if you placed 10 trades and you lose 7 trades out of 10 and you just won 3 trades out of 10, you will be still profitable so meanwhile you just need to have a 30% wining ratio to be profitable in a long run. I just advise you that try the strategy open the chart and back-test your chart and trade it on demo live market condition at least for one month and see the results ask the question to yourself can you be profitable? if the answer is yes so probably you know that what to do next but if the answer is no then look it your one month data that you have, make sure to journal your one month data record and try to analyze what mistakes you do what wining ratio you have can you have a little deference to between 30% see your taken trades you will be seeing some bad trades and you don't wanted to trade next time avoid those trades in the next month and just repeat the process be patient one day you will be consistently profitable but if not then don't lose the hope and just try again again and again learn from your mistakes come back and don't do that mistakes again, remember every strategy is good if you practice and managed it. Just find the strategy that you suit and start the process. I hope you liked the post, i wish you good luck and good trading.
Education
by TheLoserMan
1
How to use Volume and Volatility to improve your tradesVolume and volatility are two important factors that can affect your trading performance. Volume measures the number of shares or contracts traded in a given period, while volatility measures the degree of price fluctuations. Understanding how these two factors interact can help you identify trading opportunities, manage risk, and optimize your entry and exit points. In this article, we will explain how to use volume and volatility to improve your trades in four steps: 1. Analyze the volume and volatility patterns of the market or instrument you are trading. Different markets and instruments have different volume and volatility profiles, depending on factors such as liquidity, supply and demand, news events, and market sentiment. For example, some markets may have higher volume and volatility during certain hours of the day, while others may have lower volume and volatility during holidays or weekends. You can use tools such as volume bars, volume indicators, average true range (ATR), and historical volatility to analyze the volume and volatility patterns of your chosen market or instrument. 2. Identify the volume and volatility signals that indicate a potential trade setup. Volume and volatility signals can help you confirm the strength and direction of a trend, spot reversals and breakouts, and gauge the momentum and interest of the market participants. For example, some common volume and volatility signals are: - High volume and high volatility indicate strong conviction and participation in a trend or a breakout. This can be a sign of a continuation or an acceleration of the price movement. - Low volume and low volatility indicate weak conviction and participation in a trend or a breakout. This can be a sign of a consolidation or a slowdown of the price movement. - Rising volume and rising volatility indicate increasing interest and activity in the market. This can be a sign of a potential reversal or breakout from a consolidation or a range. - Falling volume and falling volatility indicate decreasing interest and activity in the market. This can be a sign of a potential exhaustion or continuation of a trend. 3. Choose the appropriate trading strategy based on the volume and volatility conditions. Depending on the volume and volatility signals you observe, you can choose different trading strategies to suit the market conditions. For example, some possible trading strategies are: - Trend following: This strategy involves following the direction of the dominant trend, using volume and volatility to confirm the trend strength and identify entry and exit points. You can use trend indicators, such as moving averages, to define the trend direction, and use volume indicators, such as on-balance volume (OBV), to measure the buying and selling pressure behind the trend. You can also use volatility indicators, such as Bollinger bands, to identify periods of high or low volatility within the trend. - Reversal trading: This strategy involves identifying potential turning points in the market, using volume and volatility to confirm the reversal signals. You can use reversal patterns, such as double tops or bottoms, head and shoulders, or candlestick patterns, to spot potential reversals, and use volume indicators, such as volume profile or accumulation/distribution line (ADL), to measure the distribution or accumulation of shares or contracts at different price levels. You can also use volatility indicators, such as standard deviation or Keltner channels, to identify periods of overbought or oversold conditions that may precede a reversal. - Breakout trading: This strategy involves trading when the price breaks out of a consolidation or a range, using volume and volatility to confirm the breakout validity and direction. You can use support and resistance levels, such as horizontal lines, trend lines, or Fibonacci retracements, to define the boundaries of the consolidation or range, and use volume indicators, such as volume breakout or Chaikin money flow (CMF), to measure the inflow or outflow of money during the breakout. You can also use volatility indicators, such as average directional index (ADX) or Donchian channels, to measure the strength or weakness of the breakout. 4. Manage your risk and reward based on the volume and volatility expectations. Volume and volatility can also help you determine your risk-reward ratio, position size, stop-loss level, and profit target for each trade. Generally speaking, - Higher volume and higher volatility imply higher risk and higher reward potential. You may need to use wider stop-losses and profit targets to account for the larger price fluctuations. You may also need to reduce your position size to limit your exposure to the market. - Lower volume and lower volatility imply lower risk and lower reward potential. You may need to use tighter stop-losses and profit targets to account for the smaller price fluctuations. You may also need to increase your position size to enhance your returns from the market. By following these four steps, you can use volume and volatility to improve your trades in any market or instrument. Volume and volatility are dynamic factors that reflect the supply and demand forces in the market.
BLACKBULL:SPX500Education
by JS_TechTrading
What is Trading Plan? Detailed Example A short ⚠️disclaimer before we start: the rules that will be discussed in this post are applicable only for technicians - traders that are relying on price action/structure/etc. Also, we assume that structure levels do work and for us, key levels are considered to be the safest trading zones/points. In order to increase the accuracy of your predictions analyzing different financial markets, you must learn to identify the direction of the market.📈 The identification of the market trend must be based on strict & reliable & testable rules. It can be based on technical indicators or price action Personally, I prefer to rely on price action. There are three main types of market trends: Bullish Trend Bearish Trend Sideways Market Depending on the current direction of the market, on the chart, I drew a flow chart✔️ that will help you to act safely. ➡️Sideways market signifies consolidation & indecision. Usually being in such a state the market tends to coil in horizontal ranges. To trade such a market safely, the best option for you will be to wait for a breakout of the range & wait for the initiation of the trend. ➡️Once you spotted a bullish market, do not rush to buy. Your task will be to identify the closest strong structure support . You must be patient enough to let the price reach that support first (and by the way, there is no guarantee that it will happen) and then you must wait for a certain confirmation. Only once you get the needed confirmation you can buy the market. ➡️The same strategy will be applicable to a bearish market. Spotting a short rally it is way early to just sell the asset from a random point. You must find the closest strong structure resistance and wait for the moment when the price will approach that. Then your task will be to wait for a confirmation and only when you got the reliable trigger you short the market. 🦉Try to rely on this flow chart and I promise you that you will see a dramatic increase in your trading performance. And even though it may appear to you that this flow chart is TOO SIMPLE, in practice, even such a set of rules requires iron discipline and patience. Thank you so much for reading this article, I hope you enjoy it! Let me know, traders, what do you want to learn in the next educational post?
OANDA:XAUUSDEducation
by VasilyTrader
10
Avoiding and Managing Margin Calls Trading on margin offers a variety of potential benefits, as well as some additional risks, including margin calls. This lesson explains margin calls, your obligations, and what you can do to help avoid them. A margin call is a demand from your brokerage firm to increase the amount of equity in your account. You can do this by depositing cash or marginable securities to your account or by liquidating existing positions to generate cash. To avoid margin calls, you need to understand fully what triggers a margin call, along with the steps you can take to minimize the risk of a margin sellout. Margin calls can be a stressful experience with serious financial implications. Your brokerage firm may sell securities you own—without notifying you and without regard to tax consequences—in order to increase the equity in your account. Therefore, consider these suggestions to minimize the odds of experiencing a margin call: Prepare for volatility: Leave a considerable cash cushion in your account that protects you from a sudden drop in the value of your loan collateral. Set a personal trigger point: Keep additional liquid resources at the ready in case you need to add money or securities to your margin account. Monitor your account daily: Consider setting up alerts to notify you when the value of your positions declines significantly. If you fail to understand the concept of margin or not knowing what to do when faced with a margin call from your broker, you will definitely experience the shock of your trading account blow up. What do you want to learn in the next post?
TVC:GOLDEducation
by UnitedSignals
5
WHY YOU Don't always Receive INTEREST when you are short... Q. I thought that when you go short (sell) that we earn interest (swap fees) per day. But to my surprise I was actually charged interest on my open trade with AUD/NZD. Was I not meant to earn interest?” A. Unfortunately, it depends… With each market you trade, you’ll need to look at the symbol information for each trade you take. This also depends on the deal the broker has with each market. For example, when you SELL AUD/NZD you're essentially buying NZD/AUD (as they are currency pairs). So whether you go long or short, you don't earn interest with short (sell) currencies... But make sure, you always look at Symbol information and see what swaps are positive when you are short. With the AUD/NZD you can see you pay -3.35% per year. That means each day you hold, you’ll have to pay 0.009% per day. Then with some commodities and indices you’ll either earn interest or you’ll have to pay interest when you short (sell). For example, with gold you’ll receive an interest of 1.23% per year. Whereas with cotton you’ll pay 5.4% per year. With the UK 100 FTSE, you’ll pay an annual interest of -0.24%. And with the Dow Jones you’ll receive 0.74% per year. Then with local and international stocks, you’ll receive a certain % of interest (swap fees) per year. So make sure you always check to see what each swap (daily interest fee) entails. This obviously depends on the Market Maker you're using and if you're using Trading View make sure you see the information from your broker what the interest swaps (fees) are when you go long or short.
TVC:SA40Education
by Timonrosso
EXPLAINED: A Bearish Fair Value Gap (FVG) - Smart Money ConceptsA Bearish Fair Value Gap is a 3 candle structure with a DOWN impulse candle (2nd) that indicates and creates an imbalance or an inefficiency in the market. WHAT DO THE IMBALANCES TELL US? These imbalances tell us that the buying and selling is not equal. Now the market needs to rebalance (move at least to 50% of the fair value gap to fill) to make up for the imbalance and rebalance. For this to happen we need to see orders filled in the prices of the candle with the FVG. HOW A BEARISH FAIR VALUE GAP IS CONSTRUCTED: 1st Candle Draw a horizontal line from the bottom of the wick. 3rd Candle Draw a horizontal line from the top of the wick 2nd Candle Draw a BOX between the bottom and the top and pull it over to see the FVG range. BETWEEN CANDLE 1 and CANDLE 3: Do NOT show common prices. They do NOT touch where the lower & the upper wicks do NOT overlap. With a Bearish FVG we can expect the market price to move UP. HOW MUCH? I believe a Bearish FVG needs to close at least 50%. So you can drag a Gann Box or a Fib retracement (take out all the other levels except 50%). Wait for the price to close and fill the prices and boom - Your Bearish Fair Value Gap has been filled. SO WHAT? When you see a Bearish Fair Value Gap, you can expect the price to move up. So you can place your stop loss below the downtrend. You can place your entry where it shows upside is imminent to close the gap. You can place your take profit above the 50% of the formation, as you expect the price to close. But also, we use other confirmation signals with the Bearish Fair Value Gap. Let me know if you have any other SMC (Smart Money Concepts) Questions.
TVC:SA40Education
by Timonrosso