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XAGUSD 1D RANGE TRADESRanges are repeatable trading chart patterns. Ranges are consolidation chart patterns that can breakout either direction. Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern. Whatever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart). Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place. Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement. When you see descending Volume bars and descending ATR line (which indicates volatility) this shows a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern. Trade Management after there is a breakout candle close. 1 - Position size (compare volume bar to volume ma line). a - Breakout candle must be 100% of average volume for a full position size. b - If 75% of average volume then ½ position size. (To find 75% of Volume look at the charts volume settings – divide smaller # into larger # = 75%+) 2 - Enter two trades. 3 - SL for both trades will be 1.5 x ATR. 4 - 1st trade TP will be 1 x ATR. 5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price. 6 - When 1st TP hit – move 2nd trade SL to breakeven. 7 - Adjust the 2nd trade SL to follow price. *8 – After Breakout candle – if price closes back into chart pattern close trade *9 - When breakout candle is more than 1 ATR from breakout candle open. a - Enter 1st trade at candle close with ½ position size. b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open. c – Price should pullback to that pending limit order for 2nd trade. d – If Price returns back into chart pattern close trade before SL is hit.
OANDA:XAGUSD
by Tradingstrategyguides
2
AMD 1D RANGE TRADESRanges are repeatable trading chart patterns. Ranges are consolidation chart patterns that can breakout either direction. Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern. Whatever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart). Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place. Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement. When you see descending Volume bars and descending ATR line (which indicates volatility) this shows a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern. Trade Management after there is a breakout candle close. 1 - Position size (compare volume bar to volume ma line). a - Breakout candle must be 100% of average volume for a full position size. b - If 75% of average volume then ½ position size. (To find 75% of Volume look at the charts volume settings – divide smaller # into larger # = 75%+) 2 - Enter two trades. 3 - SL for both trades will be 1.5 x ATR. 4 - 1st trade TP will be 1 x ATR. 5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price. 6 - When 1st TP hit – move 2nd trade SL to breakeven. 7 - Adjust the 2nd trade SL to follow price. *8 – After Breakout candle – if price closes back into chart pattern close trade *9 - When breakout candle is more than 1 ATR from breakout candle open. a - Enter 1st trade at candle close with ½ position size. b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open. c – Price should pullback to that pending limit order for 2nd trade. d – If Price returns back into chart pattern close trade before SL is hit.
NASDAQ:AMD
by Tradingstrategyguides
EURUSD 1H VOLUME TRADING STRATEGY LONG TRADEVolume Trading Strategy This volume trading strategy uses two very powerful techniques that you won’t see written anywhere else. These are trade secrets that we’ve only been taught to professional traders. The Chaikin indicator will dramatically improve your timing and teach you how to trade defensively. Having a good defense when trading is absolutely critical to keep the profits that you’ve earned. In this article, we’re going to look at the buy side. The Importance of Buying Volume and Selling Volume Volume trading requires you to pay careful attention to the forces of supply in demand. Volume traders will look for instances of increased buying or selling orders. They also pay attention to current price trends and potential price movements. Generally, increased trading volume will lean heavily towards buy orders. These positive volume trends will prompt traders to open a new position. On the other hand, if the cash flow and trading volumes decrease– we see a “bearish divergence”, meaning that it will likely be an appropriate time to sell. You also need to pay attention to the relative volume—regardless of the raw number of transactions occurring in a trading period. Ask yourself how is the prospective asset performing relative to what was expected? By learning how to use the Chaikin money flow and other relevant indicators, you will easily be able to identify whether the buyer or the seller is currently “in control.” With practice, volume trading strategies can yield wins for your portfolio 77% of the time! Step #1: Chaikin Volume Indicator must shoot up in a straight line from below zero (minimum -0.15) to above the zero line (minimum +0.15). When the Volume goes from negative to positive in a strong fashion way it has the potential to signal strong institutional buying power. That’s our base heavy lifting signal! Basically, we let the market to reveal its intentions. When big money steps into the market, they leave a mark as their orders are so big that it’s impossible to hide. When the volume indicator Forex goes straight from below zero to above the zero line and beyond, it shows accumulation by smart money. We’re a firm believer that you get the maximum bang for your buck when you trade side by side with smart money. Chances are that institutions have more money and more resources at their disposal. Odds can be stacked against you, so if you want to change that, just follow the smart money. There is one more condition that needs to be satisfied to confirm a trade entry. Step #2: Wait for the Volume Indicator Forex to slowly pullback below the zero line. The price needs to remain above the previous swing low. Once we spotted the elephant in the room, aka the institutional players, we start to look for the first sign of market weakness. Here is how to identify the right swing to boost your profit. We’re going to let the Chaikin Money Flow indicator slowly drop below the zero line. The keyword here is “slowly”. We don’t want to see the volume dropping fast because this will invalidate the accumulation noted previously. Second, as the volume decreases and drops below the zero, we want to make sure the price remains above the previous swing glow. This will confirm the smart money accumulation. The Volume strategy satisfies all the required trading conditions, which means that we can move forward and outline what is the trigger condition for our entry strategy. Step #3: Buy once the Chaikin Forex indicator breaks back above the zero line. Wait for the candle to close before pulling the trigger. Now that we have observed real institutional money coming into the market, we wait for them to step back in and drive the market back up. When the Chaikin indicator breaks back above zero, it signals an imminent rally as the smart money is trying to markup the price again. We would need to wait for the candle close to confirm the Chaikin break above the zero line. Once everything aligns, we’re free to open our long position. *Note: The trigger candle needs to have the closing price in the upper 25%. This brings us to the next important step. We need to establish the Chaikin trading strategy which is finding where to place our protective stop loss. Step #4: Hide your protective Stop Loss under the previous pullback’s low Using a stop loss is crucial if you want to have an idea of how much you’re about to lose on your trade. Never underestimate the power of placing a stop loss as it can be lifesaving. Simply hide your protective stop loss under the previous pullback’s low. Never use a mental stop loss, and always commit an SL right at the moment you open your trades. Trading with a tight stop loss can give you the opportunity to not just have a better risk to reward ratio, but also to trade a bigger lot size. Step #5: Take profit when the Chaikin Volume drops below -0.15 Once the Chaikin volume drops back below -0.15, it indicates that the sellers are stepping in and we want to take profits. We don’t want to risk giving back some of the profits gained so we liquidate our position at the first sign of the smart money stepping in on the other side of the market. We always can get back into the market later if the smart money buyers show up again. **Note: The above was an example of a BUY trade using the best volume indicator. Use the same rules for a SELL trade – but in reverse. Conclusion – Best Volume Indicator The Volume Trading Strategy will continue to work in the future because it’s based on how the markets move up and down. Any market moves from an accumulation (distribution) or base to a breakout and so forth. This is how the markets have been moving for over 100 years. Smart money always seeks to mask their trading activities, but their footprints are still visible. We can read those marks by using the proper tools. Make sure you follow this step-by-step guide to properly read the Forex volume. The Chaikin indicator will add additional value to your trading because you now have a window into the volume activity the same way you have when you trade stocks. Volume Indicator Forex In the Forex market, we don’t have a centralized exchange of total volume because we’re trading over the counter. If we look at any trading platform like TradingView, they have a volume attached to their chart. But, since we don’t have a centralized exchange that volume is coming from the feed that TradingView uses. Each retail Forex broker will have their own aggregate trading volume. We can see that the volume in the Forex market is segmented, which is the reason why we need to use our best volume indicator. The Volume indicator Forex used to read a volume in the Forex market is the Chaikin Money Flow indicator (CMF). The Chaikin Money Flow indicator was developed by trading guru Marc Chaikin, who was coached by the most successful institutional investors in the world. The reason Chaikin Money Flow is the best volume and classical volume indicator is that it measures institutional accumulation-distribution. Typically on a rally, the Chaikin volume indicator should be above the zero line. Conversely, on sell-offs, the Chaikin volume indicator should be below the zero line.
Education
by Tradingstrategyguides
2
GBPUSD 4H EMA SHORT TRADING STRATEGYExponential Moving Average Strategy (Trading Rules – Sell Trade) Our exponential moving average strategy is comprised of two elements. The first degree to capture a new trend is to use two exponential moving averages as an entry filter. By using one moving average with a longer period and one with a shorter period, we automate the strategy. This removes any form of subjectivity from our trading process. Step #1: Plot on your chart the 20 and 50 EMA The first step is to properly set up our charts with the right moving averages. We can identify the EMA crossover at the later stage. The exponential moving average strategy uses the 20 and 50 periods EMA. Most standard trading platforms come with default moving average indicators. It should not be a problem to locate the EMA either on your MT4 platform or Tradingview. Step #2: Wait for the EMA crossover and for the price to trade below the 20 and 50 EMA. The second rule of this moving average strategy is the need for the price to trade below both 20 and 50 EMA. Secondly, we need to wait for the EMA crossover (20 ema below 50 ema), which will add weight to the bearish case. By looking at the EMA crossover, we create an automatic buy or sell signals. Since the market is prone to false breakouts, we need more evidence than a simple EMA crossover. At this stage, we don’t know if the bearish sentiment is strong enough to push the price further after we sell to make a profit. To avoid the false breakout, we added a new confluence to support our view. This brings us to the next step of the strategy. We refer to the EMA crossover for a sell trade when the 20-EMA crosses below the 50-EMA. Step #3: Wait for the zone between 20 and 50 EMA to be tested at least twice, then look for selling opportunities. The conviction behind this moving average strategy relies on multiple factors. After the EMA crossover happened, we need to exercise more patience. We will wait for two successive and successful retests of the zone between the 20 and 50 EMA. The two successful retests of the zone between 20 and 50 EMA give the market enough time to develop a trend. Never forget that no price is too high to buy in trading. And no price is too low to sell. Note* When we refer to the “zone between 20 and 50EMA,” we actually don’t mean that the price needs to trade in the space between the two moving averages. We just wanted to cover the whole price spectrum between the two EMAs. This is because the price will only briefly touch the shorter moving average (20-EMA). But this is still a successful retest. Now, we still need to define where exactly we are going to sell. This brings us to the next step of the strategy. Step #4: Sell at the market or a limit order when we retest the zone between 20 and 50 EMA for the third time. If the price successfully retests the zone between 20 and 50 EMA for the third time, we go ahead and sell at the market price inside the zone with a bearish candle close or limit order at 50 ema line. We now have enough evidence that the bearish momentum is strong to continue pushing this market lower. Now, we still need to define where to place our protective stop loss and where to take profits. This brings us to the next step of the strategy. Step #5: Place the protective Stop Loss 20 pips above the 50 EMA After the EMA crossover happened, and after we had two successive retests, we know the trend is down. As long as we trade below both exponential moving averages the trend remains intact. In this regard, we place our protective stop loss 20 pips above the 50 EMA. We added a buffer of 20 pips because we understand we’re not living in a perfect world. The market is prone to do false breakouts. Step #6: Take Profit once we break and close above the 50-EMA In this particular case, we don’t use the same exit technique as our entry technique, which was based on the EMA crossover. If we waited for the EMA crossover to happen on the other side, we would have given back some of the potential profits. We need to consider the fact that the exponential moving averages are a lagging indicator. The exponential moving average formula used to plot our EMAs allow us to still take profits right at the time the market is about to reverse.
Short
by Tradingstrategyguides
2
RUSSELL 2000 INDEX BEAR FLAG SHORTBear Flags are Channel Ranges and they are repeatable trading chart patterns. Bear Flag chart patterns will have a directional bias depending on the previous incoming trend (Short). Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern. Whatever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart). Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place. Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement. When you see descending Volume bars and descending ATR line (which indicates volatility) this shows a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern. Trade Management after there is a breakout candle close. 1 - Position size (compare volume bar to volume ma line). a - Breakout candle must be 100% of average volume for a full position size. b - If 75% of average volume then ½ position size. (To find 75% of Volume look at the charts volume settings – divide smaller # into larger # = 75%+) 2 - Enter two trades. 3 - SL for both trades will be 1.5 x ATR. 4 - 1st trade TP will be 1 x ATR. 5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price. 6 - When 1st TP hit – move 2nd trade SL to breakeven. 7 - Adjust the 2nd trade SL to follow price. *8 – After Breakout candle – if price closes back into chart pattern close trade *9 - When breakout candle is more than 1 ATR from breakout candle open. a - Enter 1st trade at candle close with ½ position size. b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open. c – Price should pullback to that pending limit order for 2nd trade. d – If Price returns back into chart pattern close trade before SL is hit.
CME_MINI:RTY1!Short
by Tradingstrategyguides
XAUUSD GOLD 1D RANGE TRADESRanges are repeatable trading chart patterns. Ranges are consolidation chart patterns that can breakout either direction. Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern. Whatever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart). Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place. Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement. When you see descending Volume bars and descending ATR line (which indicates volatility) this shows a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern. Trade Management after there is a breakout candle close. 1 - Position size (compare volume bar to volume ma line). a - Breakout candle must be 100% of average volume for a full position size. b - If 75% of average volume then ½ position size. (To find 75% of Volume look at the charts volume settings – divide smaller # into larger # = 75%+) 2 - Enter two trades. 3 - SL for both trades will be 1.5 x ATR. 4 - 1st trade TP will be 1 x ATR. 5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price. 6 - When 1st TP hit – move 2nd trade SL to breakeven. 7 - Adjust the 2nd trade SL to follow price. *8 – After Breakout candle – if price closes back into chart pattern close trade *9 - When breakout candle is more than 1 ATR from breakout candle open. a - Enter 1st trade at candle close with ½ position size. b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open. c – Price should pullback to that pending limit order for 2nd trade. d – If Price returns back into chart pattern close trade before SL is hit.
OANDA:XAUUSD
by Tradingstrategyguides
1
BTCUSD 1H WILLIAMS Fractal Trading Strategy Long TradeFractal Trading Strategy Steps: The Fractal Trading Techniques Step #1: Apply Both Fractals and Bill Williams Alligator Indicator on Your Chart The First step you are going to want to do is, of course, throw these important indicators on your charts. As I have said, they do come standard on every trading platform that I am aware of so this should be very simple for you to do. Once you do this your chart will look like ours. Step #2A: Trading Fractals Bill Williams: Identify where the Fractal Has Formed (above or below alligator teeth) Note** In this example we are using a buy trade entry so all of these rules will be for a buy entry. Ok, so let’s get into what the fractals are all about. The fractals indicate a bottom or a top. The basic fractal indicator is composed of a very minimum of 5 bars. So when you see a fractal here is what may have happened for it to appear: *There were a series of at least five successive bars, with the highest high in the middle and then the two lower highs are on both sides. *There was a reversing series of at least five successive bars when the lowest low is in the middle and the two higher lows were on both sides (which forms a sell fractal) *Fractals can appear with only one candle to the right of it but be aware that this is an unconfirmed fractal because the price action may pierce through the level. So in order for a fractal to appear and stay on the chart forever, the trader must wait for 2 candles to the right of the fractal. *The fractals have what’s called a high and a low value. This is indicated by the up or down arrows. Now you need to be aware of where the fractals are being placed on the candles for this strategy concerning this special indicator. In a BUY trade, the Fractal must appear on a candle ABOVE the red line (alligator teeth). What is happening here is that the fractal forms a new high to the previous fractal and therefore made an up fractal appear on the candles. In order to go to step #2B (for a BUY trade), the fractal must show an up fractal and be appearing above the alligator teeth. Step #2B: The price action must stay above the Alligator Teeth for at least 5 consecutive candles (Buy Trade) This is where all the magic happens. More often than not when a fractal appears like the one above, the price action is still “flat”. This means there has not been a real breakout in the recent timeframe. You can also trade with the breakout triangle strategy. The reason this strategy has to wait for at least five consecutive candles is that this is the time where either there is pull back that is forming, a reversal may be forming, or the price action is still consolidating in a flat market. Any one of those does not sound pleasant if you are looking for a big upward bullish move to form on the chart. As you can see, the price action stayed quiet and did not move up or down drastically these five candles. That is exacly what you should see when trading this strategy. Before we look any further into this strategy, here is what will make the strategy “reset” and invalidate a future trade BUY entry. Resets if: A sell fractal appears below Alligator Teeth line before a position is opened. As you can see if this would have happened in our BUY trade example, then we would have told ourselves that this buy trade is invalidated and we should look elsewhere. The reason is that this could trigger a long Bearish trend which would not be good if you are attempting to go long here. Resets if: Any of the two lines of the Alligator indicator have crossed after the identified fractal candle in Step #1. Step # 3: Price Action Need to Break Above Fractal Candle That was Distinguished in Step #1 Once you see that five consecutive candles did not make a drastic move to the downside and stay in between the high of the fractal candle and the alligator teeth, then we go ahead and make an entry order. You can make an entry this way, or if you are sitting in front of your charts live with this occurs, then you can make a market order also. Either one is ok to do because the same criteria are needed. As you can see, I marked where our original fractal was discovered. What happened after was that there were five or more candles that appeared that did not drift down to the alligator teeth, the alligator lines did not cross, and the price action finally broke above the fractal candle thus triggering a trade. Take Profit Targets/ Stop Loss. You can try variations to this strategy as far as the take profit and stop loss is concerned. Exit the trade when two of the alligator lines cross over each other. This most likely means the alligator is going back to sleep and the price action will either head the other way or consolidate. Place your stop loss below prior support/ resistance areas. This will give you the best opportunity to salvage a trade if the price action would to turn on you and turn into a bearish trend. It may “bounce” off these areas and head back in a bullish direction. The above were the BUY entry criteria. A sell would be the exact same rules only the opposite. Sell Trade Steps: Step #1 Apply Both Fractals and Bill Williams Alligator Indicator on Your Chart Step #2 A down fractal must appear below alligator teeth and The price action must stay below the Alligator Teeth for at least 5 consecutive candles. Step # 3 Price Action Need to Break Below Fractal Candle That was Distinguished in Step #1 Step #4 Exit the trade when two of the alligator lines cross over each other. Conclusion These basic fractal trading techniques should lead you in the right direction if you have been searching for a great strategy to use with these indicators. There are many different strategies you can use with these indicators, but in our experience, we like this combination of the Bill Williams indicators. Many argue that every indicator is “lagging” and rarely show you profitable entries. The Fractal Trading Strategy uses the combination of price action analysis that complements these great indicators. So if you are one of the skeptics, give this strategy a try and let us know your results. We love hearing your guys feedback!
BITFINEX:BTCUSDEducation
by Tradingstrategyguides
4
EURAUD 15M 9/30 TRADING STRATEGY LONG TRADEThese are the rules for a long trade signal: 9-period EMA must be above the 30-periods WMA. The two moving averages need to be apart from each other. The first bar that closes below the 9-EMA will be used as the trigger bar for the buy setup. Place a buy limit order above the high of the trigger bar. Note* the bar that closes below the 9-EMA needs to remain above the 30-WMA for this setup to be valid. (Opposite for short trade) What is the 9/30 Trading Setup Originally, the 9/30 trading setup was developed by Mike Burns and involves using a combination of two moving averages: 9-period Exponential Moving Average (EMA) 30-periods Weighted Moving Average (WMA) In this case, the 9-EMA is our short-term moving average, while the 30-EMA is out long-term moving average. The 9 and 30 EMA trading strategy seeks to take advantage of the blank space created between the two moving averages. The filter for the 9/30 trading setup can be summarized into a three-step process. Like with many trading strategies we present, you can always use different “flavors” to get into a trade. So, you can also use chart patterns to fine-tune your entry. How to Trade with the 9/30 EMA Strategy In this section, we’re going to teach you how to effectively trade with the 9/30 EMA strategy. No matter how simple this trading strategy is, you need to have a set of trading rules before you use it. So, let’s talk about the stop loss and take profit strategy.For the stop-loss strategy, you can use the trigger bar high/low for reference. For example, if you have a buy trade signal, you hide your protective stop loss below the low of the trigger bar. Alternatively, for a more conservative approach, you can hide your protective stop loss below the 30-periods WMA. Here is a little bit of trading wisdom from hedge fund billionaire Bruce Kovner: “Place your stops at a point that, if reached, will reasonably indicate that the trade is wrong, not at a point determined primarily by the maximum dollar amount you are willing to lose.” Please note that the lower the time frame used the more price whipsaws you’re going to experience. As a trading trick to avoid being caught in a whipsaw trade, make sure you add an extra buffer to your stop loss. This buffer will allow your stop loss to survive during false breakouts. Moving on… It’s easy to exit these types of trades via a trailing stop loss below the 30 WMA. This exit moving average strategy has two benefits: You don’t have to guess a possible take profit level. You got to keep riding the trend until a reversal happens. When to use the 9/30 Trading Method The 9/30 trading method is a type of trend following strategy that seeks to enter the trade on pullbacks. In this regard, the best time to use the 9/30 trading strategy is when we have established a trend. The trend can be defined via the two moving averages as follows: The bullish trend is defined when the 9 EMA is above the 30 WMA The bearish trend is defined when the 9 EMA is below the 30 WMA The strength of the trend can also be measured via the space created between the two moving averages and the angle of the moving averages. The bigger the gap between the 9 EMA and 30 WMA and the steeper the angle of the 2 moving average is, the stronger the trend is. Conversely, the flatter the two moving averages are, the weaker the trend is. In and of itself the “trigger bar” used to enter our trades doesn’t give us a trading edge. The edge comes from trading in the direction of the prevailing trend. After you have a moving average crossover and a strong trend emerges from it, that’s when you want to use this strategy. Note* Avoid using the 9/30 trading setup in flat markets. Moving forward, we’ll teach you how to implement more advanced trading concepts along with the 9 and 30 EMA trading strategy. 9 and 30 EMA Trading Strategy – Advanced Concepts The 9 and 30 moving average strategy is a versatile trading strategy that can be used in ways you never thought possible. You can use this method for short-term trading, medium-term trading and long-term trading. It all depends on your preferred time frame. Now, here is a powerful trading secret about the types of moving averages used in this strategy. The combination of the exponential moving average and the weighted moving average gives us a wider spread between the two MAs. This is a key principle that makes this MA strategy work. Now, you might wonder: “How can we improve the 9 and 30 EMA trading strategy?” If we add a better entry filter, we can gain an extra edge. What do we mean by this? Instead of using a bar that closes above/below the 9-period EMA, we can wait for the entire bar to be encompassed between the 9-EMA and 30-WMA. However, the downside to this trading approach is that you will get fewer trading setups. Often times this type of trading setup can lead to explosive trades that never look back. What are other ways to use the 9/30 trading setup? As we explained earlier the edge of this pattern relays on the resumption of the trend. So, what’s the simplest way to measure the trend direction? A series of higher high followed by a series of higher lows defines an uptrend. In reverse, a series of lower highs followed by a series of lower lows define a downtrend. So, we want to look for ways to capture these types of price structures. To do this we’re going to introduce the concept of multi-timeframe analysis. Note* the advanced 9/30 trading setup works best in conjunction with the daily chart. To better time our entries, we’re going to a combination of two-time frames as follows: The daily chart to spot the trigger candle that closes above/below the 9 EMA Downgrade the TF to 15-minutes (or 5 minutes) and look for uptrend and downtrend price structures If you haven’t realized… Here is the main reason why we use this approach: We know that the daily range can be quite high. So, instead of using the high of the daily candle to trigger our entry we downgrade our chart and seek on lower time frames early signs of upward/downward price structures. Secondly, this trading approach also reduces the stop loss needed for the daily candle. Based on the 9/30 trading strategy we need to wait for the daily candle low to be tagged to trigger an entry. However, whit this new advanced concept we can enter the market early and capture more pips. When we downgrade to the 5-minute chart, we can notice the pattern of lower highs and lower lows signalling the start of a downtrend. Keeping in mind the chart setup found on the daily time frame, we can make a trade on the 5-minute chart when price breaks and forms a new lower low. When the price makes a new lower low after at least two lower highs it develops the price structure of a downtrend. This makes an excellent entry method for the 9 and 30 EMA trading strategy. Final Words – 9/30 Trading Strategy In summary, the 9/30 trading setup is a very effective trading strategy to be used across all markets and time frames. Keep in mind that the power of the 9/30 trading strategy comes from having a prior upwards (downwards) trend. Traders should use this method as a pullback trading strategy rather than try to find reversals. The key takeaways from the 9 and 30 EMA trading strategy can be summarized below: You have the momentum power of the prevailing trend on your side You only need to focus on the gap between the two moving averages Offers you effective ways to manage your risk Built-in trailing stop Versatility to be used in conjunction with other trading methods Last but not least, make sure you use effective money management strategies and position size to protect your capital. After all, your number one priority as a trader is to protect your account balance at all cost.
Education
by Tradingstrategyguides
1
USDJPY 1H Bearish Pennant Short TradeWhat are Pennant Patterns? Flag and Pennants meaning Pennant patterns form after a strong price movement. This is because after a strong upward or downward movement the buyers or the sellers take a break and battle for a short period before the trend eventually breaks out and continues the primary trend. Step #1 Apply Parabolic SAR indicator to the chart. The Parabolic SAR indicator will show you where the main trend is heading. Check out our Parabolic SAR strategy here if you want to specifically trade with this indicator. With this strategy, we have this on the chart to help us make a great trading decision when it comes time to make an entry/exit the trade. Step #2 Find a Strong Bullish, Bearish Trend Most likely you will see this occur with 2-5 strong consecutive bullish or bearish candles. There are no Retracement candles; these should be unsustainable upward or downward candles. Notice that the parabolic SAR dots are above the candles, which is an indication that the trend is pushing down. If the dots are below the candles, the trend is going up, if they are above the candles the trend is going down. Step #3 Analyze Consolidation After Big Price Move. After a large pip downward move you see that many sellers got out of this trade and took their profit. Now what is most likely to occur is that there will be a short battle between the buyers and sellers at this point before a new wave of sellers will take over and drive the price down again! You want to be one of those sellers, and that is why having a strategy like this is so important to have. Some see that move and have no idea what happened and where they should enter if the trend will continue. But you will not be one of them after you learn this strategy. Step #4 Draw Pennant that is Forming. #1- Draw a line on the Strong Bearish candles that formed #2, #3- Draw a line on the higher lows and lower highs (If you down know what these are tap here and I go into detail about this in our Breakout triangle strategy) Once you do this, you are now prepared to find an entry if it breakout out of this pennant. Step #5 The Breakout. Ah yes… The best part of this strategy is seeing that price breakout of the pennant you drew on the chart. **Note Since this is a Bearish Pennant the price will need to breakout of the bottom of the pennant. If this were a Bullish Pennant, you would have needed to see the price breakout above. If the price breaks above the pennant, I would not enter a trade based off of the rules of this strategy. However, there are strategies you can use to trade this but for the PPG trade strategy if the prices break above the pennant in a bearish pennant then avoid trading. The same goes for a bullish pennant. If it breaks below the pennant, then do no take the trade. After Breakout, Make The Trade with this Pennant Forex Strategy. #1 Enter on breakout candle close. #2 So once the price breaks out of the pennant, you are technically safe to make a trade if it’s a strong breakout candle. This is a great place to trade because if the trend continues you are in a great place to be! Note** (This is the advanced entry position) The reason is that this is advanced is that it takes more of a price action analysis that beginner traders may not know what to be looking for. #3 Another place you could make your entry is when the price breaks the top of the pennant. (For beginner traders I recommend this entry position) All you do is draw a horizontal line at the bottom of the pennant, and once the price action breaks this you make a sell entry: Step 6 To place you stop loss, determine a support/resistance area and place in below this in a buy trade or above this area in a sell trade. Step 7 The price should move rapidly, and you should be in profit in a short period. The rule of thumb with these pennant patterns that the second breakout will move as far as the first. The first bullish trend, as you recall me saying, moved 78 pips in 3 hours. So we technically could shoot for another 78 pip move. Always be mindful of price action when you are in a trade, though. Personally, I stay in a trade with this strategy until I see price action consolidating by analyzing Parabolic SAR and studying the price movement. That is what’s nice about the Parabolic SAR. When you see something like that (5 consecutive dots), you can have a good idea as to what the trend may do shortly. If you spot this occurring and you see price action consolidating then consider a trailing stop, or exiting the trade altogether. Today we want to take a look at a great pennant forex trading strategy. You will learn what a bullish pennant and what a bearish pennant is and how to make a pennant flag. This strategy similar to our breakout triangle strategy we have developed a while back, but only this strategy trades distinct flag pattern technical analysis. You see above that the “pole” if you want to call it that had a strong upward movement (nearly verticle). The buyers then began to close their positions and made the trend stall and form what’s called a pennant pattern. Some sellers got in before new buyers made entries and eventually kept the main trend going to the upside. This is essentially what happens every time a pennant pattern is formed. There are two types of pennants that form on charts: 1. Bearish Pennant= This bearish flag is formed after there is a strong downtrend (nearly verticle). The sellers close their positions to and take the profit. This consolidation will then lead to other sellers getting on board and, hence, the price will again be pushed down. 2. Bullish Pennant= This bullish flag formed after there is a strong uptrend (nearly verticle). The buyers close their positions to and take the profit. This consolidation will then lead to other buyers getting on board and, hence, the price will again be pushed up. Once the price breaks either of these “pennants”, you most likely want to get on board and trade these because the price is ready to take off and continue the main trend due to all the sellers/ buyers getting in at the same time. We discussed this in our other article that talks about traders making trading decisions at certain places on the charts. Think about it, everyone is looking at the same charts and are seeing the same thing. When a breakout occurs, everyone sees this happen and makes a trade decision. Also, read about Scaling in and Scaling out in Forex. The PPG trading strategy uses a few elements to help you determine a trade entry: Parabolic Sar Indicator Lines Drawn By You Price Action Analysis You can trade this strategy on any time frame. I prefer trading this on 30 min time frames and up but this still can work on 1m-15 minute charts.
Short
by Tradingstrategyguides
2
LITECOIN 1D BEAR FLAGBear Flags are a range pattern and they are a repeatable trading chart patterns. Bear Flag chart patterns will have a directional bias depending on the previous incoming trend (short trade). Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern. Whatever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart). Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place. Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement. When you see descending Volume bars and descending ATR line (which indicates volatility) this shows a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern. Trade Management after there is a breakout candle close. 1 - Position size (compare volume bar to volume ma line). a - Breakout candle must be 100% of average volume for a full position size. b - If 75% of average volume then ½ position size. (To find 75% of Volume look at the charts volume settings – divide smaller # into larger # = 75%+) 2 - Enter two trades. 3 - SL for both trades will be 1.5 x ATR. 4 - 1st trade TP will be 1 x ATR. 5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price. 6 - When 1st TP hit – move 2nd trade SL to breakeven. 7 - Adjust the 2nd trade SL to follow price. *8 – After Breakout candle – if price closes back into chart pattern close trade *9 - When breakout candle is more than 1 ATR from breakout candle open. a - Enter 1st trade at candle close with ½ position size. b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open. c – Price should pullback to that pending limit order for 2nd trade.
COINBASE:LTCUSDShort
by Tradingstrategyguides
S&P 500 E-MINI FUTURES BEAR FLAG SHORT TRADEBear Flags are a Range pattern which is a repeatable trading chart patterns. Bear Flag chart patterns will have a directional bias depending on the previous incoming trend (short trade). Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern. Whatever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart). Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place. Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement. When you see descending Volume bars and descending ATR line (which indicates volatility) this shows a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern. Trade Management after there is a breakout candle close. 1 - Position size (compare volume bar to volume ma line). a - Breakout candle must be 100% of average volume for a full position size. b - If 75% of average volume then ½ position size. (To find 75% of Volume look at the charts volume settings – divide smaller # into larger # = 75%+) 2 - Enter two trades. 3 - SL for both trades will be 1.5 x ATR. 4 - 1st trade TP will be 1 x ATR. 5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price. 6 - When 1st TP hit – move 2nd trade SL to breakeven. 7 - Adjust the 2nd trade SL to follow price. *8 – After Breakout candle – if price closes back into chart pattern close trade *9 - When breakout candle is more than 1 ATR from breakout candle open. a - Enter 1st trade at candle close with ½ position size. b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open. c – Price should pullback to that pending limit order for 2nd trade. d – If Price returns back into chart pattern close trade before SL is hit.
CME_MINI:ES1!Short
by Tradingstrategyguides
CRYPTO INVERTED HAMMER/SHOOTING STAR STRATEGIES This is the Shooting Star version of the strategy. Inverted Hammer just opposite. Step #1: Attach the Chaikin Money Flow Indicator on your Preferred Time Frame Start first by preparing your charts ready for the battle. Simply attach the Chaikin Money Flow indicator on your favorite time frame. This is the only additional technical tool we’re going to use to confirm the validity of the bearish shooting star pattern. Using the CMF indicator, we accomplish one major thing. The validity of the bearish shooting star will be confirmed or invalidate instantly as soon as the bearish inverted hammer develops on our Bitcoin candlestick chart. This means that the price won’t move any further from the ideal entry price. Step #2: The Shooting Star Candle should come after a strong bullish trend The location, or where the shooting star candlestick develops, matters a lot. This whole ingredient is what makes the bearish shooting star candle performs with such a high degree of accuracy. We need a strong uptrend that has two important features: The first part of the trend is a slow and steady move to the upside The last part of the uptrend, prior to the shooting star candle, needs to be more volatile. Basically, we’re looking for a full-blown market top where the bulls are exhausted and reach a climax point. Step #3: The CMF indicator must be below the 0 lines once the bearish shooting star candle develops Chaikin Money Flow is a great tool to read and measure institutional accumulation-distribution activity in any market. Basically, a CMF reading below the zero line shows that the sellers have the upper hand and they took control of the market. Notice that the bearish shooting star spotted satisfies all the requirements of a bearish inverted hammer. The shadows are at least two times longer than the body, small body, and very little lower shadow. This candle would have been more powerful if the closing price is below the opening price. But it’s still a good pattern to trade due to all the other features. Now, it’s time to highlight how to find the right entry point for bearish shooting star candlestick. Step #4: Sell once we break the low of the Shooting Star Candle Simply place a limit sell order below the low of the shooting star. Nothing complicated about our entry strategy. It’s in line with the textbook rule. Step #5: Hide SL above the high of the Shooting Star Candle. Simply hide your protective SL above the high of the shooting star pattern. You can add a buffer of a few pips if you wish to protect against possible false breakouts. The full-blown top creates the necessary space where the bears would find no level of support to stop the drop. The last stage of a trend has been always more volatile. When combined with the reversal shooting star pattern, it makes for a killer trading strategy. Step #6: TP when we get inside the slow part of the prevailing trend. In this regard when the price reaches the portion where the prevailing uptrend was moving slow, we take profits. That’s where the price will find some hostility to advance further on the downside. We want to clear out our position when that happens. Conclusion – Best Shooting Star Strategy The best shooting star strategy is one of the most reliable and efficient ways to trade trend reversals. This single candlestick pattern can offer you one of the most attractive risks to reward ratios. You can risk between 10 and 30 pips and look to gain between 200 and 300 pips which gives you a profit of 20x or 30x the risk taken. Take that into consideration next time when you’re able to find a shooting star candle that satisfies all the rules outlined in this trading strategy guide. A lot of traders will warn you against reversal trading. However, finding tops in the market and trading reversals can be done successfully if you have a proven methodology like our shooting star candle strategy.
COINBASE:ETHUSDEducation
by Tradingstrategyguides
1
EURUSD 1H RENKO CHART STRATEGY #2The second simple Renko Trading Strategy system is an indicator based strategy that uses price-momentum divergence to identify trend reversals. Renko Trading Strategy #2 For this Renko trading strategy, we only need to use the RSI indicator. We can use a 14- period or a 20-period RSI indicator. So, use the same period as the ATR 14 or 20 Renko brick size. After we spot the momentum divergence an entry signal is triggered once we get a reversal. On the Renko chart, a trend reversal is set in motion once the brick changes color. In this case, when we spot a bearish divergence, enter a short position after the brick turns red. For bullish divergence, wait for the brick to turn green. We exit our profitable trade once another reversal pattern is formed in the opposite direction of our trade. As a method to protect our account balance and not lose too much, you can place your SL above and below the swing point developed after your entry. A lot of the noise inherent in regular time-based charts are eradicated. So, if you trade with Renko charts, spotting divergence and trend reversals are a lot easier. The RSI is the best indicator to use with Renko. Read the previous Renko Chart post to learn about Renko chart system.
Education
by Tradingstrategyguides
1
EURUSD 1H RENKO CHARTRenko Trading Strategy #1 This profitable Renko strategy you can use is to focus only on the bricks. No additional technical tool is required for this system. We’re going to explore a very simple and yet very powerful Renko chart pattern that incorporates the wicks. This Renko price pattern looks for two consecutive bricks of the same color and both bricks have wicks. The location of this Renko pattern doesn’t really matter. It can be at the end or middle of a trend. This pattern has a very high rate of success if traded in the right context. You have to look around these two brick patterns and make sure the blocks are not moving back and forth within a trading range. If that’s not the case, then you have a green light to take the signal generated by this trade setup. The entry is on the third brick after the two bricks that have wicks. The stop loss can be placed above the wicks and exit once a reversal pattern is produced. Conclusion – Renko Trading Strategy Renko bars ensure that you have a cleaner and neater representation of price action. If you’re having a hard time reading the price on a candlestick chart, maybe it’s time to look in another direction. Trading with our profitable Renko strategy can be the perfect fit for you. We truly believe that Forex Renko charts are more suitable for traders who still struggle to analyze a candlestick chart. The Renko trading strategies presented through this trading guide are just an introduction into the world of Renko bricks. We hope you now have a clear idea of what the possibilities are by using this new charting technique. When you’re actively trading the markets (scalping, day trading) it’s important to have a methodology to clear out the market noise. The Renko trading strategy is time-independent and gives you an eccentric way to view price action. Even though the free Renko charts can be used across different asset classes, including cryptocurrencies our simple Renko system is designed, but not limited, to be used in the Forex market. What are Renko Charts? A Renko chart is a technical tool or a type of chart that is built by only using price data. Unlike the Japanese candlestick charts, which are built using price, time and volume, the Renko chart only measures price movement. Renko has no time dimension. Renko charts are not some long-hidden secrets dating back to feudal Japan times as some trading gurus would like you to believe. Renko bars were actually developed several decades ago. The name Renko means brick in Japanese and comes from the word “renga.” These charts are sometimes referred to as brick charts by traders. Steve Nison who is the father of modern candlestick charting is the man who actually made Renko charts forex known to the general public. These charts are often compared to traditional candlesticks but have some key differences. While candlestick charts have varying lengths of “wicks” throughout, Renko bricks are all the same size. The simplified bricks found in Renko charts make it easier to read the market and make quick decisions. These charts are ideal for day traders, though they can be used by traders using any timeframe. By removing the noisier parts of the candlestick chart that apply to longer-term trading strategies, Renko charts make it possible to determine where the market is actually moving. Every candlestick on the Renko chart is called a brick because it has the shape of a building brick. The rectangular bricks used for building walls are about the same size. The same goes with Renko charts; every brick is the same size. The size of a Renko brick is pre-determined by the user. How to Read and Build a Renko Trading Chart Reading a Renko chart is simple. Because the bricks have a fixed size, they can all easily be compared to one another. The color (and direction) of the Renko brick will change once the value of the previous brick has been exceeded. This indicates to traders that trends are changing and that the price is likely to swing in the opposite direction. Each brick represents a price range (example – $0.25). However, while the bricks are evenly sized within the same graph, they can be adjusted to your trading objectives. Individuals opening and holding longer, high-cap positions will use different brick sizes than penny stock day traders. We recommend using the average true range—or, ATR for short—in order to construct each brick. The ATR is derived from the closing price of the stock. This means that a Renko chart is a lagging indicator. In the next step, we will show you how to read Renko bars. Note #1: if you use Renko bars with wicks or tails, then some bricks may display additional wicks either at the top or the bottom of a brick. But the brick size remains the same. On the Tradingview charting platform you can go to Chart Settings – Style – Wick, and select which way you want the bricks to be displayed, with or without wicks. Before returning to the Renko bricks with wicks, let’s give you the basics or the foundation of a Renko brick. We already established that the brick size is pre-determined by the user. If you’re trading with Renko charts, and your preferred brick size is 20 pips, then bricks only form when price moved either up or down by 20 pips. The best way to illustrate this concept is to look at Renko blocks through the eyes of the candlestick charts. In the EUR/USD 5-minute candlestick chart below, we highlighted areas of 20 pips worth of price movement. A green Renko brick would form only after the price will advance 20 pips. Conversely, a red Renko brick would form only after the price declines 20 pips. As you can tell, the time intervals between each brick are inconsistent. It’s clear that Renko is less noisy and cuts through a lot of the noise between the swing low and swing highs. Important note: When you trade with Renko charts, the price needs to travel double the price distance of your brick size in order for the Renko brick to change color. For example, if the brick size remains 20, it means that we need to actually move 40 pips for a red brick to be printed after we had a green brick. Let’s return for a second to why some blocks have wicks? Trading Renko charts with wicks can be a very powerful tool in your trading arsenal. Bricks with wicks give us further clues on the battle between the bulls and the bears. A wick is printed on a Renko brick only when there is a strong attempt to produce a reversal (a change of brick’s color from green to red and vice versa), but it fails. The wick will simply show you how many pips it went in the opposite direction. Note #3: a wick is printed on a brick only when the price moves in the opposite direction of the previous candle by at least the length of the brick size +1. Let’s see how you can optimize the Renko block, and how to choose the right Renko brick size. How to choose the right Renko Brick Size? If you don’t know what the right size for Renko charts is then, we have a solution. If we want a dynamic reading of the price through the Renko blocks, we can use a brick size that is determined by the ATR (Average True Range). Instead of picking a random brick size, this will give you dynamic support and resistance levels that are more accurate. The ATR will automatically detect the right brick size that is more in tune with the price action. Note #4: The disadvantage of using an ATR based Renko chart size is that when the ATR value changes, your Renko bricks are redrawn again to reflect the new changes. When selecting your Renko brick size, ask yourself the following questions: What are my objectives as a trader? What are my time constraints? What is the cost of trading? Am I opening small positions or larger positions? Do I consider myself risk-tolerant or risk-averse? If you are pursuing large, lower-risk positions over longer periods of time, then it will make sense to use a larger Renko brick size. On the other hand, if you are pursuing high-risk positions that require paying close attention to volatility, then smaller bricks will be better.
Education
by Tradingstrategyguides
2
BTCUSD 1D ASCENDING TRIANGLE LONG TRADEAscending TriangleS are repeatable trading chart patterns. Ascending Triangle chart patterns will have a directional bias depending on the previous incoming trend. (Long) Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern. Whatever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart). Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place. Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement. When you see descending Volume bars and descending ATR line (which indicates volatility) this shows a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern. Trade Management after there is a breakout candle close. 1 - Position size (compare volume bar to volume ma line). a - Breakout candle must be 100% of average volume for a full position size. b - If 75% of average volume then ½ position size. (To find 75% of Volume look at the charts volume settings – divide smaller # into larger # = 75%+) 2 - Enter two trades. 3 - SL for both trades will be 1.5 x ATR. 4 - 1st trade TP will be 1 x ATR. 5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price. 6 - When 1st TP hit – move 2nd trade SL to breakeven. 7 - Adjust the 2nd trade SL to follow price. *8 – After Breakout candle – if price closes back into chart pattern close trade *9 - When breakout candle is more than 1 ATR from breakout candle open. a - Enter 1st trade at candle close with ½ position size. b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open. c – Price should pullback to that pending limit order for 2nd trade. d – If Price returns back into chart pattern close trade before SL is hit.
COINBASE:BTCUSDLong
by Tradingstrategyguides
AUDUSD 1D BEAR FLAG SHORT TRADEBear Flags are Channel Range patterns that are repeatable trading chart patterns. Bear Flag chart patterns will have a directional bias depending on the previous incoming trend (short). Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern. What ever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart). Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place. Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement. When you see descending Volume bars and descending ATR line (which indicates volatility) this shows a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern. Trade Management after there is a breakout candle close. 1 - Position size (compare volume bar to volume ma line). a - Breakout candle must be 100% of average volume for a full position size. b - If 75% of average volume then ½ position size. (To find 75% of Volume look at the charts volume settings – divide smaller # into larger # = 75%+) 2 - Enter two trades. 3 - SL for both trades will be 1.5 x ATR. 4 - 1st trade TP will be 1 x ATR. 5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price. 6 - When 1st TP hit – move 2nd trade SL to breakeven. 7 - Adjust the 2nd trade SL to follow price. *8 – After Breakout candle – if price closes back into chart pattern close trade *9 - When breakout candle is more than 1 ATR from breakout candle open. a - Enter 1st trade at candle close with ½ position size. b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open. c – Price should pullback to that pending limit order for 2nd trade. d – If Price returns back into chart pattern close trade before SL is hit.
Short
by Tradingstrategyguides
5
High Net Worth Strategies - What is High Net Worth Investing?What is High Net Worth Investing? In order to understand what high net worth investing is, you need to understand what a high net worth individual (HNWI) is. A high net worth individual, as the name suggests, is a wealthy individual with at least $1 million in liquid financial assets. In the financial industry, the high net worth status is based on how a bank wishes to classify its clients. There are two characteristics that classify you as a high net worth individual: Having considerable liquid assets. Having many investable assets. As wealth accumulation increased and more and more people have become HNWI, a new class of wealthy people has been created, namely the ultra-high net worth individuals. An ultra-high net worth individual (UHNWI) is someone with at least $30 million in liquid assets. Now that you understand what it means to be an HNWI or UHNWI, let’s learn some high net worth investing strategies used by HNWI. How Do High Net Worth Investors Invest? Imagine if you could use the same investment principles as the high net worth individuals. The high net worth investors have a large amount of capital available for investing. So, how do high net worth families invest their capital? The traditional asset allocation model for high net investors is 60/40: 60% equities 40% Fixed Income (bonds) This asset allocation model provides a diversified and more balanced source of income. While it is a rule of thumb, it is still very useful. Equities will pay investors dividends, while bonds will pay investor interest. This can be considered a form of passive investing. These types of investing strategies for the high net worth investor will also benefit from stock price appreciation. At the same time, bonds offer stability and income predictability. The traditional asset allocation model of 60/40 served investors very well in the 80s and 90s, during a time when interest rates were much higher. Today, bond yields are at the all-time record low, so the traditional asset allocation model won’t work that well in the current environment. So, it’s necessary to adopt different high net worth strategies. And, that’s exactly what we’re going to discuss below: Investing Strategies for High Net Worth Investor. The high net worth investors are the type of people who know what to do if someone gives them $1 million. Ask yourself this question: If you were to inherit today $1 million, would you spend the money? Or, would you invest the $1 million? If you’re not going to spend the money, then where should you invest $1 million right now? Well, the first step is to search for the best brokers for fixed income trading for high net worth and start from there. You should also diversify your investments and seek opportunities that have enhanced return potential and favorable tax treatment. Currently, many traders are realizing the old asset allocation model is changing. Instead of using the broken 60/40 asset allocation model, traders are becoming a bit more creative and are currently experimenting with new approaches. With the new approach, the high net worth individuals are able to diversify their investment beyond the standard stocks and bond model. Here is an investing strategy for the high net worth investor that includes attractive alternatives. See below: High Net worth Strategies #1: Asset Allocation Strategies Asset allocation is the process of deciding how much of each asset class (equities, bonds, real estate and cash) you should hold in your portfolio. There is no optimal asset allocation model as it all falls back on the money managers’ ability to seize attractive risk-adjusted return opportunities. For example, a typical high net worth asset allocation model looks something like this: 50% equities 10% infrastructure 10% private equity 10% real estate 10% hedge funds 10% fixed income The time horizon of this type of asset allocation model is much bigger. This type of investment is typically held for years. Nowadays, the Capital Asset Pricing Model (CAPM) is widely used to quantify the correlation between risk and the expected return. As the Harvard Business Review explains, CAPM sees risk and return as being decided by a portfolio exposure to market beta. Check out HERE what is Beta in trading. By combining the US stocks and global stocks into a portfolio, this will improve the risk and return relative to each of the stock selection. Compared to stocks, bonds are less risky, but they have lower expected returns. However, most stock model portfolios work well if they include growth stocks, which bring us to the next investing strategies for the high net worth investor. High Net worth Strategies #2: Growth Stocks Buying and holding growth stocks is a form of passive investing favored by the high net worth individuals. For example, if an investor has invested in Amazon stock back in 2015, the investor would have increased the investment by more than 700% by mid-2020. Growth stocks may or may not offer dividends (the certainly offer fewer dividends than blue-chip stocks), but they remain attractive because they produce returns through share price appreciation. Growth stocks also come with tax advantages because the investor is not obligated to pay taxes while holding the stock. Additionally, if you hold the stock for more than one year, your gains are taxed as long-term capital gains. The long-term capital gains are taxed at a lower rate than the short-term capital gains. We’re going to outline additional strategies for establishing asset allocation. See below: More Investing Strategies for High Net worth Investor. If you want to achieve to optimize asset allocation and minimize risk, you need to look into the different approaches that high net worth individuals use. We’re going to summarize for you five of the most common asset allocation strategies used by HNWI: 1 - Strategic asset allocation adheres to a proportional combination of assets based on expected rates of return. For example, if stocks historically returned 15% per year and bonds have returned only 5%, you would put more weight on stocks. 2 - Constant-weighing asset allocation strategy – with this approach you constantly adjust your portfolio. For example, if stocks would drop in value, you would buy more at a cheaper price. 3 - Tactical asset allocation – helps HNWI to take advantage of exceptional short-term investment opportunities. This is a type of active trading strategy. 4 - Dynamic asset allocation – this is another type of active trading strategy that helps you adjust your portfolio as markets rise and fall. For example, if the stock market is showing weakness or the economy is entering a recession, you sell stocks in anticipation of a drop in the stock price. 5 - Insured asset allocation – this approach is more suitable for the risk-averse investor because it seeks to protect the portfolio value by not allowing it to drop below a certain threshold. That pretty much sums up how the wealthy stay wealthy and can become even wealthier. The bottom line is that asset allocation is not an exact science and it all depends on your financial goals and experience. What you can do as a small investor is to diversify your portfolio. While you might not have the money to buy real estate and a good amount of stocks, you can seek alternative investments. For example, you can trade stocks, ETFs, currencies and another part of your money to be allocated to cryptocurrencies. Let’s now see how the ultra-rich invest their money. Are ultra-high net worth strategies different from high net worth strategies? Generally, they are similar, but there are still a few important details to pay attention to. See below: Ultra-High Net Worth Investment Strategies. A new breed of investors evolved among high net worth individuals and these are the ultra-high net worth investors. As explained above, UHWIs are defined as having investable assets of at least $30 million. So, where do the ultra-rich invest their money? According to the Wealth Report Attitudes Survey 2020 (see figure below) the UHNWI asset allocation model is more diversified. The Wealth Report revealed that the average UHNWI investment portfolio was invested in each asset class as follows: 27% in real estate. 23% in equities. 17% in bonds and fixed income. 11% in cash (currencies). 8% in private equity. 5% in collectibles (including art, antiques, and other expensive items). 3% in gold and precious metals. 1% in cryptocurrencies (Bitcoin and altcoins). We can note that there is an increased interest in investing in the long-term, which is the case for real estate investments. Additionally, you can see that 11% of the wealth is held in cash, which means UHNWIs are active in the forex market as well. Currency trading for high net worth individuals is again done over the long term. Now, how the average investor can invest like a billionaire? Ray Dalio an American hedge fund manager said: “It’s more difficult to succeed in the markets than it’s to succeed in the Olympics” For more trading quotes, please see Top Trading Quotes of all Time. While everyone is saying it’s difficult to succeed in the markets, it’s not impossible. And, trading like a billionaire is a different ball game altogether. If you want to replicate the ultra-high net worth investment strategies and be a billionaire someday, these are the 10 things you should be doing: 1. Invest only in what you know. 2. Understand the difference between price versus value. When the price is well below the stock value than it’s the best time to buy a stock. 3. Identify cheap investments (e.g. high net worth cryptocurrency trading). 4. Invest in durable time tested businesses. 5. Research the team management team behind a company. 6. “Be fearful when others are greedy and greedy when others are fearful” from Warren Buffett wisdom. 7. Develop a long-term mindset. 8. Invest in Warren Buffett’s Berkshire Hathaway stock, which has outperformed the S&P 500 for decades. 9. Invest in overseas stocks. 10. Diversification. These investing principles can help you invest your $10,000 like an ultra-high net worth investor. Final Words – High Net Worth Strategies In summary, when you’re a high net worth investor managing your wealth can be a challenge. The HNWI don’t invest like the average investor, they use ultra-high net worth investment strategies to accumulate more wealth. The investing strategies for the high net worth investor that have produced the most profits are the ones that are sufficiently diversified. Diversification is key to how wealthy people preserve their wealth and accumulate more wealth. You can too invest like a wealthy person if you start using the principles outlined through this high net worth strategies guide. Thank you for reading!
NASDAQ:EQRREducation
by Tradingstrategyguides
EURUSD 4H PIN BAR SHORT TRADE STRATEGYBasic Guidelines: Timeframe – ANY Market – ANY Indicators – NONE OTHER – Trend lines, horizontal lines, support resistance lines (anything to help you find these areas). Step 1: Find a Pin Bar On Your Chart. *Note This is a stock price action strategy, and a forex price action strategy. I will use a currency pair as an example. Price action charts are with any market and timeframe. First, identify a pin bar that has formed. In the example, this is considered a bearish pin bar because of the long wick above the body. As you can see, the pin bar “wick” is above the body, which is considered a bearish pin bar. In this case, we are looking for a downtrend bounce of the top of the range. This is a 4 hour time chart EURUSD currency pair. You can see the Bears tried their hardest to stop this uptrend from occurring. The Bears were too strong, which is why you see the pin bar form. This is a perfect example of a pin bar price action reversal setup. Step 2: Look for Past Price Action to Determine Why The Pin Bar Formed. Why did the reversal suddenly hit a price, and then continue to the downside? We can see price has been in a range pattern for quite some time. Note** you can either look at the current time frame you are on, in this case, a 4-hour time period. Or you can bump up or down one or two periods to gather information. Resistance in the past can mean support in the future. What happened is the price hit this level but failed to break through it. Since the long bullish wick formed, we decide it is time to enter this trade based on what we learned from the prior days. This is what Price Action is all about. No two trades are the same. However, we can take what we’ve learned from the past. Then make the best judgment as to where the price is going in the future. You are essentially like a detective when you trade price action. The point is to gather many pieces of evidence to back up your conclusion. You are trading with confluence. Sometimes simple is best. Study the charts and form an educated conclusion as to where the price will go. Step 3: Trade entry You just enter the trade 2-3 pips from the break of the nose of the pin bar. Step 4: Stop loss Place the stop loss 3-5 pips away from the wick. The end of the wick will be a support area. So if this is broken the trend may continue downward. Which is why you place your stop 3-5 pips away from this. Step 5: Exit Strategy Your exit strategy is when you hit the first level of support or resistance on your chart. As you can see, the price hit a point then stalled out. Once we see the price action stalling out, we exit the trade immediately. Conclusion – Price Action Pin Bar Strategy Price action is another fundamental element to learn when trading the market. There are thousands of strategies you can use with price action. It is important to find something that works for you. These pin bars are hard to miss. They are relatively accurate when you learn why a pin bar formed. Pin bar candles are shown in any time frame. The rule of thumb is, the higher the time frame, the stronger the signals. But that does not mean that this will not work on a five-minute time frame. Do not trade every pin bar you see that forms. Gather up key information from the charts. Then form the best conclusion to determine if you should enter the trade based on the rules.
Education
by Tradingstrategyguides
5
CRUDE OIL 1D BEAR FLAG SHORT TRADEBear Flags are a Range pattern and they are a repeatable trading chart pattern. Bear Flag chart pattern will have a directional bias depending on the previous incoming trend. Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern. Whatever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart). Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place. Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement. When you see descending Volume bars and descending ATR line (which indicates volatility) this shows a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern. Trade Management after there is a breakout candle close. 1 - Position size (compare volume bar to volume ma line). a - Breakout candle must be 100% of the average volume for a full position size. b - If 75% of average volume then ½ position size. (To find 75% of Volume look at the charts volume settings – divide smaller # into larger # = 75%+) 2 - Enter two trades. 3 - SL for both trades will be 1.5 x ATR. 4 - 1st trade TP will be 1 x ATR. 5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price. 6 - When 1st TP hit – move 2nd trade SL to breakeven. 7 - Adjust the 2nd trade SL to follow price. *8 – After Breakout candle – if price closes back into chart pattern close trade *9 - When breakout candle is more than 1 ATR from breakout candle open. a - Enter 1st trade at candle close with ½ position size. b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open. c – Price should pullback to that pending limit order for 2nd trade. d – If Price returns back into chart pattern close trade before SL is hit.
NYMEX:CL1!Short
by Tradingstrategyguides
1
EURCAD 1D BULL FLAG LONG TRADEBull Flags are ranges that are repeatable trading chart patterns. Bull Flag Range chart patterns will have a directional bias depending on the previous incoming trend. Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern. Whatever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart). Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place. Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement. When you see descending Volume bars and descending ATR line (which indicates volatility) this shows a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern. Trade Management after there is a breakout candle close. 1 - Position size (compare volume bar to volume ma line). a - Breakout candle must be 100% of average volume for a full position size. b - If 75% of average volume then ½ position size. (To find 75% of Volume look at the charts volume settings – divide smaller # into larger # = 75%+) 2 - Enter two trades. 3 - SL for both trades will be 1.5 x ATR. 4 - 1st trade TP will be 1 x ATR. 5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price. 6 - When 1st TP hit – move 2nd trade SL to breakeven. 7 - Adjust the 2nd trade SL to follow price. *8 – After Breakout candle – if price closes back into chart pattern close trade *9 - When breakout candle is more than 1 ATR from breakout candle open. a - Enter 1st trade at candle close with ½ position size. b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open. c – Price should pullback to that pending limit order for 2nd trade. d – If Price returns back into chart pattern close trade before SL is hit.
Long
by Tradingstrategyguides
1
USDCHF 4H DOUBLE TOPStep #1: Identify the Phase of the Market. The Double Top reversal needs a uptrend. Just because you can spot the reversal it doesn’t mean you have to jump in willy-nilly. Remember, we need the right context and everything needs to line up for a trade-able setup. So, the first step is to identify the phase or market condition. At any given moment the market can be trading either up, or down, or it can go sideways. Establishing the phase of the market aka identifying the trend is probably the biggest ingredient that can determine the success rate of double bottom pattern technical analysis. Step #2: The historical precedent. An A++ Double Top Reversal is composed of 2 Rounded Tops The second step of the Double Top is to find what we call the historical precedent or a chart pattern. We don’t want to make a trading decision without price confirmation, and in our case, we use the reversal pattern. You need to identify two rounded tops in order for the pattern to be considered trade-able. But, what is a rounded top? In technical analysis, a rounded top is simply a price formation that typically occurs after an uptrend, prices move upwards and then quickly rallies creating a rounded top. Now, of course, that depending on the structure the rounded top will vary in size and magnitude. But the idea is that we need a quick move up followed by a quick move down to define a rounded top Note* A valid double top reversal has two rounded tops. Step #3: Allow a maximum of 10 pips variation between the two tops. Don’t seek perfection, because in trading you need to get rid of your idealistic mindset as the pattern will not look perfect all the time, so be flexible. This is the reason why we need to allow a maximum of 10 pips variation between the two tops. The probability of two tops happening at the same exact price level is almost impossible. Now, we to determine an entry technique for our chart pattern strategy. Step #4: Sell when Double Top breakout candle closes below the neckline. After we identify the phase of the market and the characteristics of a good reversal we need to wait for confirmation that momentum is shifting. The breakout candle is our signal that the momentum has shifted and it’s what it confirms and validates the double top pattern. You’ll see the double top breakdown happen over and over again, but it’s important to analyze them within the context of the market trend. The next logical thing we need to establish for the strategy is where to take profits. Step #5: Take Profit at the same price distance as measured from the highest peak to the Neckline The minimum profit target for this type of trade is approximately equal to the same price distance as measured from the double top to the neckline. If we project the same price distance to the downside we obtain our first take-profit zone for the strategy. The double top pattern can produce a major reversal so we advise you to be very flexible with your profit target not to miss any big profit opportunity. Step #6: Place the protective stop-loss slightly above the resistance created by the Double Top reversal The Double Top chart pattern strategy gives you a simple way to quantify risk because you can place your protective stop-loss slightly above the double top pattern. The double top pattern really gives you the opportunity to also trade with a tight stop loss, which is great as we always want to keep losses at a minimum. Note*** The above was an example of a SELL trade… Use the same rules – but in reverse – for a BUY trade, but this time we’re going to use the double bottom pattern. Conclusion There is no other chart pattern that illustrates the trend reversal. However, despite the high success rate you still need to use a protective stop loss and to wait for the breakout when trading with the double top chart pattern strategy. You can also trade with the breakout triangle strategy. The bottom line is that you still need a plan to successfully trade the double top breakout. Our double top chart pattern strategy should answer all your questions in regard to how to make money with this simple pattern.
Education
by Tradingstrategyguides
2
EURUSD 1D/4H/1H PARABOLIC SAR SHORT TRADE SETUPRule #1- Apply Parabolic SAR system and Moving Average indicators to chart. You can choose different colors for the moving averages. The 20 period moving average is Blue and the 40-period moving average is Red in this example. Rule #2- The Parabolic SAR Indicator must change to be above price candle. Notice how the dots were below the price. The parabolic stop and reversal (SAR) formula showed us that the price stalled out for a few hours and then the dot appeared above the candle. This is a sign that a reversal may be forming. Rule #3- Another element that must occur is the moving averages must cross over. In a short trade, the 20 period moving average will cross and go below the 40 periods moving average. So now the 20 period moving average is below the 40 period moving average. However, something occurred that is notable. The dot may appear below the price candle. Since the moving averages are telling us that a downtrend is most likely going to occur, we will wait until the dot appears again above the price candle to validate this reversal and enter a trade. Rule #4- Parabolic SAR dot must be above price candle AND moving averages cross to where 20 period MA is below 40 period MA. Note** One of these elements may occur before the other. The reversal dot can appear before the MA lines cross. Or the Moving averages can cross before the reversal candle. As long as there are both elements, the entry criteria are met. Rule #5- Enter The Next Price Candle… Enter (SELL) the very next price candle after the dot appears above the candle. You can see on our chart where we entered the trade. Waiting for one candle after makes sense because this proves to us that this reversal is strong. The moving averages are supporting the downtrend + the dot is signifying a downtrend. Rule #6- Stop loss / Take Profit The stop loss you will place 30-50 pips away from your entry. Always look for prior resistance or support to determine a stop loss. In our example, a stop loss was placed 40 pips from entry. Your exit criteria are when the 20 and 40-period lines cross over again. OR when the dot reverses appears at the bottom of the candle. Some will get out of the trade when the dot appears below the price candle. So basically you can use either exit strategy. This trade the downtrend was very strong so we stayed in until the MA lines cross. Determine where you are in a trade. If you are up +100 pips and the dot changes to reversal consider getting out then and taking your profit. Rules for Long Entry. Rule #1- Apply indicators to chart Rule #2- Dot must change to be below price candle. This is a sign that a reversal may be happening. Rule #3– Another element that must occur is the moving averages must cross over. In a long trade, the 40 period moving average will cross and go below the 20 period moving average. Rule #4- Dot must be below price candle AND moving averages cross to where 20 period MA is above 40 period MA. Note** One of these elements may occur before the other. The reversal dot can appear before the MA lines cross. Or the Moving averages can cross before the reversal candle. As long as we have both elements the entry criteria is met. Rule #5- Enter Next Price Candle. Enter the very next price candle after the dot appears below candle + MA lines cross and 20 period MA is above 40 period. Rule #6- Stop loss / Take Profit The stop loss you will place 30-50 pips away from your entry. Always look for prior resistance or support to determine a stop loss. Your exit criteria in the example below were when the dot appeared above the candle. Note** Scalpers should not be using a 30 to 50 pip stop with this strategy. Consider your rules and adjust accordingly. A 5-10 pip stop may be more appropriate on that low of a time frame. If you like this strategy and have a stop you think works best, leave us a comment below and tell us what you think! Conclusion As stated the Moving Average Trading Strategy can be used on any time frame. However, you should always check different time frames and look at what the market is currently doing. No strategy can give you a 100% win ratio so always be placing your stops at the appropriate areas. I would recommend practicing making both short and long trades with this moving average trading strategy. Reversal Trading Strategy In this article, you are going to read about a trading strategy that teaches you how to use a parabolic SAR indicator (Stop And Reversal) trading tool, along with two moving average trading strategies to catch new trends on the reversal. This moving average and Parabolic SAR trading strategy will show you how to use the parabolic SAR indicator effectively and how you can add this trading system into your daily trading techniques. The Parabolic SAR (PSAR) is an indicator favored by technical traders that captures reversal signals. The Parabolic SAR (Stop and Reverse) was developed by J. Wells Wilder. Wilder was a mechanical engineer best known for his technical analysis developments. He has also developed the DMI (Directional Movement Index), the RSI (Relative Strength Index), and other indicators dear to technical analysts today. Hopefully, by the end of the article, you will have the right parabolic trend formula, learn what a crossover is, find out buy signals, the best moving average crossover for swing trading, best moving average crossover for day trading, and the best moving average crossover for scalpers. Also, read the hidden secrets of moving average. The strategy is a dynamic trading tool that is used by many professional traders of every market (Forex, Stocks, Options, Futures). It is best used when the market is trending. If the market is choppy, the market is moving sideways, this tool does not particularly work at its best. This was developed by Welles Wilder when he introduced this into his book in 1978 that was titled, “New Concepts in Technical Trading Systems.” What this tool basically does is helps traders determine when the current trend will end, or when it is about to end. The way it shows you this is by placing dots that show up above or below the price candle. They appear above or below the current candle for a specific reason. If the dot is above the candle it will be a SELL signal or downtrend. However, if the dot is below the candle this can be a signal to BUY or an uptrend. When the change occurs (the dot goes from below to above the next candle) this indicates a potential price reversal may be happening. Some may think why not just trade the dots. When it reverses, just make an entry at that price. Technically you can trade like this and may win some, but this is a very risky way to trade this indicator. You need other tools to validate this potential trend. Which is why we use this indicator and two moving averages to determine an entry point. The moving average trading strategy will help verify that a reversal is in fact occurring. The combination of these indicators will give you accurate trend reversal setups. This strategy can be used on any time frame on your chart. So day traders, swing traders, and scalpers are all welcome to use this type of strategy. Here are the indicators you need to apply on your chart to use this trading strategy: Parabolic Sar strategy: Default Settings 40 Length Moving Average= Green color in our example 20 Length Moving Average= Red color in our example
Short
by Tradingstrategyguides
1