Sometimes I enter a trade too early then stoploss is hit before price even moves in the direction I want. How do you plan your entry points? How do you know when it’s the perfect time to enter?
2 Likes
Only years of experiencing chart patterns and price movement increase the probability of you getting it right. If it was easy, we’d all be millionaires, wouldn’t we? The same applies to exit points which is even more critical to whether you make a profit or loss.
One indicator I find useful in identifying entry - and exit - points is MACD histogram setting at 3 -10 -16 where it shows when trends are strong and weakening - and vice versa. Using PSAR balls setting as 0.09 - 0.5 as a confirming signal is all you need to probably hit the right candle spot.
A third check is to view what’s happening on a lower time frame, that could affect your trade positioning as being eligibile, or to wait and see.
3 Likes
The simplest chart pattern, the pattern which is most easily understood by most people, is an uptrend. When price is consistently rising, the correct direction for your trade is long. A valid place to set a buy order would be not far below the recent prices. This is a historic trading style called buying the pull-backs.
You can improve it a little by buying as price recovers from a recent low and heads back up strongly again to continue the uptrend. This makes sure you don’t buy when price is going down because it might not stop. You can enter on a recovering price by either watching and waiting or by pre-setting a buy order.
4 Likes
This removes emotion from entry. If you set your entry, SL, and TP all at once, you literally just have to wait. There’s nothing else. Either your idea was valid or it wasn’t. That’s it.
For a while, these were my favourite trades.
As far as the right entry, it all depends on your strategy.
You’ll have to backtest, analyze charts, and practice live until you figure out what works.
An entry signal for me could be an exit signal for someone else.
Sorry if my answer’s vague. But entry and exits all depend on your strategy.
1 Like
By the way, you NEVER know when the perfect entry is. Just because you enter doesn’t mean your stop won’t get hit.
You NEVER know when your stop could get hit. That’s why risk management is so important. Never exceed 2% of your account per trade. Some say 1%.
You never know which trade could be wrong. That one time you’re sooooo sure where price will go, and you bet half your account because you’re ready to move out of your flat and into a mansion…you’ll be wrong, sad, and full of regret.
Practice risk management. You can rush the learning process, but never the margin growth.
2 Likes
I trade 1/2 a month and use a 1: 3 risk ratio in that trade. I target 150 pips with a big lot size. This trade became my monthly income.
No one ever knows the correct entry point. It can always be late or early. But you need to try to do so that the entry point is correct. And this is achieved by prescribing entry rules. Then you need to work out the entry rules, get statistics, and then adjust the entry rules. After that, the number of correct entries will be, for example, 6 out of 10.
the starting point will depend only on yourself and on your initial level of training in forex
That makes perfect sense to me. Just follow the trend. No over complicating things.
I agree. Exceedingly complicated strategies tend to be unnecessary - there are more opportunities to make a mistake.
1 Like
Simply Wait for your “entry” to be confirmed as price develops in your favor then enter at the next entry point you don’t need to be perfect. Perfection will evade you so be happy with enough. Message me with any questions.
Indicators are nice but not the end all be all look at the OHLC of each duration of time there lies the holy grail. Happy trading
1 Like
Thanks man. I’ll check these out and see how it works out for me.
Makes sense. Thanks.
1 Like
The simplest advice I can give, NOBODY KNOWS, there is no prophet who says it’s time for ###/### to go in mixm’s direction. The best advice I can give you is study reversal / continuation candlestick patterns. The most powerful are the shooting star / hammer, engulfing, morning / evening star. Once you’ve learnt all that don’t forget structure is #1 and momentum is your enemy! Anyone else have any favourite confirmation patterns?!
1 Like
The markets keep moving whether we retail traders are in or out.
Technical analysis will not tell you whether your next trade will be a success or not but will instead tell you that over a series of trades, you’ll make money.
Sit tight, forget your current trades and look at the next dozen or twenty trades.
I hope this helps…
1 Like
Focus on the uptrend, that’s what will tell you where to make your entry point.
1 Like
How to choose the entry point, and what are the disadvantages of choosing the wrong entry point?
If you are struggling with entries and are live first thing I suggest is go back to demo. Learn how to identify trends and then (depending on the style you learn) how to spot confluences for entry. Ideally you want to look for a few confluences that stack the probabilities in your favour. Combine that with a solid risk management strategy and if you are wrong you lose 1% let’s say. But as someone above mentioned, look to enter high probability trades (based on confluences) and trades that have a 1:2 or even 1:3 risk to reward.
Also by using a demo spend some time focussing on just buys and then some time on just sells. Most of us have a preference and you can check the stats to see what yours is. It might be that you have a better eye for buys than sells. If that’s the case focus on that. Or you can try methods to train yoruself to better spot sell entries.
2 Likes
You can choose the entry point by using the history of the prices, but be aware that it is not always easy to do this.