i don't answer EVERY SINGLE beginners question. Actually out of every 10 i probably answer like 2 or 3 LOL
but, You're Welcome anyway,
Not Really, i mean, if you've done this for 7 years and (as a programmer you can understanding this) and if you've STUDIED THE CRAP OUT OF IT. its not really that amazing to think i will be right at least 6 times out of 10, but it's actually a lot higher than that
Now.. what i do is i trade longer term, , Days, Weeks, even Months
i do scalp from time to time but it's not really my thing, but if the opportunity presents itself i take it.
its not really about "The Dollar Amount Earned", that's not what i pay attention to.
i do my background research, i have a flow chart that i follow, this flow chart tells me and reminds me to be aware of risk, to check certain indicators and news reports and calenders and so on.
it also gets me to formulate opinions and ideas and MOST IMPORTANTLY TO PROVE THEM, i call this BUILDING A CASE.
actually i didn't coin the term, i once had a guy (an institutional trader)) say to me "it's like being in court and you are saying you are innocent, YOU HAVE TO BUILD A CASE THAT PROVES IT"
so.. if i think, say EURUSD is going long.. I BUILD A CASE TO PROVE IT
Now, Whether i'm right or wrong is irrelevant, the more important function here is this.
I Record myself when i trade, i'm recorded on webcam and i have a screen recording of the charts (like a Picture in Picture situation) i share my thoughts with the camera and prove my case on camera
THIS SETS A SOLID TRAIN OF THOUGHT IN PLAY
now. if i'm wrong , i can go back and see , ,at what point in my thought process was i flawed.
if i'm right, i go back and see where i got on the right track and i try and scrutinize at what point did i go off track
so.. yeah, i formulate a strong idea
as for Take Profit and Stop Loss
i'll set my stop loss to 100 pips (actually when the trade starts i prefer to not have one, but i put it there anyway to be safe and i budget for 100 pips)
then when the trade gets 10 pips in profit, i will move to break even (meaning.. I'll put my stop loss 1 pip in profit)
after that when i'll wait until price gets 30 pips in profit, and i'll move my stop to 5 pips in profit
then when price gets to 40 pips i'll move the stop to 10 pips in profit and from there i maintain a manual trailing stop loss of 30 pips on indexes, if it's currencies, ii leave 50 pips breathing space
the main reason why this works is
1. you have the background research
2. you have the trade plan
3. now at this point when i place the trade my main goal , regardless of profit is.... to break even, to not lose
and.. it's very highly likely that i can Almost always (but not always) manage to get into a position of 0% Risk Regardless of how much profit is made
as for the take profit, i don't wait for something i'm happy with, I LET THE MARKET DECIDE.
so what i do is
I just let it run
so let's say i have a trade and the price is at 40 pips, Stop Loss is at 10 pips in profit (Relative to the entry) and i'm going long
i maintain a 30 pips distance from the price
now if my take profit is at say 100 pips, and the price gets to say 95 pips or 90 pips
this means i will have now moved my stop loss to 60 pips (so that profit is locked in)
i will then NOT LET PRICE HIT MY TAKE PROFIT, i'll move the T/P to say 180 pips and let price chase the T/P
so, it never actually hits the T/P, all it can do is either keep going up or hit the stop loss.
but, my stop loss is in profit. so it doesn't matter
Now, i'll usually have 2 trades running
i'll have this long term trade going and i'll have a short term trade (the short term trade will typically take profit between 15-20 pips, I'll let it hit the Take Profit)
when it does, i'll wait for a pull back and enter another short term trade
so i always have 1 or 2 trades running and my risk is always managed, but usually the profit on the long term trade FAR OUTWEIGHS the loss (if any) on the short term trade, so the account overall never suffers a loss.
also, every time the long term trade reaches 100 pips in profit, i'll open another long term trade and start the process over, now if price keeps continuing up, its not uncommon to have 2 or 3 long term trades running
now. if the market goes against me and say hits the newest long term trade, that's ok
because only the following can happen
- all 3 trades can be in profit (by whatever amount) and the top trade will be in profit by some smaller amount then the other 2 long term trades. if it gets hit on the stop loss. it's ok, i haven't lost and i can reopen when price turns around
- let's say the top trade hasn't had time to get into profit and it turns on me and goes say 50 pips the wrong way, well that's ok, because the loss of that is offsett by the profit of the 2 trades that opened below it
now lets say that there is a massive move against me that takes out the top 2 trades .
well. it's ok, because the trade below the top one , opened 100 pips before the top one and if the top 1 opens at 100 pips, ,the middle one has a stop loss at +70pips. so the loss from the top one is offsett by the profit of the middle one
and let's say there is a 100 pip move against me, it's still ok
because the top trade would lose, but the middle trade would profit 70 pips the bottom trade would profit by around least +100 pips
so if all 3 trades got taken out, it simply means i can re open with a very low position and BUY again.
but what usually happens is.. i don't get taken out
and what happens less usually is the top trade will hit the stop loss but not the one below it
that's basically it in a nutshell
i do my research , i refer to indies, i use my experience and what i think will happen and i basically let the market do what it wants to do after i position myself where i want to be.
i calculate everything and make sure NO MATTER WHAT i get myself into a position of 0% Risk as soon as i i can
i hope that helps you in some way
this is not really a secret of any sort, i'ts common sense in my opinion.