It’s my first strategy
The first thing that triggers me to make a trade using this strategy is price action, after that I use indicators to confirm my prediction of market
These indicators may vary from MACD to Bollinger bands and they will be picked based on the market conditions (currently I can use 16 indicators)
After that I give a score to my trade
The scoring system: price action signal: 4 points
Each indicator: 1 point
Market news conditions: can vary from -2 to +1
Each trade require at least 5 points to happen
I only trade from 1 up to 3 percent of my money on each trade
And at last I will do 50 trades a week and review it results at the end of the week
This goes on to a point where I reach 60 percent winrate and reasonable RR
Is there anything that I’m missing?
My initial reaction is that you’re overtrading, unless you’re a scalping trader entering/exiting the lower times frames 1m - 15M…
My second reaction is you’re over weighting a price action signal. it’s never worth 4 out of 5 points. The key price driver is supply and demand and the underlying market sentiment behind it. In today’s Covid 19 environment, fundamental analysis carries more weight and importance than previously.
However, You’ve designed your own system and that’s your edge. Keep experimenting with it - do more of what works and less of what doesn’t, and you’re on your way to being proficient.
Btw - win ratios is a useless statistic - it’s the profit percentage that’s important. I know of two traders playing the 1m chart, with allowable zero/tight spreads losing 80% of their trades, but making great profits. Their system entails cutting losing trades if it immediately goes against them, and letting the winners run and by adding to their winning positions.
best of luck.
It is very important to maintain the risk of trading. If the risk is not managed, the chances of loss are high. If a trader does not maintain a minimum of 1: 2 risk-reward, he will never be able to cover the loss. Beginners and pro traders should manage risk rewards. Because the success of trading lies in the risk-reward.
This risk-reward is nonsense Know your risk but how do you know your reward ? Do you have a crystal ball ?
Cut your losers and let your winners run !
the result from any trading strategy depends on real money management , otherwise there is no chance to bring any amount of profit by using any kind of good analyzing strategy.
Put your system into work to see drawbacks. From what you say it’s difficult to say something about performance. Risk management and exact parameters of indicators you use matter. Also different pairs produce various results for your trading system, becomes some of them may exhibit more trend behaviour than others.
We can test new types of trading systems with the Demo trading accounts for free.
It’s a complete waste of time and energy. Demo accounts as far as I know and have experienced, will fill a normal order at the price that’s displayed on the screen while in the live world, the amount is subject to slippage.
That’s what we traders need to understand. While demo trading, just assume a minimum of 1% slippage. Just consider larger slippage on larger volumes or if I may put it in simpler words, volatile pairs.
That’s what I think. These demo accounts can be made realistic by just excluding the profit/loss on orders that you would have not traded live. I think it’s important that a trader should identify the trades that he would like to trade on live and practice his strategy on the same with demo.
It’s difficult to follow but I suggest the same to my son too. Trade the same capital in demo as you’re planning to invest from your real trading account. Through not every broker will allow you to do this. I can sayw with confidence that turnkey forex and fxpro do in case anyone reading this wants to give this way a go.