Ok, time to do some demo trading!
Scalping the Scalpers - the @TradeViper method
I set up a $100,000 demo account at OANDA for taking very short-term trades off the 1-minute chart just following the trend. I used the position size calculator here at BP and with 2% risk and a 5 pip stop loss, I can trade 40 standard lots.
I traded the EURUSD, AUDUSD, and USDJPY pairs. Here are the trades I took:
10/12/2017 6:36 PM CDT - EURUSD short at 1.18333 as the price was beginning to pull back from a lower high on the 1-minute chart. Prices moved slowly, and with the spread, I was still negative after almost a full pip move in my favor. All of a sudden a strong bearish candle pushed me into +$600 with only a three pip move. A few bars later and it looked like there was support forming at 1.1830. I held onto the trade because it looked like the bears were still pushing and the price dropped to 1.1829 and then it rallied back up in a huge bullish candle. The bears pushed it back down to 1.1830 before the bar closed. I decided to give it one more bar before closing the position at 1.18318 for a total profit of 1.5 pips. Total time in trade was 13 minutes.
10/12/2017 6:51 PM CDT - Entered a long position on USDJPY at 112.263 as price as pulling back into previous resistance after breaking through it. Immediately after I entered the order a bearish candle shows up. Great, I thought, as I prepared to close my position. The price fell to 112.246 and I prepared myself for the first losing trade of the night. I wanted to see what would happen when the price hit 112.230. Price blew through that level, then climbed back up to 112.24 and then blew through it again so I closed that position down at 112.241. Total loss of 2 pips on this trade. Time in trade was 5 minutes.
10/12/2017 6:53 PM CDT - Entered a long position on USDCHF at 0.97519 as several candles tested this level but couldn’t close below. I was anticipating a bounce off this level and move upward. The spread on this pair was pretty large so I would have to let this run for a bit unless it broke structure to the downside. Trade did break into profit but I missed the close on the position as I was typing over here. We are still not close to the stop loss yet so I can let this run some more. This pair started building momentum against me so I got out while I could at 0.97523 for a .4 pip profit.
10/12/2017 6:57 PM CDT - Given the bearish momentum I saw I entered a short position on USDJPY at 112.224. Of course at that time price bounces off the 112.225 level and starts going up. I hate the yen. I really do. At least, I do tonight. I take back the negative talk as the yen broke through the 112.22 level. Bulls are trying to push it back up. Don’t do that! Bad bulls! I closed this position out for a profit of 1 pip as candles were starting to alternate between bullish and bearish candles. Time in trade was 21 minutes.
10/12/2017 7:00 PM CDT - AUDUSD came up to test a previous resistance level and it held, so went short at 0.78247. If price retraces to previous support I should be able to snag 6 pips. After 6 minutes in this trade, the price is slowly creeping down so this one is looking good. Price came down and started to bounce off the 0.78215 level so I closed out the position at 0.78237 for a 1 pip profit.
After 30 minutes I was up 2.9 pips. Time to go to McDonald’s and put extra cheese on the burger and supersize the fries! It’s a party! 4 out of 5 trades were profitable, however, so that is 80% win rate by my calculations. This method is definitely going to take practice but I see some value in it.
I also found out that I don’t really like MetaTrader as a platform. The charting color schemes make it hard for me to see what is going on, and the chart trading buttons don’t make it easy to reverse positions. I can see the ability to quickly reverse a position being important in this kind of trading. For the next set of trades I will be using the Web Platform from OANDA.
Swinging From the Ceiling - the @cndlstckchic method
Ok, in this demo account I am starting with a $2,000 balance. Position size will be calculated for each trade. I will be finding directional clues from the daily chart, setting targets and stops on the hourly chart, and if needed, dropping into the 15-minute chart for trade entry signals.
10/12/2017 7:27 PM USD/CAD Entered a short position at 1.24762 as the market put in a double top on the 15 min chart, signaling that a bearish move was likely. The bearish move corresponds to the current leg of the trend of the daily chart. Stop loss went to 1.24936 and take profit at 1.24374. Entered with 2 mini lots per risk management rules of not trading more than 2% of the account balance in a single trade.
10/12/2017 7:31 PM AUD/USD Daily chart shows that we are currently in a retracement during a bearish trend. Clues that tell me that are the market recently put in a lower low move and price is bouncing up off of the 0.77468 level. My prediction is that the market will start moving back down now as the price is approaching a level that previously acted as support. The hourly chart is testing the 0.78294 level for the third time in the last day or so. Being that this level held three times I plan to enter short if this current bar on the hourly chart fails to close above the other bars. Unless the bears come in hard, it looks like this bar is going to close above the other bars’ closes but under the highs. I am still feeling bearish on this pair so unless the bar closes above the highs I still plan to initiate the short position. Of course, the bulls push the price above the highs… so do I get long or do I get short? I went short as the daily chart is showing us a downtrend, and there is less risk to a short position based on structure levels on the hour chart. Short initiated at 0.78362 with a stop loss at 0.78641 and a take profit at 0.77741.
That’s a wrap for tonight. As I post this, the USD/CAD swing trade is 6.8 pips into profit, and the AUD/USD trade is 2.0 pips in the red. I will post updates in the morning on the swing trades.