Been messing around for about one year and blew some live account, I decided to go back to demo account to change strategy from 1m scalping to higher timeframe intraday trading or probably swing trading. I’ve been forward testing this new strategy for just about two weeks now. So this strategy is a bit premature and clearly I’m by any means not an expert.
Reason to change strategy because I found that 1m-5m scalping is very exhausting and I could not bear the stress in the long run. I trade mainly XAUUSD and I’ve made a quite profit in scalping but made a quite bad loss as well, and it even worse.
So, here’s what I’ve done that I felt I’ve made some progress or have some shed of lights on how to trade on a high timeframe should be. I’m looking for advice or confirmation or any opinions of what others do on their high timeframe trading…
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I look for clue on which direction the price will potentially go (breakout from consolidation, support/resistance key levels, etc) by scanning from lower to higher TF (eg. 15m - 30m - 1h - 4h -1d). Set SL and TP with 1:2 RR, sometime 1:3 depends on the key levels.
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Monitor the trade for the 1st hour to see if the price moves in my direction or against. I set SL at 1% but if the price is clearly moving against I cut loss at 0.5% and move on.
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When the price is move away from my starting point in my direction ( I called this “take off” position) then I will let it go. Casually check position every two hours or so, move SL to secure profit, but leave a reasonable room for price to fluctuate)
I feel more relaxed now, especially when the trade is already “take off” and let the price go whether it will reach my TP or not, as long as I have secure my position at least to break even. Still working on my psychology on the first hour of each my trade though, but I felt much better.
Any comments are highly appreciated.
That’s a good mindset and technique. Best of luck trading gold, XAU/AUD, though. I got stung today when out of nowhere, a directional change cost me enough dollars for me to cut it short.
IMO, the first hour is critical, and I use the same ploy to cut losing trades short before they start to hurt. There’s always another waiting.
cheers.
Thank you for your insight. It hurts when suddenly a surge change in price direction. But in the case of stop loss hunting (if there’s any) should be within the range to say this is the advantage of high TF trading
Sadly, price movements are identical on every TF. You would need a wider S/L on higher time frames, than lower ones. But if that is no more than 1.5% of your capital per trade, it is good risk management.
Use the ATR number to see the price range zone, and see if it falls within your risk parameters. For example if it’s 0149 try and at least set your S/L at that points level above or below the current price.
I use just below/above PSAR balls on last two candles to set my S/L.
The 1m and 5 m charts are really exhausting as they gives us a lot of false signals in price action trading so judgement becomes really difficult. It is always recommended to see 15 min chart or higher. Just one advice, instead of moving the stop loss I would say stick to your trading plan and don’t let your emotions affect it.
I have to agree with you on the 1m and 5m chart. They are very tricky to use.
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Yes, I have seen in the forums that a lot of traders trade on 1m and 5m charts. In reality they are just taking on the markets’ false signals and losing money. These charts are super super tricky. I cannot imagine trading on them.
You are on the right track for sure. A sudden price change can sweep everything away and nothing can be as disheartening as that. That’s why it is recommended to use stop loss and take profit orders so that you don’t lose more than you can afford to.