so i have read all of the school of pipsology and i have demo traded for only a month to get used to MT4. I decided to jump into the game 2 months ago with $2000. now i just wanted to say HI and tell my story and get any advice i could.
SET UP
I trade only EURUSD and i started trading only .1 lots. now i trade with .15 and .2 I consider my strategy more of a scalper seeing as i use 5 min charts and 1 hour to get a bigger view. i stay in a trade from about 2 - 10 min usually only looking to get 5 - 10 pips. I use Stoch (5, 3, 3,) and RSI(14) mainly and i use those on 2 different 5 min charts and on 1 1hour chart.
I also have 2 moving averages on all three charts. one is simple and one is exponential. I use a bollinger band(20) on one 5 min chart and SAR (.10, .11,) on the other 5 min and 1 hour.
HOW TO USE
Ok it’s really hard to explain what i do. Basically I buy when the stoch is low and starting to rise. (below or right near 20) opposite for selling. I only enter a trade if it looks like a can make some pips. I like to see RSI below 50 and rising for a buy. I also check the 1 hour chart to see where the major trend is heading.
the bollinger band i use for breakouts sometimes. the MA is for trends. and i do look at support and resistance lines. I dont like using a Stop loss but i always use a take profit.
I’m not getting rich quick with this but i have only lost 2 trades in 2 months and lots of small profits. I dont trade everyday. each trade gets me $0 - $20. My two losses were $4.50 and i cant find the other one it was around $20. I did try to use an auto trading EA but it lost me 3 trades totaling $6.50 and i threw it out.
I need help using stop losses. i enter a trade in the negative for a bit then cash out at my 5 -10 pips. how do i know were to set them. I want tight stop loss but i feel like it would hit the SL then go up to my profit. I also think the risk to reward ratio might be wrong if i set it to like 30 pips SL
You really do need a stop. It can be at 30 or 50 pips if its not getting hit. Its an “oh crap” stop. Many things can go wrong when you are trading online, internet outages, power outages, broker problems, the list goes on. It will happen to you! When it does the stop may save you a lot of money.
You need to look at how far these trades have moved against you before they go your way. You need to take the time to look back over your trades and see will a 15 pip stop get missed by 90% of your trades? 30 pip? You need to decide how much you want your worst case trade to lose. With some real data to look at this should not be that hard to figure. Keep in mind if you start to trade other pairs the numbers will change.
Nice work on the high win rate:D. Now a high win rate by itself is not the only thing you need you need to manage your risk also. Trading the way you are you need to concerne your self with the worst case scenerio if you get that under control you will be alright;)
Hey thank you very much for the info! I knew i really needed a stop loss i just wasn’t sure how to find it. ill go back and check my trades. I’m still wondering if I have a solid strategy working for me or if I’ve been lucky for these 2 months lol anyway thanks again for the input!
Another thing you can do is base your SL off of your TP. If you have a TP of lets say 50 pips, would you like your Reward:Risk ratio to be 2:1? 1:1? 3:1? This can help you with deciding what kind of SL would be good, also Shr1ks idea is another good one.
yeah I heard this before an that’s where i was stuck. I only go for 5-10 pips. so risk reward of 2:1 would be a very tight stop that would get hit most likely.
thanks for the help tho!!
I’m still wondering if I have a solid strategy working for me or if I’ve been lucky for these 2 months lol anyway thanks again for the input!