Hi, I am from the UK and new to trading. I am spreadbetting using finspreads and trading on a 10 minute chart. I am trading expecting between 25-50 pips per trade using a 7-10 pip stop. Just wondering if anyone else is trading these small timeframes and if you are, how big is your stoploss?
Hi Manito.
Im trading 5 mins on my chart but only after 5pm.
Im aiming for 15 to 20 pips per trade with a SL of up to 25 pips depending on what the previous candle for my signal was.
A trade will stay within the 7-10 pips SL for a while for me before it moves in the right direction so would be no good for me.
Generally I think your SL is too low but may find others find that acceptable?!?
You didn’t say what currency pair you’re trading, but anything with a spread greater than 2.5 would be very costly to trade with a such a small stop. If you’re trading something with 4pip spread, you’re paying 3 pips extra on a trade relative to a 1pip spread pair (like EUR/USD).
10min chart/15min chart. I’d recommend 15-30pips depending on the pair. Sub 15 pip stops can work but only if the S/R level you are keying off is squeaky clean and isn’t likely to have a margin of error more than 5 pips above and below it. I wouldn’t recommend taking any profits off the table until at least you have covered the distance of your stop (let’s call that +1R) and preferably you’d be leaving some on the table for multiple-R trades.
Personally I’ll do 10-20 pip depending on the setup. Working my entries off 5/10/15min charts. Also in case you didn’t know, you should only be utilizing this strategy if your bigger picture analysis is lining up for a strong one-way order flow bias.
Thanks for that, I am trading the eur/usd and it has a 1 pip spread, wat do you think is a good w/l ratio and also risk reward ratio? Do you use take profit limits or do you just move your stop upwards???
Let me try and get you started on the right path here. Your targets and stop losses should always be mindful of S/R levels. Usually you’d want to take profit just as price was arriving at a key S/R level, and keep your stop just below a level of S/R on the trailing side of your trade. Never just hammer out a specific ratio to use all the time, it’s possible to have more precision than that. Give your analysis more credit than just saying “I’m going to get out at +20pips everytime”. You might look at the levels and say, hey there’s a good 40pips to be made if I end up being in line with the flows. The order flows aren’t going to turn around without a reason (generally), and if you on the right side of it, you can use that assumption to really reach for your targets.
Win/Loss ratio… all I’ll say is this. If your average R-multiple gain for each winning trade is above 1R, then anything above 50% Win rate will have you net profitable :41:
yes fibonacci retracements (and extensions) can be used to determine your target price. Remember that you can draw fibs on higher timeframes, and then zoom in and that level will be a valid S/R level, assuming your skill at drawing fibs is developed.
Been facsinated with forex, stocks and shares for over 2 years - demo trading for last year - went live last week with £93 profit for £1 trades - 7 wins and 2 losses. still looking for other stuff. its all about constant learning…