I’ve not been on baby pips for sometime now.
In my time away I’ve been having some success and now have an demo account that is always in profit.
But the profit is so small that it doesn’t warrant my time trading.
My strategy is very simple I use a 5min chart or with some pairs a 30 min chart with a 50 ema, If price is above I look to trade long if its under I short.
I look for price action signals and use a standard setting stochastic for confirmation if its needed.
What typically happens is I win a lot and then lose most of it, But I just stay ahead so I looked more into my losses and I’ve came to the conclusion some of it is over trading or breaking some of my own rules. Its something I will work on before thinking about going live.
I noticed one more thing, At times I am trading two strong currency’s or two weak currency’s and what typically happens is they produce a lot of false signals.
In the past when I was trying to learn to swing trade I used to use the Krivo index indicator on the 4hour charts to determine the strong and weak,
Now I am day trading I am a little lost as how I could make this work for me as the 1 hour chart is the one I use in conjunction with the 5 min and its doesn’t work as well in my opinion for day trading.
Has anyone got any thoughts on this or methods they use for day trading the strong v weak pairs.
Also if anyone has any recommendations of software preferable free but if its good I don’t mind paying.
Thanks for your reply Midwest.
I have already done a search but unfortunately most the S&W posts I’ve came across are based on longer time frame trading rather than day trading.
If you have know of one I perhaps missed could you possibly post a link?
MissPiPa, when dealing with S&W on lower time frames a heat map may work better for you at this time
This site is well-respected Forex with both.
Keep in mind that trends start at the bottom and work upward. Foks that allignment trade will use two or more time frames etc.
With lower time frames, I simply trade what I see on the chart and look for a few key patterns or few candle signals to confirm my bias.
For examnple this trader appears to be doing pretty well. Profitable System
Eventually, we all are here for that reason; I mean indentifying the high differenced supply-demand market. For me, I rely on Price Action & support-resistant levels.
That first link may be exactly what I was looking for, just perhaps on lower time frame but its gave me something to look more into.
Funny enough I am in the middle of forward testing a strategy very similar to the one on the second link,
I use the 1 hour setting for the ema’s on the 5 min chart and instead of PP I use my own S&R levels.
Trading what I see is basically what I have been doing until now, Some weeks I get up to 5% gains then give most of it back so I finish on between 1% and 2%.
After doing some studying of my losses and looking at the trades I missed I tend to find one of the currency’s from the pair I was tarding either became stronger or weaker and that’s what caused the loss. My theory is if I can keep my eye on S&W it should help me stop giving so much back to the markets.
Miss PIPa, YW
You said some weeks you get 5% and others not so much. That is not the cause of your trading system, so I would think twice before making a big change to it. There is two main reason that that type of inconsistency happens.
The market changes and the trader doesn’t adjust to it.
and the more common reason is improper cash management with sizing and leverage (the number of trades).
for my leverage I do not risk more than 1% per trade and usually a lot less than that, trading at, 02 lot. Let us also remember that your potential loss and the 1% is calculated from your stop loss to the entry price. BP has a good position size calculator. This is especially important for new traders that do not have a multi-thousand trade track record yet or even hundreds useing the same strategy. This is very important so that the trader will have road signs for what to adjust in there strategy.
Now as a trader matures and the size of the account grows in confidence and experience from consistently profitable trading then its time to look at sizing because that’s where the real money is made. But first, a trader must learn emotional maturity and how to avoid gambling.
These two podcasts are simple and right on the mark.
Trade Like a Casino for Consistent Profits by Adam Khoo
Trade Like a Casino Part 2: Creating a Profitable Stock Trading System
I trade in three accounts so that I can keep my journaling separate by trade type.
scalping, 5-10 pips per 2, overnight 50 pips per and 3, day trades 1-15 pips per.
Also when your new or trading real money whats the best way to work out of a loss? make sure it was a small loss to buy keeping your sizing low.
More about record keeping later on, but first you must have a written down trading plan with rules. The tighter the strategy is the better you will be able to duplicate it every trade. Precisely define your entry trigger and exit reasons.