The perfect statergy!

Beginner Questions
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The perfect stratergy, the holy grail, 100% winrate…

The only things a beginner sees when hes searching for a how to trade forex.

Real Traders know this stuff does not exist. And i have found out recently while studying forex on this platform and started to read some books. It all comes down to personal preference something that suits you and your trading style. And then backtesting… but…

Now my question is. How do i find my trading style and how do i come up with a statergy?

Is it ok to use someone else his statergy and maybe tweak it to my liking?

Are there standard beginner strategy’s where i can learn and evolve into someone that is capable in making my own strategy and be able to tweak it to my liking?

Im not looking for any system dat guarantees wins or someone to tell me exactly what i should do.

I Have always loved to figure stuff out and get slapped in the face in the process. But i would like to get a little guidance and maybe a small push in the right direction. So i can head down my own path.

I have read alot bout risk management and trading plans and i think i can come up with that but im talking about indicators ema rsi fibonacci or nothing at all.

What is the best place to start my journey.

Thanks in advance!

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I understand what you are asking but as it stands it is a bit like going out into the street and asking a whole bunch of strangers: “Hey, I want to on holiday, where’s the best place to go?”. Who can say what would suit you best without more info about you? There are so many possible suggestions.

I think the first thing to do (if you have not already done it) is to narrow the field a bit by defining your opportunities, limitations and personal characteristics. For example:

How much time can you spend on screen study?
What trading sessions match your available time?
Do you prefer to trade frequently whilst watching price or to identify a trade opportunity, set the trade and leave it to work itself out?
How much capital do you have available and how would this translate into risk exposure per trade thus defining what kind of trades to take?
What is your risk-tolerance as a personal trait?
Do you want to trade multiple instruments or specialise in one or two?
Do you prefer a mechanical system or a discretionary approach?
Do you prefer a technical analysis or fundamental or hybrid combination analysis?
Do you prefer to analyse price movement and structure or using mathematical formula-based indicators?

These are a few limiters that can narrow the field and point you in the right direction. It is then a lot easier to define what you need to build a strategy that fits these parameters. For example, the profile that rises from this kind of analysis might be a trend-following method on a 1-2 day timescale. Therefore, a 4H or 1H timeframe might suit best with a couple of EMA’s to define the trend and an RSI to add confluence to the signal with a stop beyond the recent extreme and a target at a recent S/R level or Fib.

This is only an example and not a recommendation. The point being that by defining your limitations and requirements you can grasp what kind of trading will fit and then search what tools and methods you will need in order to implement it.

Just some thoughts

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Hi, thanks for taking the effort to answer!

I get what you are saying.

Im just starting out. Im planning to demo till constantly profitable and then start with €1000 to get a feel of emotions. When i reach €2000 in no matter what time i will fund it to 10.000. If that reaches 20.000 i will fund it to 50.000. Then i will slowly build it up to 100k with trading and funding. This is all told in a small sentence but its a 4-6 year plan.

I like some fundamental for not getting suprised with a huge move out of no where. But my mind goes to the charts. I have read the ema somewhere and used 50 and 20 and just went back to 2020 jan 1 did a replay. I have looked at daily high and low. 4h 1h 30m 15m 5m and draw boxes trendlines and places where the price was struggleing before. And then made predictions. And did this for 4 hours on a few pairs.

It was the replay function of trading view so i could not cheat. And to my surprise it worked pretty well. I think i had around 30 right and 50 wrong times right. Im reading van tharp so did the risk reward like 1-3 so i thought it would move a max of 10 pips not in my favor i had to get atleast 30 pips in the right direction. And from my calculations i wouldve made a profit. Not amazing but i did not blow my “fake”money away.

The times i was wrong i went back on a few and i wouldve made that same trade again. I really think im not just guessing.

Sorry if this all sounds like crazy talk i just got into this and i just looked at those charts for 4 hours straight 5 days in a row and thought i saw somethings that were kinda predictable. And because the risk/reward it doest matter if im wrong %50 of the time.

My problem is this. When i saw a video on youtube they said “exactly” when to buy. Like a precise point to enter when this crosses this and when dis candle does this and than if that ticks than its a buy and this is a sell.

And what im doing is somewhat a system but its more what i see and my head calculates when i see trend lines and where price had trouble breaking.

I am working on a trading plan in regards of the money management and thats something i can put on paper. And when i tried to put my trading system on paper it sounded a little abstract if you know what i mean.

But my trading “strategy”/system is not something i can put exactly on paper and follow it. What im doing all depends on what im seeing. I dont know if u guys even would call it a stratergy or a system.

Is this wrong? And would something like this be profitable for years and years? Or do i need to adapt a exact system that tells me exactly what to do when to do it.

Thanks alot for the effort people!

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Its very hard to improve a strategy unless you can see exactly what its rules are - exactly why to enter, where to set a stop-loss and why to exit. If you introduce just one random value to any of these, the whole back-test becomes random. Define for yourself what you would do in precise terms.

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On the contrary, it sounds like you have come an awful long way already and there is a lot of sound sense in what you are describing. At least, in my opinion!

No need to be confused about this. Your strategy describes a discretionary approach whereby your charts suggest a trade set-up but your mind actually makes the decision taking “all things into consideration”. These Youtube methods are the alternative mechanical approach whereby the trader “only and always” takes trades that the rules dictate. The basis of this approach is that the outcome of each individual trade is irrelevant provided the system produces an overall profit over time. In particular, that the money management function will control the losses and run the profits or produce a high win rate.

Neither approach is wrong. It all depends on what suits the individual trader. Several widely read books talk about the importance of the 3 M’s: Mind, Method and Money. It seems most newcomers only focus on the Method, but understanding one’s psychology and controlling one’s money are just as important in achieving consistency. You seem to be very much looking at all these three aspects and that is just great!

Whichever of these approaches suits you best will, however, obviously only work some of the time. Markets do not move in nice regular smooth cycles and patterns. There are often similarities but also sometimes dramatic changes. No system can predict these. But by careful risk control (e.g. well-placed stops and sensible position size) big unexpected anomalies can be insured against.

Personally, I think you could benefit from a live account using microlots while building confidence in your approach. A demo account is good for experimenting and trialling new ideas but has one major drawback. A demo is paper money and it is easy to remain objective and look at the whole picture on the charts. But as soon as it becomes real money in a live account, one’s attention can suddenly become entirely focused only on the current price and the current candle and become oblivious of everything else. This comes under the “Mind” category and it is important to be able to remain objective even when the price is looking threatening if the overall assessment remains the same.

Another point I would make. I don’t think there is any need to plan at this stage how big you will make your account as time passes. Everyone has a comfort zone when it comes to position size and risk. This is another of the “Mind” issues. If you start trading position sizes that make you feel uncomfortable when they go against you then you are less likely to remain focused and objective and start to tinker with your method. It is worth gradually increasing your size until you find that point where you are both comfortable with the size and satisfied with the results. No need to define amounts beforehand, you will know when you get to that point.

In addition, it is not really sensible to retain in your trading account more than you need to comfortably cover your fixed and floating margins. And these will be determined by your exposure comfort level. As earnings accumulate beyond this level it is far more sensible to withdraw them and invest them in something else so that they continue working for you. Otherwise it is just dormant funds lying in your trading account.

These are all just my thoughts on these issues, which again is neither wrong nor right. They are just issues that each trader decides for themselves as they learn about themselves.

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Thanks. I will try to narrow down what im seeing and doing and write it down what decisions i make and why. I can see why its hard to improve something when you dont know exactly what it is your doing.

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Thanks. There is just so much information out there and everyone has the perfect strategy and if thats something opposite of me than i start doubting myself.

I now have te feeling im headed in the right direction. And i wil just further educate myself.

In regards of the capital i get what you are saying. Having 100k in the bank and scared to risk more than €100 at a time. Is the 90k extra useless.

I will try a mini account to get a feel of the emotions thanks for the advice!

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I think you will do well to try a mini account. And remember that advice is only another person’s view based on their own perceptions and experience. One of the most important “Mind” functions to develop is confidence. Confidence both in yourself and in your strategy. Until you have that you will be constantly seeking “something better” from others and that is like a yacht in the wind with no sail or rudder.

A better process is to follow your own lead, practice it, see what works and what doesn’t, ditch what is non-functional or distracting, identify what is still missing, look for the tools to fill the gaps and thereby build systemically and consistently.

There is certainly nothing wrong is seeing what others are doing and learning and developing from them, but from a position of strength and confidence rather than weakness and uncertainty in yourself and your methods.

I wish you every success and hope that you will keep us informed of how you are doing!

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Oh and one last comment here! Be a little cautious of what you read about percentages when people talk about how successful they are. If you make a $100 with a $100,000 account your percentage performance will look pretty poor when compared with another trader taking the same trade and making $100 with a $500 account. But the trade was just as good! Percentages do not tell the whole story by any means.

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Thanks alot for your advice! I will keep you informed.

Thanks again, and what a great community.

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It’s good that the strategy is working for you. But it doesn’t mean that it will for every other trader also. A trader must look for a suitable strategy on the basis of their requirements.