What is the entry point

Beginner Questions
1

ok so now im on my second week of forex trading journey ive traded news ive used TA ive mad profit and have had losses i guess the real question of all to continue on this journey is what or when is rhe right entry point

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2

Would be awesome if there is just one answer to that question! :sweat_smile: How have you been deciding to enter trades?

3

so basically i lime the bollinger bands and moving averages when im at the top or bottom of a band i count on the reverse and deciding its going to meet with 50 average also been on top of news article and make a decision from there

4

This sounds a rational way to trade and make money @pip_pimp.

There are other TA features you might find it worthwhile to track even if they don’t decide the trade for you - such as:
was the 50MA sloping upwards or downwards?
was the 20MA above the 50 or below?
was price between the 20 and 50MA or above/below both?
where was the 200MA?
how many times did price cut through the 50MA in the last 20 bars, the last 50 bars, etc.?
so, would you say the underlying trend was up or down when you entered?

Also, how do you decide where your stop-loss should be?

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5

Nobody knows. I mean we can only guess and the market will tell you if you are correct or went wrong direction. You have to always be with a market majority (follow trend) but at the same time be slightly ahead of them. Your profit should come at somebody else expense, because it is a market, closed system with a zero sum result.

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6

The best way would be to analyse and back test your trades

so for example say you used BOLLINGER and SMA and a previous green candle for entry… Using this strategy you won 5/10 trades.

  1. go back over the losses and look around at other indicators or signals to see you can add a correlation for the loss

2)Do the same for the wins

  1. Then backtest to see if correlations hold true… Using both sample and out of sample data.
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7

The right entry point for what? Opening a trade? That depends on whatever strategy you’re using, there is no universal right entry point.

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8

Just make sure that if bb is sloping downwards, only sell and vice versa.

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9

If BOLLINGER band at 70 sell if it at 30 buy. Do not get carried away and think you can have a quick new buy at the 70 mark and do not think you can have a quick new sell at the 30 mark

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10

so ive been reading alot of info on the subject and using a 1-2 ratio usually 25 SL and 50 TP

11

i just got a add what a rush and can see how big a deal the psych part is huge part of the succesp

12

question so if its slopping up or down do you just go with it or against it trend is your friend i believe and what does it mean if it is priced between 20 and 50 MA

13

Actually I look at the slopes of the 20 and 50, and the sequence of the 20 and 50. I do not note where price is at this point but it is almost impossible in an uptrend set-up for price to be below the 50 and yet both the 20 and 50 are sloping upwards and the 20 is above the 50: but price could be below the 20, that’s not something I pay attention to.

14

Have you tried using the TA to identify where the SL and TP should be?
i.e. the chart shows you a place where price would have to go back to in order for your trade idea to be invalidated?
but also a level where price is likely to reach but less likely to go beyond?

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15

i usually set up 25-50 but i adjust and lock in profits to the averages or s&r levels

16

i was really confused this week and had a lot of losses due to mis understanding ecb deposit rate cut i believed it was going to make the eur less valuable instead it just kept appreciating can some one explain the why when he cut rates and bought more bonds

17

bollinger band at 70 ???

18

What do you mean by “add a correlation for the loss” in point 1? I think 10 trades is not a representative sample, 100-200 observations (trades) are reasonable amount. Also we have to somehow adjust correlations for different volatility regimes especially for short timeframes where noise can skew the results.

19

I meant find a correlation but if you were to add a correlation for the each loss you will slowly build cerra environments that are not suitable for your trading style

As this is a beginners forum it’s about learning the right habbit… Further you wouldn’t do a full backtest if they is no correlation in a sample of 10.