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00:00Today, I'm going to show you the best Forex strategy, and I think it might be a bit of
00:04a surprise.
00:06And then three important tips to winning at Forex trading.
00:09Be sure to watch it all.
00:31Hi, this is Tim from TradingStrategyGuides.com.
00:35I'm still sounding a little raspy here, so apologies for my voice.
00:39Hopefully, this will clear up in a few days.
00:41Today, I'm going to show you what I believe is the best Forex strategy.
00:46It'll probably surprise you.
00:48And then three important tips that will help you to win at Forex trading.
00:52Then I've got something really important I want to tell you.
00:55After that, we're going to take a look at a new setup on the Euro-Swissy Forex pair.
01:00But first, updates on our open trade.
01:03Yes, currently, I've only got one open trade.
01:06And then later on, the trading maximum for the day.
01:09Let's go for it.
01:10Remember to click the subscribe button and hit that bell, so you don't miss learning
01:14these winning Forex tips.
01:16Okay, on to the open trade.
01:18As anticipated, we got a close below the range on the Litecoin-Bitcoin cross yesterday.
01:25We got sufficient volume that I sold a full-size position at $60.62 with a stop loss of $64.30
01:32and a first target of $58.20.
01:34If we get a candle close back inside the range, I'll close this one for a loss.
01:40We got our profit on this New Zealand Swissy, but I want to continue to watch it to see
01:44what our results would have been if I had used the Parabolic SAR for following the stops.
01:50As of now, we would still have our stop at break-even.
01:54And you can see that it's pushing up pretty hard today.
01:57Okay, I'll show you the Euro-Swissy setup shortly, but first, I'm going to show you
02:01this great Forex strategy.
02:03Well, I told you this might be a bit of a surprise, didn't I?
02:07I'm about to say something that's always very controversial when I say it.
02:11And if you disagree with me, don't hesitate to give me your opinions in the comments.
02:15Just be constructive about it, okay?
02:18Don't just tell me I'm ugly and my mom addresses me funny.
02:21I already know that.
02:23Tell me why you disagree and what you would do or say differently.
02:28Okay, here's the statement.
02:31Your trade entry is not the most important part of your trading success.
02:36Let me say that again.
02:38Your trade entry is not the most important part of your trading success.
02:43With consistency, proper trade management, and discipline, you can almost have a random
02:49trade entry and still be successful.
02:53Of course, there are caveats, but your entry timing and direction are far less important
02:58than most trading students perceive they are.
03:01So my best trade strategy is my trade management strategy.
03:06And I use it for just about everything.
03:09And it consists of these rules.
03:11Number one, stop loss is one and a half times the average true range, or ATR, on the entry candle.
03:19Why do I use the ATR?
03:21Well, because it adjusts itself automatically for the time frame or market on which I'm
03:26taking my entry signals.
03:28For example, if I'm trading the Great British Pound New Zealand dollar forex pair on the
03:33daily time frame, the ATR might be 250 pips.
03:38But the ATR for the Euro-US dollar on the one hour time frame might only be 10 pips.
03:44Rule number two, the first target is one times the ATR on the entry candle.
03:49Yes, initially my risk is greater than my reward.
03:53But functionally, my per trade losses are typically smaller than my per trade wins because
03:59of the next rule.
04:01Rule number three, close the trade immediately if the entry conditions change.
04:07If the initial plan for your trade goes wacko before you hit your first target, close the trade.
04:13There's no reason to hold for a whole stop loss when you can take a quarter or a third
04:18of your loss instead.
04:20I always back test to be sure this is true of my strats.
04:24Rule number four, take half off of your trade for profit when the first target is hit.
04:30You can just move your stop loss to break even on your hold position if you want to.
04:35And if you've got a good entry strategy, you may make more profit overall doing that.
04:40That's the case on most of my entry strats.
04:43But I don't do it because it always ends up whipping my account around with bigger drawdowns.
04:48I just like to know that I've got some profit early on.
04:51Rule number five, move the stop to break even on the second half when the first target is hit.
04:56This ensures that your trade is free from this point on.
05:00And lastly, rule number six, follow your exit strategy for the second half.
05:06This could be any of several methods that I've shown you over the last few weeks.
05:10Like Heiken Ashi Candles or Parabolic SAR or something else.
05:15Experiment liberally.
05:17With all that having been said, a well tested entry strategy is far better than a totally random entry strategy.
05:24But the statement brings into focus the important parts of trading.
05:28Consistency and discipline.
05:31And that brings me to my three tips.
05:34Tip number one, define your trading rules.
05:37Tip number two, back test your trading rules.
05:41And tip number three, follow your trading rules.
05:46If you have rules, then follow them.
05:48If you determine a rule needs to be changed, then take the time to test and compare the old rule to the new rule.
05:54And then make a legitimate change in your rule set.
05:57Don't just randomly change a rule just because one time you took a big loss or a big win or whatever.
06:03Remember I told you earlier that I had something really important to tell you.
06:07You know we want this to be the best trading channel on the internet.
06:11The only way we can do that is to see traders lives transform through successful trading.
06:16How many of you believe with me that you can be a successful trader?
06:20If you believe you can be a successful trader, like this video and tell me what you believe your success will look like.
06:27Take a second to comment in the section below what you're trying to accomplish with your trading.
06:32Let's look at the Euro Swiss trade set up.
06:35The Euro Swiss has got a nice well confirmed bear flag.
06:39A bear flag starts with a downtrend, then an upward moving parallel price channel.
06:44I also like confirmation of these patterns with declining volume and volatility.
06:49We anticipate a bear flag to break to the downside.
06:53And here's the trade plan on this bear flag.
06:56We will simply sell a daily candle close below the bear flag.
07:00On the breaking candle, to enter a full size position, I want to see this volume bar reach up to or beyond the volume average.
07:08If it doesn't quite reach the average but does reach at least 75% of the average volume, I'll open a half size position to reduce risk.
07:16You can calculate the percentage by dividing the volume here by the average volume here.
07:22You should get at least .75.
07:25If you don't get that, don't enter the trade.
07:28The stop loss will be 1.5 times the ATR and the first target will be 1 times the ATR.
07:35That means on the breaking candle over here, look for the ATR.
07:39Multiply it by 1.5 to determine the stop loss and place the stop loss order that far above the entry price.
07:48Place your first take profit 1 ATR below the entry price.
07:53If after entering the trade we get a candle that closes back inside the bear flag, we'll take the loss right then and not wait for it to hit the stop loss.
08:02Our intention is that a breakout below this pattern should be explosive and hit our target fairly quickly.
08:08If the momentum goes away, we want to shut the trade down without taking a full stop if possible.
08:14When the price hits our first target, we'll close half the position for profit and set the stop loss to break even on the remainder.
08:21We will then follow stops as price moves in our direction until the market takes us out.
08:26These two rules are the very definition of cutting your losses and letting your winners run.
08:31Typically I do this using two positions.
08:34The first position has a stop loss and a take profit at the appropriate prices.
08:39That position will close automatically when the first target is hit.
08:43The second position will have a stop loss and no take profit directly associated with it.
08:48And that's the position that will be allowed to run.
08:51When the first target is hit, we will have to manually move our stop loss up to break even on the second position.
08:58I will only risk about 2% of my account on each trade.
09:02And that's the new setup on the Euroswissy Forex pair.
09:06Once again, I'm not trying to tell you what to do.
09:09I'm just telling you how I handle these trades.
09:12If you want more details about what I do, look below this video for a link to my trade management video.
09:18And if you've got a trade management plan that works better for you, by all means use it.
09:23Trading is a very personal thing and things that work for me may not work for you.
09:27You have to understand your own mind to find the best strategies for your own trading.
09:31And of course, as you know, psychology is, in my opinion, the most important part of trading.
09:37And the trading maxims are my way of helping to handle my personal psychology.
09:42A maxim is a general truth, fundamental principle, rule of conduct, or a proverbial saying.
09:48The purpose of my maxims is to motivate me to discipline in trading as well as other areas of my life.
09:54I suggest you start your own list of maxims.
09:57Things that you can say to yourself while you're trading or doing life to make sure you always do the right thing.
10:02Feel free to borrow from my list.
10:04And today, Tim's trading maxim number 24.
10:08A smart person learns from his mistakes. A wise person learns from other people's mistakes.
10:14You know, I've made many mistakes in my trading and my life.
10:18I freely share them with my friends because I want to be a shining example of what not to do.
10:25I know sometimes we have to make our own mistakes to really get it.
10:29But it's so much easier to learn from someone else's mistakes.
10:33I wish I understood that when I was 20 years old.
10:36I spent much of my life relearning things that my dad actually tried to teach me as a teen.
10:41Would that I had paid better attention back then.
10:44Remember our Euro-Swiss trade plan here.
10:47We're going to sell a daily candle close below the bear flag.
10:50If the volume is not quite average, go half size as long as it's at least 75% of the average.
10:56Your stop loss is 1.5 times the ATR and your first target is 1 times the ATR.
11:01And remember to click the link below to the trade management video for more details.
11:06And please don't miss any of my trading picks.
11:08Sign up for my trading picks email list so you're sure not to miss them.
11:13I'll be sending out three or four trading picks a week.
11:15Everything from stocks to futures to cryptos to forex.
11:18And you'll see them first.
11:20And the best thing is it's free.
11:22I'll put the link below this video.
11:25Be sure to come back to Trading Strategy Guide's YouTube channel every week on Monday, Wednesday and Friday at 3 p.m. U.S. Eastern time for my new videos.
11:34We'll have a nice trade set up or two on each one and maybe some extra Q&A or training.
11:39Don't hesitate to ask any questions you may have.
11:41I'll either answer your question right in the comments or in a training video or both.
11:46And remember the only stupid question is the unasked one.
11:50And please don't forget to comment below on what being a successful trader looks like to you and what you're trying to accomplish.
11:57That's the way we make this the best trading channel on the internet.
12:00By seeing lives transformed through trading success.
12:03As always thanks for watching.
12:05Thanks for subscribing.
12:07And don't forget to hit the thumbs up below.
12:09Have a great weekend and I'll see you next week.