The title of this post could just as easily have been the British Pound Trader or Japanese Yen Trader, or any other currency for that matter. There is no particular reason why I chose the Aussie Dollar other than I live in Australia and it seemed like the obvious choice for me. The asset type traded by my strategy is of no real importance. Rather, it is all about (1) simplicity, and (2) focus.
Simplicity: Over time, and just like many other traders, I have found that simplicity works best. A few simple complimentary tools are really all that is needed to trade consistently and profitably. In my strategy, for example, I combine support-resistance (trend lines and channels) with Stochastic and Relative Strength Index to trigger buy/sell signals. That's it. I compare H4, D1, and W1 time frames for perspective, and place all my trades in the H4 time frame. Money management is quite simple also. Support-resistance zones determine stop-loss and take-profit targets. As a result, my trading screen is simple, clean, and easy to interpret.
Focus: The thing I have struggled with most is focus. I can only speak for myself, but when I spread myself across multiple currency pairs I tend to lose money. Other traders seem to be able to cope, but not me apparently. When I go back over my trading history and examine my successes and failures, there seems to be a common thread or association between multi-pair trading and losses, but when I cut back to a single pair or asset I am consistently profitable. So in February this year I opened a demo account with a $5,000 account balance and focused on trading a single currency pair/asset type to test this theory. I looked at Gold and Silver, Coffee, Oil, and even Soybeans as possible contenders, but then thought to myself "Why don't you just focus on something you are intimately familiar with, like the Aussie dollar?" It's so much easier keeping my finger on the pulse of the Australian economy, because I am part of the economy...I live within it, feel it, and know how it tends to react. I am immersed in the fundamentals, so to speak. So, my Aussie Dollar Trader strategy was born.
Why am I making this post? Because you might be just like me. It's early days, I admit, but if my results prove to be consistent in the long-term for me, then a similar strategy might do the trick for you if you too are experiencing focus difficulties.
Simplicity: Over time, and just like many other traders, I have found that simplicity works best. A few simple complimentary tools are really all that is needed to trade consistently and profitably. In my strategy, for example, I combine support-resistance (trend lines and channels) with Stochastic and Relative Strength Index to trigger buy/sell signals. That's it. I compare H4, D1, and W1 time frames for perspective, and place all my trades in the H4 time frame. Money management is quite simple also. Support-resistance zones determine stop-loss and take-profit targets. As a result, my trading screen is simple, clean, and easy to interpret.
Focus: The thing I have struggled with most is focus. I can only speak for myself, but when I spread myself across multiple currency pairs I tend to lose money. Other traders seem to be able to cope, but not me apparently. When I go back over my trading history and examine my successes and failures, there seems to be a common thread or association between multi-pair trading and losses, but when I cut back to a single pair or asset I am consistently profitable. So in February this year I opened a demo account with a $5,000 account balance and focused on trading a single currency pair/asset type to test this theory. I looked at Gold and Silver, Coffee, Oil, and even Soybeans as possible contenders, but then thought to myself "Why don't you just focus on something you are intimately familiar with, like the Aussie dollar?" It's so much easier keeping my finger on the pulse of the Australian economy, because I am part of the economy...I live within it, feel it, and know how it tends to react. I am immersed in the fundamentals, so to speak. So, my Aussie Dollar Trader strategy was born.
Why am I making this post? Because you might be just like me. It's early days, I admit, but if my results prove to be consistent in the long-term for me, then a similar strategy might do the trick for you if you too are experiencing focus difficulties.