Effortless Trading Explained + FAQ

Hi Ata,

Didn't want to clog the EURUSD thread with this question regarding the system. Please have a look at the BLUE TL that i have drawn on my chart. I had marked out 1260 area as a sell zone after the breakout candle as seen on my chart, and i had a sell order placed there. However, once London opened, I faced a 25 pip drawdown (my SL was 30 pips), and i luckily managed to come out with 10 pips profit after the drop came.

I also noticed that on the chart you posted on EURUSD, your BLUE TL was placed on a different red-blue candle couple - the couple marked out in the yellow circle. The reason why i had drawn my BLUE TL where i had drawn them on my chart is because i saw a lower close on the bearish candle compared to the bearish candle in the yellow circle. My question is this - did I draw the BLUE TL on the wrong candle couple according to your system, or was this a correct entry according to the system and just a situation whereby i had to face larger than usual drawdown?

Thank you for your time!

Hi Bro, It appears to me the entry idea was simply to sell pullbacks in the direction of the prevalent trend which was bearish in this case, once price went at least 10 pips above the GREEN LINE touch point.

Did you still follow those other parameters for trade entries like waiting for a break below and a retouch as well of the Blue TL which would have been on our charts since we were anticipation sell opportunities, or you simply just waited for price to move above the GREEN LINE and sold once it went at least 10 pips above with the hope that it will ultimately drop back into the direction of the bearish trend?

Sorry mate, I just noticed your question. I try to answer it properly but it might take some time so I hope you don't mind if I share my answer this weekend.

Stay Green

I often try to follow all parameters. But rarely, I might risk a trade (i.e. test waters) if I feel confident with just one parameter. For example just entering with a GREEN LINE touch. It really depends on my gut feeling which I can not teach and every trader must earn with his/her own efforts.

Stay Green

Thanks for the response., I'm learning a lot from you

Okay, I see there are many problems to clarify. Be prepared, it will be a long list of explanations but it will help a lot. As promised, let's get started..

1. First of all: Sorry but your angle is definitely incorrect. Here is a tip for whenever you have doubts about the angle: try to look at previous sections to find clues about the correct angle. In your case you could look at point A on chart below and discover that all the CLOSINGS of candles line up. You could simply use that angle as your guide.
2. Now once you have the correct angle you will always prefer to trade touches to DASHED RED or DASHED BLUE TL's (a.k.a. dashed touches). Breakouts from RED or BLUE TL are secondary (a.k.a normal breakouts). The bigger profit and lower risk always comes from trading Dashed Touches.
3. If you look at the chart you will see a black rectangle. I put it there to emphasize the previous lowest low. After that low was printed all the following candles open above it. That means until a new LOWER CLOSE you neither should move your lines nor clone new ones. There, I waited for a "Dashed Touch" and if you look carefully, it happened around 1.1319 and then I looked for a sell setup as I usually would do. BUT once I entered short you will notice that candles are now far away from the lowest low. Rules would say don't clone new trendlines but here, as an exception, I can still clone new lines. Not that I have to, because I am already short. But in case we missed any previous opportunity or if we want to add to our earlier shorts then we are allowed to clone trendlines in cases like this. So I did and B, C and D are this type of cloned lines which I name "INSIDE CLONES". I make use of them so that I don't miss out new trades when market goes sideways or makes a large correction.
4. Anyway, back to the flow: Point B is a place where the "Inside Low" sits. After that low there is no new LOWER CLOSE for a while and candles are only going sideways. Here I sold at Dashed Touch (notice the first red arrow on chart point B). Price goes down and I put my SL to breakeven once I see 10 pips or more distance it goes lower and breaks out from BLUE TL even better. But then comes back and stopps me out. So be it. No problem. Then price goes even higher and touches dashed TL again. I manage to sell again (of course with help of M5 or M15) and I am short again (notice the second red arrow on chart point B). Then I face a draw-down of roughly 10-15 pips but voila price soon drops fast and trade is an easy success.
5. Now you have a trade running or you closed and wait for a new trade. We have to wait for a new "inside" lower close. That happens at point C. But no blue candle yet. "Why would you close your previous short order without even seeing a blue candle on M15 remember? Here it is the H1 chart and same rule applies. Why would you close your sell order without even seeing a blue candle on H1? Anyways let's say you have no trades open and you look for an entry point. Well, you wait for a new blue candle so you can clone your trendlines. And soon one appears (notice the bluıe arrow on chart point C). Because that candle is higher than the red candle it automatically becomes the place to clone the DASHED BLUE TL. What does that mean? yes, immediately look for sell opportunity. Because Dashed Touch automatically happened here. You see? So with help of M5 or M15 we can sell here and boom price drops immediately. Another easy success.
6. Now new red candle has printed a new LOWER CLOSE. We now can clone new trendlines (Point D). But as you can see the new DASHED BLUE TL is at the same place with previous one. So we already knew this and sold there. Do you slowly start to understand the logic? Many times "waiting" kills your opportunities. We must act quick at times and system shows us the best place to do so. Now, if you look at chart the normal BLUE TL is a little bit lower than the previous one. You can trade the normal BLUE TL breakout if you want but as I said I prefer trading the Dashed Touch.
7. At point E we have a new lower close but notice that this close is also a LOWER OUTSIDE CLOSE. Now price made a real new LOWER CLOSE. That's when we also must look at MACD Divergence. And on chart below you will notice the first divergence (the green box). Divergences tell us to be careful when trading Dashed Touches. Because price can go much higher. It is not something we should feel scared about. We will still trade the Dashed Touch but it is a warning to be aware for surprises. I also use it as a signal to trade a STEEP TL breakout on M15. I will not explain STEEP TL breakout here but just to remind you that with MACD Divergence situations we have that option as well.
8. And here we are.. at point F, The area where you had your troubles. Yes, you might be thinking I could simply cut to the chase and directly talk about this issue but I wanted to show you the bigger picture so that traders like you can understand the whole idea. Now, point F prints a new LOWER CLOSE. I put GRAY trendlines there to show you the error in your trendline angles. You have chosen a very steep angle because your chart window is too wide and not high enough. Again: next time try to look at previous angles to find a better match. With correct angles you can see that I cloned new Dashed BLUE and BLUE TL on the whole RED candle (notice red arrow on chart point F). Later I shorted the Dashed Touch and didn't face any problems. Candles were also very close to green line and I was happy to see a bounce. BUT if you look closely because of MACD 2nd divergence (orange box) I already could anticipate that price might go much higher and it did: It even touched the previous Dashed BLUE TL before bouncing back down. There we could definitely trade a bullish STEEP TL on M15. You were simply failing because you had: wrong angle, you chose to trade a normal trendline breakout instead of dashed and you didn't notice MACD divergence. 3 weaknesses forced you to face the problems. But no worries, the more you grasp the logic I am explaining here the better will be your confidence.
9. After point F (and orange box) pushed price up you can also notice that we have no new LOWER CLOSE for some time. That's why I didn't clone new trendlines there. But we could still do it if you had no trade open. That's something you will figure out yourself the more you trade the system.
10. At the (blue box) area we have a 3rd MACD divergence. My logic for 3rd MACD divergences is this: They can be fake. Especially if a major retracement already happened at MACD divergence 1 or 2 the 3rd is not that important to me. Just be careful but don't take it too serious. We could still trade a Dashed Touch if we wanted.
11. Later at point G we have a new LOWER CLOSE and same story here (notice candle with blue arrow on chart point G): That candle is again automatically the Dashed BLUE TL clone area. I don't even wait and with help of M5 or M15 I sell there. Price goes sown a little I put SL to break-even but later it comes back and stops me out. I wait and see another Dashed Touch (notice second candle with red arrow on chart point G): I sell there with help of M5 or M15 and price doesn't come back to hunt me and therefore another success. Actually price comes back after a little drop but that distance is not enough for me to move my SL to break-even. Therefore my SL is still way higher than any attempt of SL hunters and I succeed. That's the beauty of waiting at least for 10 pips movement before you put your SL to break-even.
12. Points H and I are totally similar so I will not repeat same logic.

Pheeew.. so I hope it explains a lot.. With all the information given, add this knowledge on top and continue observing your journey. I hope it helps and if you still have any questions don't hesitate to ask.

Enjoy your weekends.. and peace

Stay Green

Wow thanks Ata. I didn't expect such a long reply. This really is very helpful and i will try to implement this in the coming weeks. Especially how you pointed out the 3 errors i made, looking back, I think i was too focused on the breakout candle and simply overlooked the chance to trade the dashed touch, as well as look out for the MACD divergence. Many thanks for that.

Anyway, regarding the trendline, I believe my screen dimensions are simply different from yours. I just checked again on MT4, using zoom settings 2(as you stated on page 1) as well as 36.9 degrees for the trendline, and i got the exact same trendline that you said were too steep. I compared it to your charts and realised that in order for my trendlines to be similar to yours, i ended up using one with around 31 degrees. But oh well, I think i will take your advice at point 1, and simply take previous sections as clues to get the correct angles for the day/week. 36.9 degrees will just be a rough guide as i move forward. What do you think?

You're welcome.. well yes 36.9 is an idea that works for me.. but since you said it: altering angle to 31 so that it syncs with mine is also wise.. window dimensions can vary but the logic doesn't. The core of my teachings is simply to "follow the trend" BUT in a certain way that helps you to sell below GREEN line "as high as it gets" and to buy above GREEN line "as low as it gets". That's why I emphasized the "Dashed Touch" a lot. The more you stick to the idea the greater you will benefit from it over the longer course.

Good luck and enjoy your weekend..

Stay Green

Additional Example on How to Step Down to M15 after Spotting an Opportunity on H1

Hello again.. lol.. I just wanted to explain how to enter a trade on M15 right after spotting an entry opportunity on H1. Let's analyse the two examples:

1. Point 1: So here we are above the GREEN line and were waiting for a BUY setup with a RED Dashed-Touch. That happens at point-1 and at that very moment I switch down to M15 and start checking to see a bull candle (in other words on my chart I am simply waiting for a blue candle). Price goes lower and lower but no blue candle shows up for a while, which is even better for me because as I mention again and again we are trying to buy "as low as we can" and we always try to do that while H1 candles are still "ABOVE" the GREEN line.
2. So, on the M15 chart section, which I put directly onto the H1 chart below, you can see that market finally prints a bull candle with an opening price of: 1.1230. Then I wait for a retest to that level and enter manually or you can put a "pending buy limit order" and let your trade get activated automatically). As you can see 2 candles later a long bearish candle drops and fills my order. I face a 5 pips drawdown here and then price goes back up. Maybe I make some profit afterwards maybe I get stopped out at break-even, every trade is different, but one thing for sure, we entered at best (lowest) price possible. If we assume I get stopped out at break-even, I simply would take the next Dashed-Touch level (point 2) and I would use the same entry logic there. Of course here I probably would have another break-even trade. That is never a problem. The point is we still manage to enter at best (lowest) price possible.
3. Now, let's jump to point 3, which is a BLUE Dashed-Touch below the GREEN line and therefore it would be a sell entry. But would I take this? NO! NO! I wouldn't. Why? Because if you look at all the touches there from 3 to 7 you will notice that NO BLUE TL breakout occurred yet. So always remember: A Dashed-Touch opportunity only comes AFTER we have at least one normal TL breakout. That's not the case up until point number 8. There we have the first breakout (or better say slide-out) from BLUE TL and right after that slide out price shoots back up with candle number 8 and almost touches the Dashed BLUE TL. That's the real place we can step down to M15. Now, this time on M15 chart section, we can see that we still have a bull candle there which can't even touch the Dashed BLUE TL and then it drops down. If we still assume that it touched the line, we still must wait for a bear candle. On M15 chart that candle comes right after the bull candle. Now we can put a pending sell limit order to the opening price of that bear candle. But unfortunately none of the following candles come back for a retest and my order doesn't get triggered. Still not a problem!
4. Once we see that the M15 chart couldn't provide me an entry I keep checking the H1 chart and notice a normal BLUE TL breakout. Without hesitation I can enter short manually OR I can step down to M15 and try to enter short there the way I just explained.

I hope this adds a little more to your so far collected skills. If you have questions don't hesitate to ask. Peace..

Stay Green

were waiting for a BUY setup with a BLUE Dashed-Touch.?? were waiting for a BUY setup with a RED Dashed-Touch.

Thank you for the strategy explanation. I have made some good entries thanks to your tips. Before these entry points were usually opposite way to get in the trade and look for the reversals for me and go against the trend.

You're welcome buddy.. I feel glad if it helps.. I and many of my followers and also other valuable traders share ideas daily on this thread (EURUSD Only) in case you are not aware: https://www.forexfactory.com/showthr...&goto=lastpost. Feel free to follow our sharings around the EURUSD pair if you like. Otherwise I wish you more success on your trading journey. Good luck!

Stay Green

Answering a Questing that came via PM

I put the H1 chart for the date that you referred to. Below you can see the way I would trade it:

1. I would have sold Dashed-Touch (1) directly via H1 chart or by going to M15 chart and looking for perfect entry.
2. Then I could also sold at "Slide-Out", meaning at the point where the new candle opened below normal BLUE TL (1) which I don't prefer that much but is still valid.
3. Later I could sell another Dashed-Touch (2) again directly or via help of M15 or even M5 chart.
4. Finally I could sell again with a new BLUE TL breakout (2).

But I can't see the issue that you mentioned in your question. Maybe you can elaborate or correct me if I picked wrong area.

Stay Green

Hi Ata.....I really appreciate you to taking time for sharing H1 effortless trading approach.....I have a question about yesterday trend(5 July 2019) ....after LO time there was an absolute downtrend according to the H1 ET ..however you did not open any selling trade and only waited for opportunity to open a buying trade....May I ask you Why ? Personally I trust you and Know you have logical reason for it....only to know if you dont mind......

So basically after watching a lot of your images you simply present somewhat ideal situation where trend will rise after some time which is really good, but I bet many people already know here that they really need to buy after some spikes which is clearly an indicator of growing trend. I am talking mainly about "9. The Main Logic of the "Effortless Trading" Methodology" and some other points which I am currently studying anyway, but I am busy to read whole thread not just start post

I made calculation errors and insisted in buying very early.. It was a week where I didn't follow my own system and kept checking many other elements.. So please ignore that week despite the fact that I shared the bearish shark pattern and pointed on 3 targets all the way down to 1.1225 me myself couldn't focus that much on selling.. No matter what level of experience we learn from our mistakes, we note it down and we move on..

I hope it clarifies..

Stay Green

Keep studying.. soon you will see how trading with most basic mentality can give you more profits than any other complex system.. and yes 9 is the core post of the golden idea.. unbelievably simple but yet very effective...

Stay Green

Very very useful topic , I was always hoping to have your methods , thank you Ata I will study carefully

10. My Latest Experiment: Special MOFU Candles

Lately I began to use a new Weighted Moving Average line:

1. The WMA19 (Shift 2) on H1 and all smaller timeframes,
2. The WMA17 (Shift 2) on H4 and all higher timeframes.

Now.. when a very long candle (any candle that seems to be larger compared to its nearby surrounding candles) crosses the wma19 (or wma17) line, I mark it as my special MOFU candle. These type of candles "often" (let's say 85% of the time) create a "magnetic effect" that sooner or later pulls price back to their "opening price". Once that happens it is likely that price "bounces" back from there (roughly 55-65% of the time).

Neither the magnetic effect nor the bounce is 100% guaranteed but it is till worth to look for this pattern especially with confirmation because it happens often. I will continue to experiment with this and hopefully share new findings later.

To see an example chart where I show many of these candles you can check one of my posts here: https://www.forexfactory.com/showthr...3#post12432033

I hope it helps..

Stay Green

Hi Ata,
i know it is very difficult to get your MOFU candles. i just try myself to get my own mofu candles (i think my mofu is different from yours, of course) ... and lets say i have some mofu candles at some different time frames (from small to big one), how do we know that it will touch the extreme one (lowest value / highest value) , and when we can know that it will ignore the extreme value (i mean: it will bounce back after it touches the 2nd lowest/highest value, and never touch the extreme one , at least for some months to 1 year) ??