Project

Hello,

this thread is intended for a project i am working on.

The goal is to create a profitable trading system using ATR indicator along with retail sentiment. Risk will always be 2% of total account balance. Stop loss will be based solely on 1.5x ATR.

I've taken one trade using this method which earned 3%. Below is the second trade based on Retail market sentiment being net long. The thought is to wait until retail traders saturate one side or the other before placing a trade- anticipating their move in the opposite direction.

Constructive criticism is welcome.

Current position is at positive 1:1. There is risk in holding a position since the federal funds rate decision is at 2pm. This will cause great volatility for the remainder of the trading day.

I will not trade it, but my prediction is rates are held to current level. Eur/USD price willl spike down to 1.1190 to clear remaining longs, then head back to mid 1.12's.

I am selling into the weekend based on bullish retail sentiment and the fact that the FOMC left interest rates unchanged, which means swap rates will be positive. This technique is also known as a "Carry trade". The difference being that carry trades are usually long term.

i don't feel confident in this trade which can be good news as well, since most retail traders are confident with their positions but they lose more than they win. Psychology does have a place in this business. The lack of confidence stems from the fact that although traders are net long, the sentiment is not at an extreme level.