■ Hi and Welcome !
This marks what I anticipate to be my final and, hopefully, my most substantial contribution to Forex Factory.
Below are the most important aspects about how, what and why I trade in no particular order but before diving into the details of the content that you are about to explore, allow me to introduce myself.
I have been trading in the Forex market for over two decades, albeit with limited success. Throughout this period, I have experimented with a good amount of techniques and time frames, some automated, some manual, much like many people in this community. Today, I find myself at a moment where I realize the swift passage of time and recognize the imperative need for success. After some introspection and exhaustive research, I have arrived at this point, ready to share what I believe to be the culmination of my best efforts in trading, hoping that my beliefs will now convert into reality, I offer here some of my knowledge in the hope that you might glean valuable insights or who knows, even strategies from it.
■ Why this thread.
In my quest for a suitable thread, and I explored various of them here, I found none that were aligned with my needs and personality. I really think that my trading technique and style that I have recently adopted is very unique, you shouldn’t find anything similar in another place here. Exposing my ideas here is also a means of self-challenge, fostering accountability for my trading decisions.
■ What will you find here.
This space does not expose a trading system. Instead, I will delineate my trading insights and share my live trade entries and thoughts along with them. My results will be transparent, this allows you to evaluate my performance. You are free to interpret my entries as suggestions for your trading. Likewise, I welcome your insights, provided they align with my temporality and instrument. I am primarily a swing trader trading only EURUSD, please don’t post about intraday or other pair here, thanks.
■ The Eureka moment !
In late July of 2023 I finally discovered that momentum was the key ingredient that I was missing during my long journey. When I started back-testing it, I soon realized that it was in fact the most important piece of information that I was just not using and how blind I had been in past years. I won't pretend that I master it, as every new printed bar in the chart is unique in time and character, I just understand its language better.
■ Logically moving from a technical analyst to a momentum analyst.
From now on, I emphasize the significance of price action and momentum over any other technical indicator.
The years drawing trend lines, supports and resistances are definitively behind me, Momentum is my new religion.
Fundamental events undoubtedly drive market movements, yet their impact is ultimately reflected in price action and strength. Technical analysis, with its inherent failures, contrasts with the reliability of observing price movements over time. I advocate for giving the price adequate time to reveal its trajectory and following its lead, Once you know how to do that, you realize, in fact, that you need nothing else.
■ Momentum.
Detecting momentum shifts is pivotal in my trading today. I define momentum as the result of three components, Price Action, Strength and Follow Through. While identifying momentum in a robust trend is straightforward, it becomes difficult during pauses, when the market seems to hesitate between a continuation or a reversal. I have developed techniques based on extensive historical backtests to discern these shifts but I must acknowledge that their effectiveness may vary over time and that they are sometimes difficult to apply.
■ What do I trade, how and where.
I exclusively trade the EURUSD pair due to its high trading volume and the alignment of EU and US markets with my daily schedule in Central Europe. While the specifics of my trading rules remain private, I use publicly available indicators to gauge momentum. Additionally, I also use the SMA 100 as a direction reminder tool and even if I sometimes look at the daily and weekly charts to listen to what they have to say, I gauge the momentum and execute my trades exclusively on the 4-hour chart.
Regarding my trade execution, I have conceptualized a trade management approach that I call "Win or Die" wherein every trade either reaches the stop loss region or emerges as a winner. This philosophy eliminates setting a break-even point after a certain profit margin, giving trades all available space until a clear change in direction or a stop loss situation appears. While losing trades should tend to be brief, winning trades may span from 2 weeks to 1 month. To the contrary of the Stop Loss which is well defined 30 pips away from entry, I don't use predefined targets, it is momentum changing direction in a clear way that defines my take profit point.
■ Risk.
It goes without saying that understanding risk is paramount in trading.
When most traders adhere to the 2% risk rule, I advocate for a more personalized approach, considering individual circumstances and trading goals. My trades entail a risk ranging from 10% to 20% over 30 pips on a closing basis but I plan to progressively reduce this risk mainly to maintain a balance between growth and stability of equity.
■ Transparency.
To ensure transparency, a live explorer is attached to the thread, verifying the authenticity of my trades. This transparency underscores my commitment to practice what I preach. Only trades after August 23 follow the approach discussed here.
■ Quality.
In this thread, the emphasis lies on the quality rather than the quantity. In addition to continuously gauging the momentum, I meticulously focus on entry and exit points, the pivotal moments in any trade, while showing patience to allow trades sufficient time to unfold. This approach acknowledges the inevitability of significant retracements before the substantial or final movement occur.
■ Professionalism.
Over time, my objective is to cultivate a disciplined focus on market momentum, ensuring constant mental alignment with the prevailing market sentiment throughout the trading day. This approach should allow me to take timely and well-considered actions in response to both anticipated or unforeseen market shifts. Regardless of the outcome, momentum synchronized trading under any circumstance, will undoubtedly boost my transition from an amateur trader into a professional one and above all, a profitable one.
■ Final Words.
Your contributions, inquiries, and constructive remarks are welcomed here. However, discussions related to scalping or any other non fitting trading style will not find relevance in this thread. My intention is not to prove myself to others but to remain accountable to my own standards. I print my thoughts and my trade decisions here for me to keep a trace of when and why I did what, in the spirit of constant and continuous improvement. I hope that you can find value in it, much as I have found in other threads on Forex Factory in the past ■
This marks what I anticipate to be my final and, hopefully, my most substantial contribution to Forex Factory.
Below are the most important aspects about how, what and why I trade in no particular order but before diving into the details of the content that you are about to explore, allow me to introduce myself.
I have been trading in the Forex market for over two decades, albeit with limited success. Throughout this period, I have experimented with a good amount of techniques and time frames, some automated, some manual, much like many people in this community. Today, I find myself at a moment where I realize the swift passage of time and recognize the imperative need for success. After some introspection and exhaustive research, I have arrived at this point, ready to share what I believe to be the culmination of my best efforts in trading, hoping that my beliefs will now convert into reality, I offer here some of my knowledge in the hope that you might glean valuable insights or who knows, even strategies from it.
■ Why this thread.
In my quest for a suitable thread, and I explored various of them here, I found none that were aligned with my needs and personality. I really think that my trading technique and style that I have recently adopted is very unique, you shouldn’t find anything similar in another place here. Exposing my ideas here is also a means of self-challenge, fostering accountability for my trading decisions.
■ What will you find here.
This space does not expose a trading system. Instead, I will delineate my trading insights and share my live trade entries and thoughts along with them. My results will be transparent, this allows you to evaluate my performance. You are free to interpret my entries as suggestions for your trading. Likewise, I welcome your insights, provided they align with my temporality and instrument. I am primarily a swing trader trading only EURUSD, please don’t post about intraday or other pair here, thanks.
■ The Eureka moment !
In late July of 2023 I finally discovered that momentum was the key ingredient that I was missing during my long journey. When I started back-testing it, I soon realized that it was in fact the most important piece of information that I was just not using and how blind I had been in past years. I won't pretend that I master it, as every new printed bar in the chart is unique in time and character, I just understand its language better.
■ Logically moving from a technical analyst to a momentum analyst.
From now on, I emphasize the significance of price action and momentum over any other technical indicator.
The years drawing trend lines, supports and resistances are definitively behind me, Momentum is my new religion.
Fundamental events undoubtedly drive market movements, yet their impact is ultimately reflected in price action and strength. Technical analysis, with its inherent failures, contrasts with the reliability of observing price movements over time. I advocate for giving the price adequate time to reveal its trajectory and following its lead, Once you know how to do that, you realize, in fact, that you need nothing else.
■ Momentum.
Detecting momentum shifts is pivotal in my trading today. I define momentum as the result of three components, Price Action, Strength and Follow Through. While identifying momentum in a robust trend is straightforward, it becomes difficult during pauses, when the market seems to hesitate between a continuation or a reversal. I have developed techniques based on extensive historical backtests to discern these shifts but I must acknowledge that their effectiveness may vary over time and that they are sometimes difficult to apply.
■ What do I trade, how and where.
I exclusively trade the EURUSD pair due to its high trading volume and the alignment of EU and US markets with my daily schedule in Central Europe. While the specifics of my trading rules remain private, I use publicly available indicators to gauge momentum. Additionally, I also use the SMA 100 as a direction reminder tool and even if I sometimes look at the daily and weekly charts to listen to what they have to say, I gauge the momentum and execute my trades exclusively on the 4-hour chart.
Regarding my trade execution, I have conceptualized a trade management approach that I call "Win or Die" wherein every trade either reaches the stop loss region or emerges as a winner. This philosophy eliminates setting a break-even point after a certain profit margin, giving trades all available space until a clear change in direction or a stop loss situation appears. While losing trades should tend to be brief, winning trades may span from 2 weeks to 1 month. To the contrary of the Stop Loss which is well defined 30 pips away from entry, I don't use predefined targets, it is momentum changing direction in a clear way that defines my take profit point.
■ Risk.
It goes without saying that understanding risk is paramount in trading.
When most traders adhere to the 2% risk rule, I advocate for a more personalized approach, considering individual circumstances and trading goals. My trades entail a risk ranging from 10% to 20% over 30 pips on a closing basis but I plan to progressively reduce this risk mainly to maintain a balance between growth and stability of equity.
■ Transparency.
To ensure transparency, a live explorer is attached to the thread, verifying the authenticity of my trades. This transparency underscores my commitment to practice what I preach. Only trades after August 23 follow the approach discussed here.
■ Quality.
In this thread, the emphasis lies on the quality rather than the quantity. In addition to continuously gauging the momentum, I meticulously focus on entry and exit points, the pivotal moments in any trade, while showing patience to allow trades sufficient time to unfold. This approach acknowledges the inevitability of significant retracements before the substantial or final movement occur.
■ Professionalism.
Over time, my objective is to cultivate a disciplined focus on market momentum, ensuring constant mental alignment with the prevailing market sentiment throughout the trading day. This approach should allow me to take timely and well-considered actions in response to both anticipated or unforeseen market shifts. Regardless of the outcome, momentum synchronized trading under any circumstance, will undoubtedly boost my transition from an amateur trader into a professional one and above all, a profitable one.
■ Final Words.
Your contributions, inquiries, and constructive remarks are welcomed here. However, discussions related to scalping or any other non fitting trading style will not find relevance in this thread. My intention is not to prove myself to others but to remain accountable to my own standards. I print my thoughts and my trade decisions here for me to keep a trace of when and why I did what, in the spirit of constant and continuous improvement. I hope that you can find value in it, much as I have found in other threads on Forex Factory in the past ■
Simplicity is the Ultimate Sophistication.