Sharing my trading method

Hey Forex Factory Traders, Its been a little while since i come on here. Been a bit busy but anyway I saw some trading threads regarding sharing profitable methods or styles and i would like to share a method i use that works pretty well. This may be a bit long but ill try to keep it as short as possible while explaining. Also, by no means is this a "magic" or "Super" method but very simple that im sure millions of traders use out there, however, many traders fail to see or use. Anyway im just trying to help fellow traders who may need some help. here we go.

I use bestfreecharts.com so thats what i am going to show here.

Lets take a Recent E/U 1HR chart....... First thing i do is zoom out as much as i can to get a zoomed out look at what price has been doing....

Second,... I Use a tool called "Regression Channel"..

Third,... I draw the channel from the start of the zoomed out chart to the end of where price is currently at OR adjust the trend so that the upper trendlines align with the tip of price reversal points.

Fourth,.... now that we have our zoomed out chart with the channels, Where do we enter? In this particular example. i will mark areas of decent shorting spots and why.


I will post some more examples. Again this is very simple stuff that many traders use and works quite well.

GBP/AUD, Pretty much same concept as above. Nothing exciting just sharing some ideas.

Hi NYWallSt,

what charting package are you using?

cheers

I use FXCM to execute trades but the charting i use is BestFreeCharts.com

Hi,

First off, if your trading approach works for you I congratulate you and hope you can read the below not as criticism but only as input meant to be helpful.

I had two thoughts when I read your posts.

 

1. If you're executing your trades on FXCM it could be better to have the FXCM prices fed to your charts. FXCM provides MT4 for charting (and trading with some account types), and MT4 lets you draw Linear Regression Channels (from the Insert/Channels menu). So this could be a good way to get reliable charts, especially when trading shorter timeframes.
2. In your examples you used a somewhat unorthodox way of drawing the channels. Most traders would put the first point of the channel on the beginning of a new trend; you put it somewhat randomly in mid-trend. In your screenshots this happened to describe support and resistance levels pretty accurately, but you're putting yourself at risk of fitting the channel to what you want to see and ending up in bad trades.
   One common approach is to zoom out a step or two. If you're trading from the H1 chart, zoom to the H4 or D1 chart and draw the channel, then switch back to the timeframe you use for your trades (H1). That gives you a chance to be more objective in chosing the touch points. (This incidentally also works well with drawing Andrew's Pitchforks or free-hand support/resistance lines.)
   If you want to totally take the subjectivity out, I suggest to use Bollinger Bands instead. They calculate the deviation from the center line (a simple moving average) based on past market data. An added benefit is that they also take into account volatility, thus giving hints on when is a good time to trade and when to stay out.

I hope this is useful for you and the readers of your thread!

Good trading,
Jesper