Ok it took a year but I got it now...

S/R levels (with candlestick patterns/PA confirmation) is the basis of successful trading. If you want to add whatever indicators and bells/whistles you think will help you see that.

Now either I'm a genius for finally getting what many seem confused about or the last year of my life has been totally wasted, because you can read the above statement in almost any thread you stumble into.

While I'm typing here I might as well let you in on the other <irony>massive breakthroughs</irony> I've had in this first year:

Q) Can you make 10% a month? Can I make 10% a month? Can my uncle Phil make 10% a month - he has 7 toes on his left foot.

A) Get a grip, when you stop looking at the gains and concentrate on the trades you'll make money. From your records you can work out a net average that each trade will give you. You may be +ve either because make more than you risk, or win more times than you lose, or both. Does a trade need to be 1R+? No not if your hit rate is 90%. Horses for courses.

But lets assume for arguments sake that you take trades that are 2:1 and you win 50% of the time (you know this from your records). Lets also assume that you risk 1% of your account, because you read it somewhere... blah blah blah.

If in any given month you find 8 trades that meet your entry criteria, whatever you have decided that is - you will on average add 4% to you account that month. Find more you will add more, less and you will make less. Notice the bold on average here please, I'm assuming we all understand that concept.

Ok so now you can decide if you can make 10% a month, 1% a day, 5% a year or whatever other figure you have come up with. Please, please, please don't listen to other people telling you what they make or what they think you should be making. Your records will, in time, prove to you what you can expect and not hope to make. With increasing skill and knowledge you will increase your return as long as you keep your emotions in check though the process.

I have a good friend who I met after he moved to our city - to one of the roughest parts, and managed to get work in a sausage factory -lets just say he didn't have the best set of circumstances. I think this was 6 or 7 years ago now, maybe more I can't remember. Where is he today? Funny you should ask - he has a sizeable property portfolio and lives in a >£1mill house.

A friend who I used to play in a band with started his business with a £200 advert in a paper and a rented room. Today he has around 10 professionals working for him and takes on contracts for the NHS.

My brother is a black belt kickboxer, just setting up his own training business. What's so remarkable about this one? Well if you had seen his physique and lifestyle a few years back you would know why I bothered typing it.

I guess what I'm saying is set your own limits, you may make your fortune trading FX, you may not, that's not the point. It's down to you, not others opinions of what you should achieve.

Ok moving on now, we have a friend coming over, and I didn't think this would take as long as it has. I'll write in another post about 2 other things that I have understood to be very important:

1) trading the trade rather than your P/L statement
2) Not moving stops to BE.

Please understand I'm not writing with any agenda or even any authority, it's just here for anyone interested in a ~1year shortcut.

Dave.

So give yourself a pat on the back

Good stuff Dave ... with respect to moving SL to b/e ...you may want to do some additional research .... more often than not price comes back to retest the level u entered ...and stops out (especially in reversals) and you may end up missing a good move.

Sound money management is paramount importance.

There are no belts in kickboxing!

Indeed your completely right cause I know alot of traders making money using PA and S&R. A good thread for beginners is No Brainer Trades.

this thread can be fantastic all we need now is some sound and tested strategies with S/R,CANDLES PATTERN AND PRICE ACTION tht normally gives hit rate of 50% atleast

as everyone has different approach trading these above rule ,it be interesting to see and exchange idea's around trading it ,I will post the way I trade s/r levels ,when I have time over the weekend ,and how I look at them and where I find set-up to high probability r:r

thnx for starting this thread

Thank you all for the replies, I make a point in life of learning from people who are further down the road that I am travelling, rather than people who just talk able good fight.

@PeterFM, thank you for posting on this thread, I haven't read much of what you have shared, but I found your Help for Newbies thread to be very useful especially the section you devoted to quickly compounding account gains by using 0.01 lot increments.

@MktScape, I think that you may have misunderstood my position on moving stops - I completely agree with you that moving to BE in 90% (random picked from the air number) of situations is a bad idea.

@swingtraderf, I guess this shows how important it is to not believe what is typed recklessly on this or any other forum I will ask him if I have the wrong end of the stick the next time we meet.

I will add my remaining two points later, but I have to admit I was surprised to find 3 people ready to congratulate, misunderstand, and disagree with me all in the time it took me to cook chicken!


Dave.

@Spacetec we must have crossed over posting, I didn't intend to post suggestions on how to take trades, I'd much rather empower someone to learn and therefore believe in themselves than give advice. I know there are better teachers than I, but I also know there are many learning styles so I will add some charts as time allows - I can think of a few examples in the last week or so that gave a 100pip gain for a tiny ( ~10pip ) risk.

Moving on (in the direction of roast chicken and potatoes)

@swingtraderf thank you for posting the link to the No Brainer Trades thread, there is a lot to digest there! I found that a lot of the concepts there are conclusions I have come to myself without the underlying industry knowledge some of the posters have. I think I have some very interesting reading ahead of me in the next few days, especially as BRV suggests moving SL to BE at +20 pips! Thanks again for posting what appears to be a great resource.

In other news I spoke to my brother today and he confirmed that he is a Black Belt 1st Dan (or first degree) with the International Sport Kickboxing Association here in the UK. Which I believe reminds me it is not a good idea to take at face value everything you read on this or any other forum

All the best.


Dave.

Hey man. Glad you are making ground in the trading areana, but you sound as if you have a ways to go yet. Everyone hits this stage at some point - I found THE way to trade and this is the ONLY way to trade. The fact is that there are probably an infinite number of ways to pull a profit from the market and you have just stumbled on one that shows some real promise to you at this point in your trading career. I think this closed minded attitude (no offense intended, it is just a natural reaction to following so many faulse paths and finally stumbling on a promising one) is not very compatible with successfull trading. I may be wrong.

Good luck to you all the same

moving SL to BE or not doing so is a matter of personal preference, your entry strategy and risk profile. Personally I do move SL to BE risk only 10-20 pips per trade and still manage to do just fine. I do get stopped, but than I also re-enter if I feel good confidence in my setup

No thanks, you should certainly read through the nobrainertrades.com site as it contains alot of info. Your brother must have a black belt in karate because there are no levels to climb higher in kickbox. In karate we have kata's and certain moves we have to control before we can get the next belt. A black belt has it advantages but also alot of disadvantages here in the Netherlands; judges consider black belt fighters to use alot less violence when attacked . You forgot the karate in World Kickboxing and Karate Association. You should certainly pop in the trading room if you have any questions. Good luck.

Hi,

@Agro, thank you for you comments on the thread, you don't in anyway come over as offensive, and were we to meet hopefully you find me opposite of close minded. I work part of the week as an IT contractor, where constant learning is really a must and I cannot remain married to old products / concepts for very long!

I have thought about your comments and I haven't decided to change the statement at the top of the thread. As you say there are many ways to take money from the market, however what makes S/R different is that we know any trader from any part of the world can see these levels. This simply isn't true for for anything else, even fibs and diagonal trendlines have room for manoeuvre depending on timeframe / candle close / drawing preference.

So just to be clear I'm not saying that using indicators, fibs etc, is useless, what I am saying is:

Price reacts to key levels, which is why I called it 'the basis' for trading, if candles, indicators, fibs, lines, whatever help us to see this then yes I agree they are useful. If they are being used in isolation I would say (based on my learning so far) that you are missing out on the bigger picture.

@ruffryders I think it's best to move a SL to BE when price has cleared the next logical S/R level. Lets say for example I have entered just the wrong side of a S/R line,with my stop somewhere on the other side. I then move my stop to BE after 10 / 20 / whatever pips. While the trade may now be 'safer' to me the market has no knowledge of my entry point, only the S/R level near to it. In this case my trade can be taken out at BE even if I am 'right'. Yes I can then re-enter if I choose but I found this to get psychologically more difficult.

If I leave the original stop and it is hit, the trade was 'wrong' and I can get on with my day. Up until that point I am able to decide if the trade is not progressing as expected and cut it for a small gain or loss.

@Spacetec here is an example of a low risk trade on EUR/USD from last night. Hopefully you will see how this could be a profitable, low risk trade, using just S/R levels. In this case it was around 1:6 rather than the I mentioned 1:10 but I think it will give you the idea... right what are we looking at? See attachments below

M5 See how price charges up to the .000 level! what happens then? Answers on a postcard to... IT REACTS STRONGLY! See also that it is UNABLE TO CLOSE ABOVE. Follow along a couple more candles and what do you get A RETEST OFF THE LEVEL, correct well done. This gives us me real confidence to get a pinpoint entry, so WE SELL as close to that .000 level as we can. Look at the M1 or smaller at this point and you will see a opportunities to enter very close to that level. Where do we put the stop, well that's down to your confidence in your entry and how you read the previous PA. 1.38100 would be more than enough for me. You may choose the spike at 1.38170 plus the spread. What is the target? Do we shoot for a fixed R:R..? Erm,well we used PA for our entry PA for our stop and that's right we are using PA for our TP.

H1Here we can see where I have picked out the level for the TP, see how this level has functioned as both support and resistance in the past? We can expect price to again react in someway to this level. I have also marked on there a smaller level of resistance, here you could take out half of your trade to make the rest 'risk free' if you liked. Should you do this? I don't know, up to you.

DAILY Ideally we would like to leave some of the trade to run but the daily shows why I decided to take the 60pips and run - it was against the larger daily trend.

I have made huge amounts of demo money simply leaving part of a trade with a great entry to run with the trend. What I am now partially successful in is adding stacks to this on logical peaks / dips. Meaning i can grow my profit potential, whilst keeping the risk more or less constant.

Anyway, I hope some of this has been helpful. As I say I have been at this for a year now, so happy to concede I have some missing parts.

Just helping from where I am.


Dave.

Attaching images...

another example unfolding as I watch (I was on the phone to a client!)