Welcome to my first thread!
A little about myself: I have been trading Forex for about 5 years now, I have bought and used every book/system you can think of. I have scalped 5min time frames through to position trades on the monthly time frames and incorporated just about every indicator you can think of along the way.
Now i am a little older and have more experience i trade a slightly simpler method learned mainly from traders threads on Forex Factory noticeably DanUK & James16.
This thread is going to be a record of my trades and my thinking behind them, it's mainly for my own record keeping and for me to refer back to in the future. But if anyone would like to post comments they are more than welcome.
*****Please note this is my trading journal only, in no way is anything in this thread to be considered trading advice. Trading is a dangerous business if you do not know what you are doing*****
Strategy Overview:
I will be mainly trading 4h, Daily & Weekly time frames, partly as i have a day job and partly to avoid the "Noise" i believe there to be on the smaller time frames.
Things to am looking for in order to place a trade:
1. Trend: I would normally like to see the market favoring one direction over another. I will sometimes take a trade in a consolidating market if it has established very strong Support and Resistance zones, but on a whole i would like to see a trend.
2. Support & Resistance: This for me is required in order for me to place a trade. I look at these areas as giving me a slight edge in the fact that i believe buy and sell order accumulate at these points which could in turn more the market. I prefer horizontal Support or Resistance zones but will also mark and trade from trend lines as well. Basically any area i think other traders will pay attention to and build orders at i am interested in. You will notice i use the term "zone" as Support or Resistance is not always an exact point, often it is a zone of several pips.
3. Candles: When price arrives at a Support or Resistance zone i need a way to establish if the zone will hold or break as not every zone will have sufficient orders accumulated to move price in my opinion. I use Japanese candles as my way of reading price as it enters Support or Resistance. I will go over these in upcoming posts when i have more time.
4. Time Frames: I will often drop down a time frame before entering a trade. Say for instance i am watching price on the Daily chart arrive at a support zone and i am looking for a candle stick pattern to trade from. I will often drop down to the 4h time frame for a sharper look at what price is doing at the moment and i may find patterns to trade from there.
5. Consolidation and Break Outs: When price has moved to one of my areas of support or resistance, if i do drop a time frame for a closer look to see what is happening, i often find price is ranging for a short period of time. If for example i have marked a support zone on my charts as price moves down to that zone and triggers the pending long positions placed by other traders they are battling against the existing short sellers this often results in a sideways market for a short period of time. This is when i like to trade a Breakout of this sideways consolidation in the direction of the prevailing trend.
6. Money Management: Probably the most important part of my trading, i will only enter a trade if i can see a 2:1 Risk Reward in the trade. It could be a great setup with the trend and the candle sticks showing me great price action but all that is useless if i am trading straight into an area of support or resistance. The other great thing about only looking for a 2:1 RR or above is if i was only right half the time i can still make a great monthly return. I currently trade 3% of my account per trade.
More to follow.
A little about myself: I have been trading Forex for about 5 years now, I have bought and used every book/system you can think of. I have scalped 5min time frames through to position trades on the monthly time frames and incorporated just about every indicator you can think of along the way.
Now i am a little older and have more experience i trade a slightly simpler method learned mainly from traders threads on Forex Factory noticeably DanUK & James16.
This thread is going to be a record of my trades and my thinking behind them, it's mainly for my own record keeping and for me to refer back to in the future. But if anyone would like to post comments they are more than welcome.
*****Please note this is my trading journal only, in no way is anything in this thread to be considered trading advice. Trading is a dangerous business if you do not know what you are doing*****
Strategy Overview:
I will be mainly trading 4h, Daily & Weekly time frames, partly as i have a day job and partly to avoid the "Noise" i believe there to be on the smaller time frames.
Things to am looking for in order to place a trade:
1. Trend: I would normally like to see the market favoring one direction over another. I will sometimes take a trade in a consolidating market if it has established very strong Support and Resistance zones, but on a whole i would like to see a trend.
2. Support & Resistance: This for me is required in order for me to place a trade. I look at these areas as giving me a slight edge in the fact that i believe buy and sell order accumulate at these points which could in turn more the market. I prefer horizontal Support or Resistance zones but will also mark and trade from trend lines as well. Basically any area i think other traders will pay attention to and build orders at i am interested in. You will notice i use the term "zone" as Support or Resistance is not always an exact point, often it is a zone of several pips.
3. Candles: When price arrives at a Support or Resistance zone i need a way to establish if the zone will hold or break as not every zone will have sufficient orders accumulated to move price in my opinion. I use Japanese candles as my way of reading price as it enters Support or Resistance. I will go over these in upcoming posts when i have more time.
4. Time Frames: I will often drop down a time frame before entering a trade. Say for instance i am watching price on the Daily chart arrive at a support zone and i am looking for a candle stick pattern to trade from. I will often drop down to the 4h time frame for a sharper look at what price is doing at the moment and i may find patterns to trade from there.
5. Consolidation and Break Outs: When price has moved to one of my areas of support or resistance, if i do drop a time frame for a closer look to see what is happening, i often find price is ranging for a short period of time. If for example i have marked a support zone on my charts as price moves down to that zone and triggers the pending long positions placed by other traders they are battling against the existing short sellers this often results in a sideways market for a short period of time. This is when i like to trade a Breakout of this sideways consolidation in the direction of the prevailing trend.
6. Money Management: Probably the most important part of my trading, i will only enter a trade if i can see a 2:1 Risk Reward in the trade. It could be a great setup with the trend and the candle sticks showing me great price action but all that is useless if i am trading straight into an area of support or resistance. The other great thing about only looking for a 2:1 RR or above is if i was only right half the time i can still make a great monthly return. I currently trade 3% of my account per trade.
More to follow.
Looking for a x2 Risk Reward.
