Momentum Trading

Time to give back to the community. I won't be posting trades but will attach a trade explorer and engage people as to what I find most important to good trading and general trading wisdom learnt over my 6 year journey.

In a general sense I trade breakouts in strong trends, and I aim to take singles rather than trying for home runs, as I find that if I let my trades run and give myself plenty of room I forego too much profit.

I trade without using any indicators or trend lines and no support/resistance or supply/demand areas. I keep things very simple by simply having a required market condition, and then a specific price action entry.

My entries are with stop orders, and I sometimes wonder if I could even be profitable without them. Most of my orders do not get taken out, and I end up deleting the order because the price action entry fails. Every time I don't get entered into the market I feel like I have saved money.

I don't take many trades a day. Often if my first trade is profitable, I will not take another. It sometimes takes me hours to wait for and find a trade, so after I finish with a trade I will take a half hour or so off to reboot a little before looking for another trade.

There are three basic market types, they are; ranging, trending or parabolic.

The type of market which holds the highest profit potential with respect to one single trade is a parabolic trend.

So why not limit your trading simply to trading parabolic trends?

I spent so many years cycling through different entries with various levels of success, but I didn't fully appreciate for a long time that maybe the market condition was perhaps the most important factor to the success of my entry. I don't mean that I wasn't waiting for trends prior to entry, I mean that I didnt appreciate the important difference between a trend and a parabolic trend.

I come from a family of hoarders, and have always enjoyed collecting mostly useless trading trinkets. Those include edges i will never use, indicators i will never trade with, and the last few years i have collected a number of market scanning applications.

I was never able to make the market scanning applications work for me consistently until i started focusing on parabolic trends. The benefit of a good few scanning apps is that they can reduce the amount of time that you have to monitor and watch the market.

I have most likely finished trading today with a 1% gain from a 1% risk and only looked at the market for a total of about 20 minutes, 10 of those were whilst being in a trade. I acknowledge that traders that are new should focus on markets and watch them as much as they can in order to understand its flow and rhythm, but when you are trading a serious account for real, i find time spent looking at the market can actually be counterproductive.

It is different for everyone, but looking at the market is a habit forming activity, it is very addictive. While you are looking at the market, your mind is very often busy trying to talk you into taking a trade, and often as fallible traders - we take it, despite having solid entry criteria. In fact, the better your market edge, the harder it often can be not to take a random trade. If you are winning 80% of your trades at 1:1 risk/reward, then as long as you maintain strict money management, no single trade can hurt you, therefore taking a random trade is almost a win/win, even when it loses lol. It fulfills your psychological want for a quick hit, it could turn into a home run, and random trades are much more fun than system trades, because you know how your system trades turn out, so they eventually becomes boring.

If i take another trade today it won't be because i went back and had a look at the market per se, or one of the 22+ pairs i trade, it will be because something interesting showed up on a scanner, and i then drilled down into a pair for a closer look, and came across a setup developing.

Lazy day but got out of jail. Took an entry off a 2 min chart with insufficient analysis, and prob a bit too heavy a position. Not proud of myself but will get back on track tommorrow.

If u take a 1% profit, why get back into the washing mashine?

1% a day is a rock star performance, nuff said.

The trade i took yesterday was okay, though in hindsight possibly the momentum was questionable.

Given the momentum was largely based on the Euro open i am happy with it, I had to stalk the trade on a few timeframes but i finally got an entry.

Gave my trade too much room, mid way i saw momentum shift direction but i didn't pull the plug like i could have. 1.6% loss because of slippage and because i didn't pull the plug quick enough. Overall not too bad, though any loss above 1.3 is larger than i am happy with.


Took a trade today that was against my rules and took a 1.3% loss. As per my trading rules, if i take a trade that is not there I must stop trading for the week - so i get a few days to think about how much of an idiot i am. Seeya next week, hopefully with some pictures around parabolic trends and momentum.