S/R Levels, No Indicators, Price Action

Hi friends,
After many years of trading very different indicators and systems I found my own system that has nothing with indicators.
I am trading on naked charts. I am not professional trader and can not write my trading system line by line for you (when I complete my system, I will write it here in the first post), but can show in this journal what is that I am seeing and doing in market.
I have created a Trading Explorer, specially for this journal and this system, a real live account with a small balance, because I believe this system can work on small accounts too.

Your comments and ideas are welcomed.

Tehmut

This system is useful for all timeframes. Higher timeframes are more low-risk than other, but I prefer to work on 5minute charts.
My SL and TP are fixed, except in situations where I think the price is going to have a wild move on my side.
So, it's better for me to trade on one pair because on 5m chart I can not make good decisions on different pairs.
Trading on EU is good for volume of trading on this pair and because of low spread.

Shorting the story, in next posts show you how am I making the entries.

On this chart you can see that price at left arrow didn't close above 1.11145 for 45-50 minutes. When the price reach that level, open short, sell EU.
On 2nd arrow, price is below 1.1113 for a 15 minutes. So, open short and see how the price is going down.
Stop loss on all EU trades is 5 pips because it is an average moving of price in 5m chart and Take profit is 7 pips because I want to have a big chance of winning.
Take profit is bigger than Stop loss because of commission and spreads.

These examples are all for showing you what my system is. This chart is not enough to show that, but I'm going to keep posting to make all things clear.

Tehmut

Why I insist on going short on previous chart?
Look at H1 chart!
There is a 17 or 18 bars in 4 days before when price came to 1.1118 and didn't close above it.

This is how Price talking to you. You must only listen and make pips.

Live example.

Price was below 1.1135-40 for more than 3 hours. (see blue rectangle)

Big short candle came back to this level.

Let's see what's going on

TP hit.

Forex is not the magic. It's a simple as we are.

But what if SL was hit?
I will write something about money management in my system in next days.

Tehmut

LIVE.

Is there any need for indicators?

Changed my TP to 14 pips because the price has good movement. But price came back. So what's next??

Price went back but it has a S/R level on its backway also. So, it is more difficult for price to hit SL than TP.

Look and wait. Or you can go and drink a cup of tea. Pips working without you.

SL hit. Problem? Not at all.
Next trade with same SL and TP on the same pair with double lot size, OR same lot size with doubled SL and TP BUT ON HIGHER timeframe.
I choose double lot size, because my winning ratio is above 50% and it's a very low possibility to lose more than 4-5 trades one after other.

Tehmut

I must work harder on my money management, because I want to make this system profitable on small balances.
Bigger drowdown means the end.
Strategy is working, but the strategy is only the small part of a winning system in which money management, daily/weekly goals, daily/weekly stops are very very important.
I have solution for mm, but not tested yet.

Best signal for taking the trade.
Both bars have wicks.
Wicks must be on opposite side of second bar's direction. If bar is bearish, wicks must be above, and if bar is bullish wicks must be below bars.
Second bar is bigger than previous.
Green arrow shows good entry, but red arrow is bad entry because the second bar is smaller than previous.

There is more details about wick-entries I'll post later.

When I have enough time to trade and monitor my trades I use 5 pip SL and 7 pip TP. When I am busy I change SL to 10 and TP to 14.
All these options are for 5m chart. On higher timeframes, all the stops must be higher.
15min 10-20sl 14-28tp
30min 15-30sl 21-42tp
and so on...

Tehmut

I am trading news with no tp. Looking chart. Standard SL.

0.04 lot size, SL 5 pips, TP 7 pips = 0.02 lot size, SL 10 pips, TP 14 pips

If you have a problem with doubling lot size for returning back your loss (because of margin limits), you can double SL and TP.
Be aware you make entry based on higher timeframe if you are going for bigger SL and TP.

I did it tonight and returned a loss.

It is more conservative to make TP 3 or 4 times bigger than SL.
It helps to have not big risk, but I believe that this system is profitable very good and I can trade more aggressive.

Dont try my money management, if you have not experience in trading. Only see what I do with my account.

Today results:

11 trades
4 win
7 loss
0 pips earned
3.81% return

Don't try at home!

I set my daily goals in profit not in pips. It is not important to me how much pips I earn daily.

How much profit is enough?
How much loss is enough?

When you set these goals, find out that making pips does not make sense, nor win ratio.

Everyone knows it, but a few traders live it.

Waiting for candle close is very important.

I dont wait for it just in two cases:
a) the price hit the very strong SR level
b) I am not in series of more than two losses

Tehmut

I look at higher TF when trading on m5.
See m30 chart below, and then trade on m5.
Big picture always.

Which one is stronger? Trendline or Support?

Lets see the big picture.

Both are very strong lines. Today stability of EU pair is projected by these two lines/levels.

Expecting a big move on every side price goes more than 20 pips. I think it will be downside, EU short.