Category: articles

Trade Fearlessly&Grow Your Account

Grow Your Account

“I am the Danger!” Walter White’s famous words from the TV series, Breaking Bad. He was a science teacher who, after finding out he was terminally ill, quit his 2nd job at a car wash with an abusive boss, confronted his disabled son’s bullies, and cooked the finest meth the fictional world has ever seen. He meddled with fearsome drug lords and made big bucks. He knew his life will surely and quickly come to an end. It triggered something inside that drowned out the coward in him and unleashed his untamed beast.

In this article, I want to bring you the logic behind unlocking your fearlessness. You could say this is an actionable article, not just merely informative. At the end of this article, you’ll understand what drives fear in traders. Why do we close out early, place impulsive trades and take unplanned positions? Assuming you are a sensible individual and can reflect on what drives certain costly behaviors, you should be at the beginning of the end to a seemingly uncontrollable habit. Read More

The Extra Mile

Why and how much market moves;Behind every temporary 50 pip move there is a tiny reason, like options and intraday news shocks etc…Behind fast and big moves (up to daily average true range) is almost always speculators covering their short or long positions. Read More

Tutorial: AUDUSD Yellen’s speech trade

When I set out with, I wanted to create a learning environment that would allow peers to draw from the most powerful trading methods freely available. This is the first of hopefully many tutorials explaining; market environment, sentiment analysis, technical levels, volume, and price action that can capture massive moves. This episode focuses on a AUDUSD short. Read More

Guest Post: David Belle about Risk Management

Risk management is key to trading. Without risk management, you can have the best strategy in the world, slowly grind down an account due to poor risk management.
There are several key principles that I follow with managing risk & managing a position while in a trade.
Firstly, I do not believe in cutting your winners short when your stop is managed with the correct risk parameters. If you take a quantitative based approach to the markets, where you look at your stats over a good sample size, you should have 100% faith in these stats as long as they are robust (have significance with little error/bias) and the conclusion is a positive expectancy. The second you begin to cut losers short, you are applying human impact to your robotic approach. How do you know that your trade would have hit your stop? By cutting it short you are affecting your stats and applying variance on certain parameters to your original data set. Leave the trade alone once you’ve entered it.
Secondly, your risk should be based upon market structure. Take a look here.
Based on how I look at the market, I would expect the market to not push past an upside rounded retest, since that is where further sellers are likely to be introduced (based on what has happened at the highs). This means I want to ensure than my 1% risk is adjusted to the market structure, and this means that I have to place my stop above where I believe the supply to be exhausted (above the rounded retest). A quick equation you can use to find pip value for 1% risk is (Account size/100)/stop size in pips = value per point. If you then know approximate workings for lot sizing, you can enter correct risk parameters quickly.
Managing your trade is also key. One thing I do is look for opportunities on the way down. This is how you grow an account. Look for the same entry parameters during your trade as those that you had for the original position. Tighten up your stops as you go, moving each ‘old’ stop to where your new entry stop is. This way you’re locking in all of your profits each time on each leg, with no way to lose money on the next new position (unless a broker goes tits up which isn’t your fault).
Something else to think about is to lower your risk when going through ‘bad’ periods. Trade 0.5% or even 0.25% risk and scale in when you are confident on your position (and following the same advice as in the previous paragraph). This not only allows you to stay in the game but also it doesn’t compromise any opportunities that you might have because of any ill confidence (you’re only trading 0.25% after all).
The majority of this advice is for swing trading/slightly longer term trading, however it can still be incorporated into short term trading as well. Price action is the same on all time frames after all… debatable…


David Belle

Insidebar Swing Trading

There are a several high probability scenarios in which insidebars (IBs) offer fantastic swing entries. And while it is crucial to pick the right wave when swing trading, the way IBs close is the main giveaway as to where it is headed next. Take note of the following properties before exploring different scenarios; Read More

Origins of S/D zones

Let’s face it the one thing as a supply and demand trader you are hoping for is once price moves back into the zone that there are orders left unfilled. That is the edge of the strategy. Reality is you never truly  and %100 know if market participants are likely to show interest in that particular level ever again. But there are clues beyond the charts that can aid us in identifying the importance and magnitude of S/D zones. Read More