I’m not sure when you are going to read this article but I will like to show you how I pick my trades for the day. I believe that doing this will give you an idea of how you should trade. What you will notice is that I do not overtrade and that I am looking for either a 1 day long trade or even a weekly trade. All of my trades are set up to be directional day trades or swing trades that can earn a ton of forex pips. Either way, my trades are high probability trades.
So it is 9:43 AM on Monday and the market has opened for the US market. I am looking for plays on the EUR/USD USD/JPY and other major currency crosses. Since it is Monday, it is hard to find continuation plays. I call a continuation play as one where you can take the forex price action from the following day and choose direction based on engulfing candle chart patterns and gap ups. Since I do not have such data available to me, I will look for convergence over 5 different charts: The 5 minute chart is used for seeing what the market is doing now, the 15 minute is used to verify direction, the 1 hours chart is used to see what the market has done during the Euro session, and the 4 hours is used as a sort of medium term verifier.
When all of these charts line up in direction, I will use market sentiment to choose a directional trade. With this method, you will not see many trades but the one’s that you do see are high probability trades that are likely to go in your favor. As traders this is all we can hope for when trading.
This is sort of a meta trading system that relieves stress and reduces stress. I sometimes only make one directional trade a day and leave the computer. I have a stop loss set so that if the trade turns on me I will not lose too much money. My money management also has it so that I only trade a set amount of units per trade and I adjust this by the amount of money that is in my account. I always trade 3% of my current account balance and I never try to trade more if I lose.
So, tomorrow, when you take a look at the forex market in the morning try to look for directional convergence across several charts. Make a trade in the direction of the price, set a stop loss, and let the market do its thing. Trading is actually this easy and it doesn’t need to be stressful. This is a trading system that I use almost everyday. I also do more long term trading and short term trading as well. This is a method I use as my main technique. Give it a shot and you will see that it will work for you.