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Dale

Basic rules for trading my Swing levelsBASIC RULES FOR TRADING MY SWING TRADE LEVELS : SL/PT For every swing trade I use different SL. It is because I search the chart for the best place for the stop loss order. My PT depends on how far my SL is. Ideally the distance to PT is more or less the same as the distance to my previously determined SL (if I choose SL for example 100 pips, I use PT also around 100 pips). This is because I like Risk Reward Ratio close to 1:1. However, there are more ways to trade my swing levels. Here are some with very good results: a. Risk Reward Ratio 1:1 : When trading this way I don’t move my SL. There are only two possible outcomes: full SL or full PT. If you don’t feel that agressive you can move your SL in simillar way like in intraday trading i.e.: move SL below/above the reaction or at BE when you are about 70 – 80 % in open profit. b. Risk Reward Ratio 1:2: You try to gain 2x more than you risk. When price reaches 50 % of your profit you move your SL below/above the reaction. For example: your SL is 120 pips so you want PT 240 pips. When the price moves 120 pips in your favour (50 %) you move your SL below/above the reaction. This method has very good results but is quite mentally challenging. c. The same as previous one with the exception that you don’t move your SL below/above reaction but at your break even level. d. Risk Reward Ratio market dependant: Risk Reward Ratio in this method ranges from 1:1 to 1:2 depending on the market conditions. This requires some skill to determine how far the move could go. I use this method when I want more than 1:1 but don’t want to go for Risk Reward Ratio 1:2 because I think it is too risky. My most frequent risk reward ratio with this method is around 1:1,5 *I use limit orders when trading swing trades. Macroeconomic events I trade my swing positions even during significant (marked in red) macroeconomic news. There are so many of them every week that if I wanted to quit my position before every such event the position would just rarely have enough time to reach my PT which is usually over 80 pips far.This approach may look a bit agressive but it is working nicely. There is one exception: I close all my swing positions and all pending orders before the most significant news. Those are news that are issued by central banks and concern their monetary policy. Here are some of them: a. Monetary Policy Statement and BOJ Policy Rate (JPY) b. FOMC Statement and Federal Funds Rate (USD) c. Federal Funds Rate and Official Bank Rate (GBP) d. RBA Monetary Policy Statement and Cash Rate (AUD) e. RBNZ Rate Statement and Official Cash Rate (NZD) f. Bank of Canada Rate Statement and Bank of Canada Monetary Policy Report (CAD) g. Minimum Bid Rate and ECB Press Conference (EUR) h. Some other significant news concerning Brexit, US presidental election, significant news concerning Grexit, etc... *If you trade your own swing trades with SL tighter than about 50 pips I suggest you adapt the rules and close the trades even before less significant macro events.
by Trader_Dale
2
Basic rules for trading my intraday levelsTrading rules for intraday levels 1 . Understanding levels - I trade all my levels when the price reaches them. If I have for example 2 short levels it doesn’t mean that price will go up to reach those two levels nor does it mean that I think the market is going down. What it means is: If the price reaches 1st short level – I go in the short trade. Using rules I wrote below. If the price reaches the 2nd short level I go again in a short position using the same rules. 2. Profit Target/Stop loss - Profit target: 10 pips. - Stop loss: 12 pips. - I use this PT/SL because it suits me personally. It is also possible to go for much bigger profit targets because there is strong reaction to my levels quite often. I recommend trying 1st profit target 10 pips and 2nd profit target for example 20 pips (or use some type of trailing). 3. Securing your position - If the market went your way at least 7-8 or more pips it is possible to move SL. This way you can prevent turning a winner into a loser. You can move SL either to the place where the market turned or to Break even level. If you move the stop loss or not depends on your own judgement and your risk aversion. 4. When I consider the level already “tested“ - If the market turns 3 or less pips before reaching the intraday level and makes 8 or more pips consider the level already tested and do not trade it anymore. This rule is not so clear-cut. For example if the market turns 2 pips before my level and makes 12 pip reaction – I won’t take the trade anymore. However if the market turns 3 pips sooner and makes not so strong 8 pip reaction I may still take the trade. 5. Macroeconomic news - Never trade during significant macroeconomic news. Close all intraday trades at least 3 minutes before the announcement no matter if they are in open profit or losing. You can trade again if you see that there is no reaction to the news or wait about 10 minutes after the announcement (or better – after the macro volatility subsides). 6. Limit vs. market orders - For intraday trades I use market orders only. I use alarms that I put few pips before the levels so I don’t miss any. - It is possible to use limit orders but you need to be aware of these factors: o Macroeconomic news o Situations when market turns a bit sooner making the level not valid anymore. o Sometimes with market order you can jump in the trade for a slightly better price. o Securing the position is harder when away from computer. o 7. How long are levels valid - My intraday levels are valid until they are tested or until the next levels are published. - My levels work for EU, US and ASIAN trading session. - I usuallly don’t trade Asian session because I need to sleep from time to time
by Trader_Dale