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Moneymanagement

Golden profits - XAUUSD #AspredictedPre-BREXIT as usual I posted up some truly simple analysis for all to enjoy and hopefully profit from. My aim during this last few weeks has been to shuffle as much of my client wealth as possible away from FX pairs and into GOLD. Fortunately it was indeed the correct decision. For all intensive purposes I "predicted the future". As for the right here and now there is a great set up for binary options traders, for forex traders, for CFD traders.... For all traders :) Have a look at my analsis here, my BUY/CALL signals have all been hit this morning during EURO open. Currently managing funds for binary only with www.STBinary.com - Happy to chat here/skype/whatever if you want to know more :)
FX:XAUUSDLong
by STBinary
SP500 A serious SHORT?The FED will address the issue of interest rate % very shortly. With such a strong Dollar market the question most of us are asking concerning the S&P500 is whether or not we may finally reach up and break through the all time historical high of around 2130? Personally we feel that is highly unlikely, and instead we will see our lower level fib lines reached and broken over the next few weeks. Big opportunity to trade and profit here. Get in touch for more info or come and check the site www.STBinary.com
FX:SPX500Short
by STBinary
WHAT DO I SEE ACCORDING TO PRICE ACTION ON NZDUSD?so what do we see here? according to price action we see a nice bullish preceding trend thats gets stucked in a daily resistance area, and shows me an indecision candle ( also called dodji ) on a 8hr chart. Also we can see recent lower high, which is usually a good signal for taking a short. Taking this trade when price goes below the low of the indecision candle. going for a risk reward of 1:2.5 ( my minimun is 1:2) hopefully it will work.
Short
by daldertg
2
Crash Warning For Euro STOXX 50 Equity IndexRunning Alpha Capital Markets Intelligence re-iterates its warning posted on Jan 11th, 2016 to Global Investors of an Imminent and Persistent Crash, specifically for Euro STOXX 50 Equity Index ( Symbol FEZ ) . The benchmark European index, the Euro STOXX 50 should easily retest the crash lows of 2009; USA equity markets do not have a crash signal, but will experience heavy volatility in near term before turning euphoric with a powerful V-bottom recovery from 2016 into 2017. Euro STOXX 50 will see unprecedented volatility -- off the charts and likely accompanied by rapidly deteriorating fundamental and geo-political events. In summary, * Long USA Equity Leadership and Short Euro STOXX 50 Index is an opportunistic strategy for the environment upon us now through 2017. * It is likely that no matter how significant short term volatility gets in USA over the very near term, the persistent panic selling to hit Euro STOXX 50 Index across all time horizons from the near term to the long term will be so extreme that money flows will likely create an episode of strong relative outperformance in USA markets all the way into 2017.
AMEX:FEZShort
by SentimentNews
EURJPY: Back to Back Bat Patterns & A Video on Money Management Consolidation often breeds harmonic patterns & that's exactly what we're seeing here on the EURJPY hourly chart. Now we're still holding a partial position on yesterday's bullish bat pattern and if price action were to push up to our second targets that would give us the opportunity to put in an SAR and get involved in the bearish one that looks to be forming as well. Also I've been getting a lot of questions about money management lately. If you haven't seen this video already make sure you check it out as it should give you a better idea of the money management strategy that I use in my trading. youtu.be Akil Stokes Chief Currency Analyst & Trading Coach\ www.Tradeempowered.com
Short
by Akil_Stokes
12
EURUSD a little outlook for what to trade next weekIf you´ve been following me the euro have been very good to us this past weeks with 3 winning trades and 1 loss. For monday i´ve got a Bullish Cypher pattern if price heads south to but it up at strong Support. If price heads north we are gonna sell it at the blue Bat pattern at a lesser, but still good reistance area, but compared to the Cypher this pattern got a lot higher R:R so its well worth it. We always try to be one step ahead of the market, and put in orders when we don´t have any emotions aboute it. We use the IF THEN method to see, if this happens, we do that, and if it does this in stead, we do this in stead. We are planning for several senarios while we don´t have our emotions haning on the outside of our cloth and then we just stick with our analysis cause we know its tested and profitable so we just have to control out emotions, and focus on money management! A subject i see more and more here on TradingView not beeing giving much of a thought, but its almost more important than your trading method if you want to see the returns you are dreaming about. How come some people that have the same size account, makes the same amount of pips make a totaly different return on account. It´s MONEY MANAGEMENT the art of when to increase or decreace your position size! So please spend some of your weekend reading on Fixed Ratio money management vs. Smoothed Ratio money management, you will be amazed! I´ve got a starting point for you read the book by "Ryan Jones - The Trading Game Playing By The Numbers To Make Millions" It will change your trading career! Kind Regards Thomas Jeff
by UnknownUnicorn101425
12
Stop Losses, Love Them Or Hate ThemStop losses aim to end a trade when the market goes so far in the opposite direction, that the trade idea no longer makes sense. It’s the point of invalidation . Ideally, they get hit on bad trades only and not on good trades. The area between entry point and stop loss is a zone where the trade is at a loss, but can still recover. This is not an invalidation of the trade. It’s a balancing act : place the stop orders far enough beyond your entry point to give the trade room to breathe and allow the price to rebound in the profitable direction, yet close enough to it to protect your account against a big loss in case of an invalid setup. When you put on a trade, you take a risk. Acknowledging this means accepting this risk and quantifying it before you enter a trade. Not using a stop loss, to me signals not accepting the risk and thereby increasing it because if you don’t use a stop loss your account becomes one . I see not cutting losses early as a fear based trading error. I always try to trade another day and stops give me piece of mind. Automatic stops are even disconnection and hardware problem proof. Everything in trading is a trade off, so there are disadvantages: when it is hit and price reverses, or if its placed wrongly. My philosophy when managing a trade is that either I am right, or I should be out. So what is the ideal place for stop losses? Trying to answer this is like searching for Columbus´ egg . And I haven’t found it yet. It’s a personal decision and I have no overarching rule. For each play in my playbook, I describe where to put the stop loss. I don’t use a fixed amount of pips; in stead I let the trade setup conditions dictate its position. With 5-point retracement structures like the Bat pattern this would be beyond the X-point (because if price moves across this level, then it was not a retracement structure and if I am not right, I should be out). For 2618 plays this would be beyond the tops / bottoms, for channel trades beyond the trend lines and for other plays I use support and resistance levels. I always put the stop losses at a certain distance of these invalidation points, as price may pierce through them before reversing. How far they are placed from my entry point varies, depending on the timeframe and the size and configuration of the pattern I am trading. I always adjust my position size so that in each case the amount of pips from the entry point to the stop loss represents my maximum trade risk (as a fixed % of my trading capital). As a consequence the position sizes I use vary from trade to trade but my risk does not. So, for any winning trade, how much profit I make per pip is proportional to the distance between entry point and stop loss. The placement of a stop loss also influences both the win rate and reward / risk ratio and therefore the expectancy. So its placement is absolutely key. When I am in a winning trade, I roll the stop loss in the profitable direction to lock in part of the profit, thus ensuring the winning trade does not turn into a loser. The stop loss has now become a profit protection point and the trade has become a management of profit. As a rule, I must have hit my first profit target, before I can do this manual trailing. These risk free trades, essentially trading with the markets money, are awesome. Rolling the stops in the opposite direction is a no-go: stops can only be tightened, never widened . I can´t talk about stop losses without mentioning "stop loss hunting” . This refers to situations when the market quickly spikes and hits your stop loss so you are out with a loss, only to reverse and continue in the direction you predicted. I will not get into whether it’s the broker, the banks or institutional traders that are behind this (looking for liquidity to fill their positions), but this price behaviour does happen and taking it into account pays off.
Education
by JazzForex
66
USDJPY before NFP 6 March 2015Everyone waiting for NFP? Yes USDJPY now forming 3 drive pattern, likely will fall down to nearest support at round number 119.400 something. But we need to be very careful making decision here because this pair currently will bounce a bit high before drop down with NFP (bad data forecast). Maybe there will be some spike to the 120.500 level to test the critical level there tonight before the free falling. CAUTION, very wise money management needed here as we still can't see clearly the direction of this pair. Make sure you put a ideal stoploss and use your money management to control this unclearly situation. Mostly because everyone wait for NFP. Happy Trading and NFPing !
Short
by expertradersfx
Expectancy Revisited: Improving your ProfitabilityTEST YOUR TRADING SYSTEM I will not go deep into this, because it quickly becomes a shouting match on who has the best system, which is usually more about ego than fact. It is sufficient to say that I have seen / know of profitable traders who use fundamentals, price patterns, Elliot waves, renko, moving averages, structure levels, pitchforks, trend rules and custom indicators. I will not get into which system is the best, because I have not back tested them all personally. This does not imply that it does not matter what system you use. Far from it. You need a system that gives you an edge. And the only way to know if it does, is to back test it against a relevant amount of data. ADD FILTERS Adding filters to your strategy aims at improving your win rate by eliminating losers. It’s a way to get the odds on your side over a larger number of trades. Examples of filters you could add are: trade with the daily trend, trade with the fundamental direction, filter out unprofitable patterns, don’t trade during news events, only trade reversal patterns that complete at a key structure level, only trade breakouts after a retest of the trend line, add an extra indicator (e.g. stoch or sma line crossover or rsi divergence) or use a particular candlestick as a final entry signal. There might be a price to pay: if a particular filter delays your entry point, it can improve your win rate while reducing your reward – risk. INCREASE THE OPPORTUNITY FACTOR The opportunity factor relates to how many trades your method allows you to take per day / week / month. If by adding filters you are left with just a few possible trades a week, your win rate can go up, but your overall profit might suffer because there would be fewer trade candidates passing through to your filters. This will leave you with fewer trades to contribute to your overall profitability. You can increase this factor by adding more currency pairs to your portfolio or by adding trading hours to your schedule. When adding pairs, be aware of the correlation to the ones already in your portfolio. IMPROVE YOUR TRADE MANAGEMENT RULES Trade management relates to profiting from the trades you decide to enter. It aims at maximising your average winner while minimizing your average loser. The key is having rules that let winners run and exit losing trades without hesitation. Aim for realistic profit targets by reviewing the profit logic of your trades. Predefine a risk that you accept and don’t exceed. One of the ways you can do this, is by managing your trades in a multi-position manner, aiming for several profit targets. Take profit at various stages, as the market makes it available to you and roll your stop loss to break even or a profit protection point as the trade progresses. DISCILPLINE AND CONSISTENCY Once you have the right system, rules and filters in place, you just need to trade your plan consistently day in and day out. Monitor your susceptibility for making errors and eliminate them one by one. Relaxed, concentrated and mindful like a Zen Monk. Don’t overtrade by chasing entries. Don’t under-trade by arbitrarily skipping valid opportunities. Be organized and prepared. A random, inconsistent approach to trading leads to random, inconsistent results that will never be optimal. So plan your trade and trade your plan. TYING IT ALL TOGETHER Simply put, your expectancy per month is the opportunity factor multiplied by both the win rate and the average winner less the opportunity factor multiplied by both the lose rate and the average loser. For the example from my prior topic (see the link under Related Ideas), we know that the calculation was as follows: expectancy per month = 90 x 55% x €120,00 – 90 x 45% x €80,00 = €2.700,00. I have tried to give some tips and trick on how to influence each of the variables in this calculation with the aim to arrive at an improved mix, leading to an improved profitability.
Education
by JazzForex
21
Expectancy: How Profitable is your Trading Strategy?As we all know, when we open a trade, there is no guarantee it will be a winner. Given the win rate of a certain trading strategy, there is a random distribution between wins and losses. We trade to make money over a larger number of trades, not to win every individual trade, which would simply be unrealistic. That is why it’s important to be confident when we place a trade. So we don’t “panic close” the trade when the market goes against us, or exit too soon when we are in profit. If you know the expectancy of your trading strategy, you will be able to deal with these situations better. There is a psychological aspect here: knowing the predictable profitability of a larger number of trades you undertake will build your confidence, which in turn reduces your tendency to shortcut winners and to let losers run too long. Having this confidence will thereby improve your overall results. In December I developed a spreadsheet for myself, linked to my trading records, where I calculate several performance indicators, among which expectancy. How to determine the expectancy of your trading system? Assuming you keep records of your trades, you should go back and look at all your trades that were profitable versus all your losing trades. Do this over a period of at least 3 months and at least 100 trades. The more data you can use, the more accurate the result. We only need 4 pieces of information: number of winning trades, number of losing trades, amount of money won and amount of money lost. From this data we can calculate the following: Net profit = amount of money won - amount of money lost Win rate = number of winning trades / total number of trades Lose rate = 1 - win rate Average winner = amount of money won / total number of winners Average loser = amount of money lost / total number of losers Average reward / risk = average winner / average loser Expectancy per trade = win rate x average winner – lose rate x average loser Or, alternatively, expectancy per trade = net profit / total # trades Expectancy per month (profit forecast) = expectancy per trade x average # trades per month Expectancy per amount of money risked = win rate x (average reward / risk + 1) – 1 Or, alternatively, expectancy per amount of money risked = net profit / average loser / total # trades I will illustrate this with an example for a euro account. Lets assume we have been trading for 6 months and made a total of 540 trades. 297 of them were profitable and 243 were not, with €35.640,00 profit coming from the winning trades and €19.440,00 loss stemming from the losing trades. Lets make the calculations: Net profit = €35.640,00 - €19.440,00 = €16.200,00 Win rate = 297 / 540 = 55% Lose rate = 1 - 55% = 45% Average winner = €35.640,00 / 297 = €120,00 Average loser = €19.440,00 / 243 = €80,00 Average reward / risk = €120,00 / €80,00 = 1,5 Expectancy per trade = 55% x €120,00 – 45% x €80,00 = €30,00 Or, alternatively, expectancy per trade = €16.200,00 / 540 = €30,00 In our example the expectancy per trade is €30,00. This means, on average (over many trades), each trade will contribute €30,00 to the overall P&L. Expectancy per month = €30,00 x 540 / 6 = €2.700,00 In our example we can forecast a monthly profit of €2.700,00 based on prior performance. Expectancy per € risked = 55% x (1,5 + 1) – 1 = 38% Or, alternatively, expectancy per € risked = €16.200,00 / €80,00 / 540 = 0,38 In our example the expectancy of the trading strategy is 38%. That means the trading strategy will eventually (over many trades) return 38 eurocents for each euro risked. Once you know your expectancy, as a function of your own trading statistics, you can forecast how much you could make per week, per month and per year.
Education
by JazzForex
35