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How To Backtest Further In The Past On Low TimeframesQuick video to show this little trick using the Replay mode that allows us to load more historical bars than real time, and thus get a better picture at how a strategy can perform over time. The Strategy Tester re-calculate the results everytime we load new bars, as the indicator strategy is correctly applied to these new bars. I got the confirmation from the awesome TradingView Support Team that the extra data that you get this way is real and relevant, and can be used to test your strategies. That means we are no more limited to 15/30 days backtest data in the 5min timeframe for example.
BITMEX:ETHUSD.PEducation
by cyatophilum
55
How I trade BA This video covers my BA trading strategy. I get many requests on what my trading style looks like (as a quant trader), so I figured I would show how I trade BA, as this particular strategy is replicable and the tools I use are publicly available (linked below). NOTE: This isn't financial advice. As well, my signal to long BA is always a Z Score of -2.6. However, my signal to short BA changes based on the market sentiment. Currently, it is -1, however for the most part of 2021 and up until last month it was set at -0.5 to 0. In general, I DO NOT recommend shorting a stock with a Z-Score of -1. It is high risk. Its important when you are applying any strategy to back-test it first! As well, this strategy is applicable to other stocks; however, its important to get a feel for how the Z-Score behaves as each stock is unique. For example, TSLA I have seen go as low as a -4 Z Score and as high as a +4.4 Z Score. The parameters I share in this video are my current parameters for BA but are subject to change as the sentiment changes. Let me know your questions/comments and criticisms below! Thanks for watching
NYSE:BAEducation
by Steversteves
2
What Does Consistency Mean In Trading ? Hello traders: Today let's talk about “consistency” in trading. Many traders understand they need to be consistent, but what exactly is consistent in trading ? To me, it's not just making consistent “profit”, rather it's being consistent with your trading strategy, risk management, trading psychology, mindset and emotion. Let's take a look at a few examples of consistency in trading: Consistency in profits: More often traders think about hitting a set amount of % return in consistency. This is certainly one way to look at it, but I would say to challenge ourselves to do more. Each and every month, the market will develop differently, hence our profits are not gonna always be the “same” each and every month. Some month with more profits, some month with more losses. We need to have the ability to stay “consistent” no matter what the market condition is. Consistency in strategy and Trading Plan: Remember, there are many different trading strategies out there. The ability to stay “consistent” with your current trading strategy, and not jump from strategy to strategy. Even if your strategy right now isn't getting any entries available in the current market condition, while others are entering trade, you need to stay consistent with your strategy and let the probability play out. Understand no strategy can catch every move in the market. Some will catch this particular run, while others will catch other developments. Consistency in risk management: When you are at a series of drawdowns and losses, the ability to stay “consistent” with your risk management. Not risking more than 1%, not entering more than 2-3 trades at a time. No revenge trade, and/or over leverage trade. Respect your SL and honour the SL. More often traders fall into this stage while they take a number of losses and throw their risk management out the window. Consistency in mindset and emotion: When your strategy isn't playing out on a short term, the ability to stay “consistent” and not to start randomly taking trades based on FOMO, Greed and emotion. Sometimes traders get impatient and feel like waiting for setups to happen is a hassle and they don't want to wait. This is when they start to rush their trading journey and backfires on them. Consistency in your goal: Set goals for your result and progress. The ability to stay “consistent” with yourself and don't let external factors like social media, fake guru, scammers affect you and your goal. If you plan to have 5% per month profit, then don't let other people affect you in a negative way. Everyone trades differently, and with different strategy, method and approach. No need to compare and compete with others, rather, with yourself each and every year. Below I will forward some good educational videos on the above topics that we have discussed: Trading Psychology: Revenge Trading Trading Psychology: Fear Of Missing Out Trading Psychology: Over Leveraged Trading Risk Management: Combine everything you learn to prevent blowing a trading account
Education
by jojofang0901
17
The myth of risk management - Hack it :) I speak to a lot of traders, new and veteran. It's surprising to see how so many are not sure how risk is calculated and what the exposure really means in terms of P&L. This obviously is a major block in the road on the way to gaining confidence necessary to avoid losses. So let's break it down - *P&L is calculated by lot size * movement. Example: If you have 100 ounces of Gold (1 lot) - That's $100 in P&L (Profit/loss) for each $1 Gold moves in value, so if the price 1890 and you are buying 1 lot , price moves by $5 higher - That's a $500 profit ($100*$) , same thing in reverse, if it would drop by $5 that's a negative of -$500 in open P&L. Leverage decides what you are technically able to open in terms of margin used. So if your leverage on Gold is 1:100 - The value of a 1 lot trade is the price of Gold multiplied by the amount of ounces , so let's say 1890*100 = $189,000 value trade, but your leverage is 1:100, so you would only need $1,890 of used margin (189,000:100) to open the trade. But if you have 1:20 as leverage, you would need 5 times more used margin to open the trade. So a common misconception is that your risk is your leverage. That's not true. Your risk is your lot size. But if you have very high leverage , than you can open very high lot size with a small account - Which is extremely dangerous and not advised. So what does an experienced , smart trader do? No matter what his leverage is, he understands the short-term and the long-term range of movement, and opens a lot size that fits the size of his account considering the range of movement. If the account size is $100,000 , and you are buying 1 lot of Gold: The weekly range is 1840-2,000 , the short-term range is 1880-1910 - Price is 1890 So the exposure is ~$1,000 in the short-term (1%) back to the short-term support 1880 , compared to $2,000 on the short-term resistance (2%) of 1910. The long-term exposure is to 1840, meaning a $5,000 exposure 5% ($100*$50) from 1890 - but 2,000 is the top of the weekly range, meaning - $110 up ($110*100) = $11,000 (11%). So didn't really matter what the leverage is 1:20 or 1:100, what matters here is the range and the lot size. Thank you for reading! ----------------------------------------------------------------------------------------------------------------------------------- If you liked my educational idea please like and follow! It would mean the world to me! I promise to answer all comments/questions - I encourage you to communicate :) Thank you so much for reading - Looking forward to reaching as many of you guys as I can :D -----------------------------------------------------------------------------------------------------------------------------------
BITSTAMP:BTCUSDEducation
by Exactus
Why do traders mostly lose? Point of viewFor 3-5 minutes while going through this forget what you know about trading. First thing is : Let's remember our goal, every successful action/plan started with a clear goal that led the way: In our case it's profit When starting to trade seeing the numbers go up and down plays with your head and emotion quickly tempting you with the unlimited potential at your fingertips. Even experienced traders that had some lucky streaks forget that the wanted end result is simple - to be in the money, meaning, making profits consistently. In order to secure our goal of making profit we need to first start with remembering this is not a 'get rich quick' scheme and there is no magic - A big bunch of money won't fall on your head out of nowhere, at least not consistently. Now - remember this : It's a lot better to be consistently profitable than to have a series of a few winning streaks . With this in mind, it's great if you would put up a sticky note on your screen reminding this - As at times it gets hard keeping sight when numbers run wild. I see many traders look at between 5-10 crypto currencies, 3 commodities and 10 currency pairs - Deciding based on a variety of different things what to trade on every time. This way of action has no structure at all - Which makes it very hard to reach a certain target: profit. It is necessary to have focus, structure and a plan with a single minded mission: PROFIT. But not just any profit - smart profit, a profit that was a result of planned action. So how do you make a plan? The easiest way to effectively craft a well thought out plan is to focus on between 2 to max 3 instruments Learning the range, price action and tendencies of 2-3 instruments can be done within a few weeks going through 1h, 4h and weekly time-frames and determining the short-term and long-term projections of each of the 2-3 instruments. Once you start seeing the patterns and understanding the price action continue by implementing what you learned on the instruments on a demo account testing a possible strategy that relies on clear idea of what to do with every possible scenario. You may not get it right with the first strategy, so try others until you find one that shows consistent results - while mastering the 2-3 instruments you have chosen and continuing to following up on a daily basis on relevant news, changes in trends on short-term and long-term projections. For me - Because I've dedicated years trading and following Gold and WTI , learning how and why it moves - I prefer trading a swing trading strategy, keeping trades open between 3 days to 2 weeks usually, this puts my bigger picture understanding of the instruments into true effect The difficulties you will find while searching for your strategy are - *Greed *Fear *Lack of patience *Lack of discipline in plan Don't let them in - Remember your plan and one and only goal : consistent profit! Thank you for reading, Let me know what you think and what you would like to hear more about :D
BITSTAMP:BTCUSDEducation
by Exactus
3
The basics of back-testing (HOW TO)Hey Traders, Today I wanted to follow on from the fantastic amount of comments that we are receiving from the previous video, "stop strategy jumping." It seems that so many of you took a whole heap of value from that video and for that I am very thankful and to everyone who reached out and told their story or let me know that it really touched them. As highly requested, I wanted to run through a basic way to start getting the grips with strategy back-testing. How can we go about back-testing our strategies to ensure that they are profitable for us in the long run? Take a look, have a listen and tune in. Set up an excel sheet the way I do and get back testing. There's only one way to do this, and it is to do the hard work. Let me know what you guys find. I can go more in depth in the future, but for now. It seems like most people wanted to get to grips with the absolute basics, which is what I'm going to show you today. If you have any questions at all, please the comment section is the place to be. As always, have a fantastic trading week and a fantastic weekend traders. I'll see you very soon.
Education
by the5erstrading
12
The PIK Trading Strategy & Key Lessons for Day Traders!Hey Traders! Happy Sunday! In this video, which ends a little earlier as I didn't know videos have a limit, we go over a few key points, starting from the PIK trading strategy which you guys will hear about much more over the next few days, mindset, motivation and guidance is covered too! When it comes to the PIK trading strategy, we go over the indicators that are used, price action and key levels! The video isn't our best one, but it does have plenty of value and we hope you enjoy it! Thanks and all the best!
OANDA:DE30EUREducation
by PrimedGroup
How to use Inside bar strategyInside bar strategy is one of my personal favourites, in this section I will detail how and why I trade Inside bars to deliver more profits during a trading week. Now In my personal opinion any non profitable trader should be chomping at the bit to learn this strategy as it has the potential to really aid your trading journey. So lets breakdown what finding an Inside bar means... So above me here is the recent rally from the pair GBP/JPY , I have highlighted a few of the inside bars but if you look close enough you will see more, So an Inside bar on the daily is telling us the day before we had a strong rally this can be called candle (1), so Candle 1 is a rally, Candle 2 is inside the range of candle 1, what this means is that on lower timeframes we have seen consolidation, Price hasnt broken the high of candle 1 or the low of candle 1, so when candle 3 breaks the high of candles 1 and 2, price rallies to our target. So the entry comes after the high of candle 1 and 2 broken, you use a stop loss under the low of candle 2, and you aim for 1:1 risk reward. When is the best time to trade these candles? In strong rallies you will see this set up form alot , the reason for this is because in strong rallies, we often see rally-consolidation-rally. Typically this strategy will win around 70% of its trades and is great for entering rallying or depreciating currencies, I hope you guys can put it to use like I have over the years! any questions please feel free too comment below (This is not trading analysis this is purely to demonstrate how inside bar works and how you can use it in your trading). Enjoy the weekend!
Education
by ZenFlo
LET'S GET REAL: Stop Strategy Jumping!Hey Traders, This one is going to be a little bit different, a little bit deeper and a little bit harder to listen to rather than usual technical analysis. I recommend you sit down and listen to this. Have a think whether it relates to you or whether you found yourself in this position, or even if you've gone through this position and share your experience on how you go through it. A lot of traders struggle with their strategy, jumping from aspects of trading and that's why so many educators out there make a lot of money off of them. It is time to stop. In this video I outlay a challenge that I put to all the traders who may find themselves in this position to sit down and to thoroughly test their current or previous strategies and understand them on a deeper level. No more jumping around, no more looking outwards. Let's start looking inwards. Let's see the data that we have handed to us and what we can do to improve that data. If you enjoyed this video, please leave a comment. Leave a like, if we do get enough likes and comments, I will make a Part 2 on how to go about this with a more depth avenue while using different resources. As always, have a fantastic training week.
Education
by the5erstrading
222
HOW-TO: Accumulation StrategyIn this idea I will make an in-depth tutorial on how to use the Accumulation Strategy and how to automate it. █ PRESENTATION The strategy is in the form of an invite-only script providing backtesting and alerts. Here is a link to the script page: Goals  • Steady profits. Smalls profits over time and no drawdown as long as you don't sell in loss.  • Peace of mind. It is meant to be a "set it up once and let it run for a while" automated strategy.  • No loss. Never sell in loss. Drawbacks  • Small profits. No leverage, just spot trading.  • Lengthy trades. Trades can take up to several days or even weeks in worst case scenario. We will see how to avoid that. Strategy  • Use volatility. Take advantage of small waves in the market.  • Buy the dips. Use a combination of technical indicators to buy bottoms or oversold prices.  • Accumulation. Buy small amounts several times as price moves to better position yourself.  • Take profit from total volume. Sell everything once price is in profit at the configured percentage value. █ BACKTESTING Backtesting is the process of creating a strategy. Finding a good pair  • By Market Cap. Take a category you are comfortable with (DeFi, Metaverse, DAO, etc) then look at coins in the top 10 market cap.  • Volatility. The more volatile the coin is, the better.  • Ascending/Sideways trend. This is where the strategy will work the best. We will see just below how to filter off bear markets.  • Pick a timeframe. Usually from 5m to 30m, can be higher or lower. I look at the average bar, I like something around 0.5-1% bar height, the chart should not have too much noise, otherwise go higher timeframe. Though not too high, since we want to take advantage of the volatility. Build your entries You first have to create "entries" that will then end up being a buy signal, after passing through some optional filters.  • Entry settings    • Go Long/Go Short     The indicator allows to trade both sides of the market. In these examples, I will only go long-only for simplicity.    • Max active deals     This is the maximum consecutive buy signals allowed for the strategy. Example with 10: the strategy will buy up to 10 times until take profit is hit.    • Minimum bar delay between deals     Puts a minimum delay between each entry signal, in bars.    • Minimum price difference in % between deals     Sets a minimum price percentage between each entry signal. Leave at 0 to disable.  • STOCH & RSI entries   Creates entries when the RSI or STOCH crosses below a configurable value. The length and resolution of the oscillators are configurable.  • Other entries   Signals using some of my other custom indicators are BUILT-IN:    • Top & Bottoms    • Higher lows, Lower lows    • RSI Divergences Entries are combined using a OR logical gate. I usually go with RSI and STOCH entries on higher timeframe using the resolution input, then add Top & Bottoms or Higher lows if I feel like it needs more entries. Once you have chosen a combination of entries, let's move on to the filters.  • Trend Filter   You can pick a trendline from a list, usually a simple EMA 200 will do the trick. Using slope change or price cross, it will filter off entries if the market wave is bearish, thus avoiding taking risky trades.  • MTF Trend Filter   The same thing, but higher timeframe. It is used to filter with the market wave, meaning the more global trend. It is a good habit to combine the 2 trend lines to drastically reduce the risk. The Adaptive Tilson T3 is one of my favorites, combined with the CROSSOVER condition.  • RSI filter   Useful with entries other than RSI to filter overbought entries. Use a higher timeframe to filter more aggressively. I would advice to use all 3 filters if you can. It will prevent getting into lengthy trades as we will see below. Adjusting  • Backtest parameters   First you should go to the backtest parameters tab. Here is what is used in this example:    • Initial capital: 1000 €    • Order size: 100 € (the max deals is 10 here, total deals should not exceed initial capital)    • Pyramiding: 10 (the number of max deals)    • Commission: 0.075 % (Binance spot trading)  • Take Profit    Configure the take profit, in price %. I usually go with something from 1 to 4 %. In some cases, activating the trailing TP can be interesting.  • Backtest results   In addition to the strategy tester, the indicator has a backtest panel containing useful information. Here are some of it:    • Net Profit (% and fixed)     Useful to see how volatile a pair is compared to others.    • Avg # Bars in a deal     Average number of bars a trade can take to be completed. < 100 - great, > 100 - can be improved, > 200 - bad    • Avg # Days in a deal     Same information but in days.    • Max # days in a deal     Maximum number of days a trade took to be completed. < 30 - great, > 30 - can be improved, > 60 - bad Example of settings that can be improved: The Avg # bars and Max # Days in a deal are flashing red and orange. It means it can be improved. By adding the 3 filters, increasing the stoch entries timeframe and reducing the take profit to 3%, we are getting a much more secure strategy: All the settings are in green, we know that over 421 days, the maximum days a trade took is 13.78, and a trade takes 1 day in average. █ AUTOMATION When you subscribe on my website, you unlock access to the indicators but also an automation system for Binance. The system is using the indicator alerts to automatically place orders on Binance using their SPOT Trading API. You can find a tutorial here . Create a bot The first step is to create a bot for your strategy. Make sure you have enough capital in your account for the strategy. Set the order size/quantity with the same value as in the indicator backtest parameters. Create the alert I recommend to create one chart layout per strategy. Once you are done setting up the indicator, set the alert messages. You will find the text fields at the bottom of the indicator input settings. You will typically need to fill "Long Entry" with the buy message, and "Long Take Profit" with the sell message. Once you have done that, save your chart. Click add alert on the indicator. Select the condition "Alert() function calls only". Tick "Webhook URL" and set the URL. It can be the one from my bot system or if you use another bot system with webhooks it will work too. Give your alert a name and click create. Make sure the alert is created in the alert tab. The alert will save the indicator, settings and timeframe at the moment you create it. If you decide to change an indicator setting, you must remake the alert. Fees If you trade on Binance, I recommend to enable BNB Spot trading fees, and always have a few BNB on your account to pay for the fees. That way, you can use a sell 100% quantity order without needing to take fees into account, unless you are using the strategy to trade BNB. In this case, use something like sell 99% in your sell message. Supervise Once your strategy is running, you can supervise it in the strategy tester in real time, in the alert logs and in the bot logs. ═════════════════════════════════════════════════════════════════════════ █ SCRIPT ACCESS Indicator and automation tools access can be purchased on my website. The link is in my signature below. █ SAMPLE USE CASES I will update this HOW-TO idea whenever I backtest a new pair, sharing the configuration and a link to a shared chart that you can copy and edit yourself. Example on MANA/USDT: Link to the chart: www.tradingview.com Thanks for reading. More to come below.
Education
by cyatophilum
2
How To : Chart Formations Critical Second Top & Bottom Entry Hi Traders and Investors This video is a follow up from my previous posting dealing with shifts of momentum. This time we are looking to add an additional synergy - the second touch in a chart formation - which can be found in Double Tops, Double Bottoms and head shoulder formations. Correctly using the second touch on the chart formations has allowed me to avoid many mistakes in my evaluating my trades and I hope that it will help you in evaluating your trades. When you look at the Double Top and Double Bottom chart formations, you will notice that high frequency trading and algorithms trading will often create the formation of a second top to the same level as the first top or slightly higher by taking stops pilling at the first top . At this point, you want to wait for the synergies to come into play and use your tools to look for a shift in momentum on the 2nd top touch see video. Waiting for the shift in momentum to occurs after the second touch, is a critical piece of of information that will prevent you from taking trades that are likely to be stopped out on the first test. Hope it helps have a great week end Marc
CME_MINI:ES1!Education
by PowerIndicators
9
Moving Average Cross Over StrategyWe start by creating a visual for when all moving averages are in order and across the 200 moving average . In this example, I have used a vertical line in the colour of our bias direction, Long(Green) , when this condition has been met. We now have an increased confidence by filtering out trade setups that do not meet our bias giving a higher probability and focus. Levels of previous resistance give us a price that we can enter the market by turning into a new level of support . In this example I have highlighted this with a red arrow located on the left hand side. Now we have a trading bias and a methodology to set price restrictions to enter the market, we can now trade only long positions and trade setups . In this example I have highlighted long opportunities that have been triggered with arrows in green located on the right hand side. Entry points can be executed on either the daily , 4hour or 1hour charts depending on risk and trading style preference. Please note - Lower time frames may generate more signals which presents more risk.
Education
by Youza
MY FIB SPEED RESISTANCE FAN TRADING STRAT : ) Hi! I'm xtekky and this is my tutorial on how to use the Fibonacci speed retracement tool- I used Apple (AAPL) as an example to display the tutorial. Steps: (1) Open the fib retracement section on the left bar and select the " Fib Speed Retracement Fan" (2) According to your trading style, select the timeframe I indicated in the chart - to begin with - you can then choose the timeframe you are most comfortable with. (2) Define the begin of an uptrend (after last retracement or reversal) and place your first point (3) Define the end of the uptrend (after last retracement or reversal) and place your second point - if there isn't any recent retracements / reversals, you can take previous ones or the highest recent value (4) Define the most relevant percentage (38.2% on this chart) but it may as well be another level - note that fib levels 38.2% and 61.8% are often the most relevant ones (5) Let the stock / crypto test the level once or twice to make sure it holds, you can of course jump in directly if you are confident. (6) Take Longs and Shorts in the "Channel" Advanced: (7) Use momentum reversals (Squeeze Momentum from @LazyBear is the best indicator for me) to define more precisely when to jump in - note that the price doesn't always trade in the channel, there are some false breakouts and/or the price sometimes reverses a bit further. (8) Use volume support / resistance zones (9) Include Imbalances in the prices (If the Crypto/Stock you trade has a high volatility/manipulation rate) If you want more complex tutorial, you can see a more detailed vid on the Ytb profile linked to this Tradingview account Disclaimers: !! This is not an investment advice and you shouldn't use this technique alone !! !! Never invest/trade with more money than you can afford to loose !! ------------------------------------------------------------------------------------------------------------------------------------------------------------ That's pretty much it! don't forget to ask or DM if you have any questions! If you want to follow me on this long journey ahead of us, you can support me by subbing and liking the post ! -Credits to xtekky-
NASDAQ:AAPLEducation
by xtekky
1
Simple BUT Not EasyReading charts and understanding the "Language" of the market is very simple but at times due to high involvement of our emotions we make it very hard. Any market or chart that you see will be in a phase all you have to do is identify it on a higher time frame. Lower Lows & Lowers Highs is a definition of a down trend. Higher Highs & Higher Lows is a definition of a up trend. If you can see the above both happening then market is ranging. If you are having a short bias on a particular instrument always look for a shorting opportunities in a lower time frame after confirming the phase of the market in a higher time frame. Always wait for a confirmed trend don't try and jump in too early. Let market decide the direction, don't force your self. Risk Management is very important, Plan your trade with a proper risk that you can manage. Trading is a marathon, if you try to sprint you will fall down and injure yourself. Slow & steady wins the game :) Thanks
TADAWUL:TASIEducation
by stalkstock
⭐ HOPE AND FAITH💥 Am I the only who at some point while trading hoped for price to move in my direction or bias or rather open a position with mere hope and faith ❓... Certainly not. At one point or the other you must have done this and possibly still struggling with it. 💥Truth is, the market will always do whatever it wants regardless of your strong hold, hope or faith in your bias. What then do I do ❓ 1. Take trades that you've planned. Do not just wake up, get into the market and start executing trades without proper analysis. Take trades with predetermined entry, stop-loss and take profit level. 2. Be quick to admit that you're wrong when the market chooses to go against your bias. Stop adjusting your stop-loss when in a losing position. It will enable you cut the losses early. 3. Avoid trading based on emotions. It is easier said than done. But with practice you will get better at it. Be logical and see things as they are. 🔥 I HOPE this helps. Sage Trader's Nugget
Education
by Sage_Trader
HOW-TO: A Step-By-Step Guide to Using The Profit Maxima StrategyThis strategy is suitable for position traders who hold their positions for months. The goal is to determine the best entry and exit levels in order to achieve maximum profit with minimum risk. Due to the bullish nature of the crypto market, trading in the “short” direction is avoided. Step 1: Choose the best chart Use the "Chart Quality" table to choose the appropriate chart. The "Historical Bars" field displays the total number of candles in the chart. The more historical price data is available, the more accurate the results will be; so choose the chart of an exchange that has the most historical bars. The "Predictability" field indicates how reliable the results are. The "Recommended Chart" field shows the suggested chart for some common symbols. Step 2: Place your orders manually Set your entry and exit orders at three different levels; for this, use the "Entry & Profit Limits" table. As you can see, the Entry and Target levels are matched in pair. Step 3: Be patient As mentioned, this is a long-term strategy. In the long term, there are fluctuations, price corrections and so on. So remember that patience is the key.
Education
by BobRivera990
1
A brief explanation on the importance of risk managementEvery human activity has its ups and downs. You may face good days and bad days and it’s a norm in any other human kind activities. Read history! Did all dynasties get consistently stronger? In politics, did popularity rates of political figures get better day by day? Sure not! Even in natural events, you see uneven decreases and increases. Not only the annual rainfall rates are not always the same, but the rate of increases and decreases varies from year to year. So strategies and setups won’t always work because they simply are man-made things to predict a human-based activity! They may fail, expire or disused someday, because this is the neutrality of nature and creatures including humans and their markets. For the last instance, even stars grow and fall. I know there are some traders who claim their strategy will never expire. They may be liars, but they are not necessarily liars! Those who believe their strategy will never expire will admit that their strategy had bad days too. I like to say their strategy has expired and reactivated again and since they consider longer cycles (monthly, yearly or even bigger) they believe their setup has never expired. If we want to be more precise their strategy has expired but just for shorter periods (may be just for hours!). Let me explain a little more technical, every setup is compatible with specific conditions of the market and they will fail in other markets’ conditions and traders are not foreteller but predictors, so they sometimes may get conditions have changed and sometimes they predict it wrong or get the change so late! So they sometimes make profit and sometimes don’t. For example RSI overbought and oversold strategy do not make profit in trending market on the side of the trend! I mean if markets are bullish, overbought is a norm not a sign of reversal (most peak of reversals happens in overbought or oversold but not every oversold is a sign of reversal in a trending market) and in a super bullish trending market you almost can’t find any RSI oversold. So you should use another setup! ( some traders using kind of strategy which has different setups for different conditions of market, they actually guess when their strategy is going to expire) I divide the professional traders by methods that they choose to avoid using an unsuitable for market conditions into four general categories. 1- Ignorers: Since they got a conservative risk management strategy and they could easily ignore expiration phenomena and trade without worrying about expiration. 2- Rule makers: They have different setups for different conditions. They specify some rules to distinguish market conditions and adapt new setups to their trades. Rules could be created by using both indicators or indicator-free (price action) chars. 3- Sentimental Market traders (in case of expiration): Some traders do not use specific rules! They simply just sense market conditions has changed. They differ from rule makers because they don’t use a specific rules every time. They may use some rules unconsciously but those rules may differ time to time. 4- Equity curve analyzers. They simply analyze equity curve! They make specific rules to start using or stop using a strategy! For example they will stop using it if it is a loss-maker one for 2 weeks (this one won’t work in most strategies) or they simply try to use price action rules to analyze EC of a setup! “Mark Douglas (1990) is saying that if traders were to chart their equity, these charts would look very much like the typical bar charts and charts like these also can have the same predictive value as in the markets” “Procedia Economics and Finance 32 ( 2015 ) 50 – 55” these kind of traders may use indicators like SMA or WMA to predict profitability of a setup in future and they are also eager to use price action rules. I believe no method is superior to another, the way an experienced trader use the method is important! But having a method to avoid large losses is necessary. And all traders consciously or unconsciously use one of them. Most price action traders are ignorers. Their strategy may expire but for short period of time. For example mine is expired right now but I’ll continue using it cause I know it’s temporarily and I don’t know when exactly it will reactive again. I also use a self-made auto-trading expert which use different indicator based setup and since the period of expirations of that setups are long, I use EC analyzing methods to detect expirations . No matter which method you use, you can’t be an always winner trader! Ignorers may loss and they will name it exceptions. Rule makers’ rules may detect and signal expiration too soon or too late! The 3rd and 4th kind of traders may make mistakes too. There is no single trader in the world with 100% win rate in long-term! That's why you need to limit our risks, I like optimism in life (I prefer pessimism in back-tests) but you should not be deluded, you should think what happen if you lost some consecutive trades? If you risk more than you can handle consecutive losses emotionally, You will empty your trading account, no matter how good a teacher you had or how much you have practiced or how great trading past you have or how experienced you are or even how much you believe your emotions are in control of you (you actually can’t control in real big loses trading), YOU NEED TO LIMIT YOUR RISK by managing it in a way that your trading is profitable enough and simultaneously do not be destructive at certain times "Profit a little less but more consistent." There are also too many other important rules for money and risk management and you should take them into consideration too. Best Regards, Alisignals
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by AliSignals