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Podcast:
In this video:
00:48 Spreading your risk
02:25 A client achieving around 80% accuracy rate
04:33 New Zealand cash rate just announced
05:54 The importance of fundamentals
In today’s video I want to talk about spreading your risk in your trading. Let me tell you more right now.
How to spread your risk when trading Forex
Hi it’s Andrew Mitchem here the Forex Trading Coach. Welcome along, today is Friday the 13th of September. Also special welcome to the four thousand people who listen every single week to my podcast on iTunes so whether you’re watching on video or listening on iTunes, welcome along.
That’s right today I wanted to talk about spreading your risk and what I mean by that is trade on different time frames if you can and also look at different currency pairs. With the time frames, for example this current week I’ve had a losing week on the daily charts, I’ve had some losing trades all up and net loss. Yet overall I’m still up on my trading account this week because I’m also trading on the four hourly charts and the one hourly charts because they’re what suits me. So if you’re able to don’t just rely on one time frame because you’re not going to find that time frame performance well all of the time. Same type of thing with the currencies, don’t just stick to one or two pairs. For me on the daily charts I look through 26 pairs once a day it takes maybe fifteen minutes on the daily charts and that’s it. If I then see strength and weakness within certain currency pairs I then concentrate on those same pairs on the four hourly charts and the one hourly charts for that day so I might be trading some of the major pairs like the EUR/USD, the USD/JPY, USD/CHF etc., and also I might be trading some of the more minor pairs like the EUR/CAD or the AUD/NZD, the CAD/CHF, a lot of sort of more minor pairs as well as the majors. And so what that is doing is it’s not having all my trading correlated to the USD like most of the major pairs are. So it’s two different ways there that you can spread your risk within your trading and it’s what suits you remember.
Trade according to what suits you
I give you another example, I’ve had an email from a client this week who’s been with me for several months now and he said, “Andrew I’m just having some incredible results trading five minute charts.” He’s using one of my continuation patterns that I use and so in other words he’s looking for an uptrend, a pull back and then looking to go long again after a pull back of the uptrend and he stated in an email to me this week that he is achieving around an 80% accuracy rate so 80% win rate on his trades just by following this continuation pattern but he likes to trade five minute charts. They don’t suit me and they may not suit you but if they do, if they suit you, fantastic but equally I can trade that same pattern on an hourly chart or four hourly chart or even daily chart, weekly chart if you want to go longer. So it’s all about what suits you. This particular person just loves looking at charts for about couple of hours a day just on five minute charts, trading with the strongest or weakest pairs, looking for strong trends, looking for pull backs and then heading in the same direction again but an 80% accuracy rate you can’t argue with that, fantastic.
Would you like to speak with one of my clients?
Other news I want to share with you this week, I’ve also had an email from a client in the US who’s extremely happy with my course and he’s been kind enough to offer his email address and his time by phone to anybody who’s genuinely interested in to take my course so it probably applies more if you’re in the US or Canada let’s say but if you’re sitting on the fence you’re not quite sure and you’d like to have the opportunity to talk with someone on the phone then this particular person Robert has kindly offered for me to pass on his phone number and his email address so if that’s you and you’re genuinely interested don’t contact him if you just want to find out some free informat