How to Identify High Probability Trade Setups
In this weekly video:
00:24 – Looking for trades that will work in your favour
01:03 – Most traders rely on an indicator
01:23 – You need to understand how to read the charts
02:12 – Putting multiple factors in your favour
04:05 – Look at the actual price of the currency and use round numbers
05:20 – Adding the daily strength and weakness
05:38 – Client makes +7% in 2 months trading the H4 charts
I'm gonna share with you some tips and ideas about looking for high-probability trade setups. So let's get into that right now.
Hi traders, Andrew Mitchem here, the owner of The Forex Trading Coach, and today is video and podcast number 218.
Looking for trades that will work in your favour
And I'm gonna be discussing with you, and sharing some tips and ideas of helping you to look for higher-probability trade setups. Trade setups that are gonna work in your favour far more often than they're not going to. You see, the problem is with a lot of traders, is they don't have a strategy, and they don't really understand the market.
And when I look around at different systems and different ideas that people tell me they're currently trading … And by the way, they're not making money on, otherwise they wouldn't be coming to me … And what they're doing, it kind of just doesn't add up to me.
Most traders rely on an indicator
Most people are relying on a indicator. They're looking for a line to cross over and another line on their charts. They're looking for a dot to appear on their charts or for a line to change colour, or all these type of things. And that really is not true technical trading.
You need to understand how to read the charts
You see, to understand trading properly, you have to understand the charts and look at the price. You have to understand what's happening in the market right now. And when you clutter your charts with too many lines and graphs and dots and stars, and all these things that people tend to, for whatever reason, think it's a really good idea to clutter their charts with … What you end up doing is not being able to see what's actually happening in the price, and understanding what's happening.
Someone sent me a screenshot the other day and said, “Hey Andrew, can you give me some advice on my strategy.” And I actually couldn't see the candle patterns underneath all this congestion of this big mess of spaghetti and lines and things on the chart. So it was horrible. And no wonder this person was confused, because there was just so much stuff going on.
Putting multiple factors in your favour
And I said to him, “Look. Strip that off, and start again.” And it was something that I discussed on my webinar with my clients last night, and it was all about putting factors in your favour to give yourself a high-probability chance of success. But what is it about this trade setup right now? Even when you understand candle patterns and price analysis, you still need more than just that.
You see, I'm a big believer in candle patternss and candle shapes, and where they occur. But you can't just say every bullish engulfing in candles means that price is gonna reverse and start moving up. You cannot do that. Likewise, if you use … Let's say Bollinger Bands. You can't say every time that the prices hit the upper Bollinger Band, it's now gonna start coming down again. Because it won't. It's like if you use divergence. Every time you see positive divergence, it doesn't mean to say the price is gonna suddenly reverse and start going up again, because it won't. You have to put a combination of different factors together.
And when I was sharing with my clients, just on the webinar last night … I was sharing with clients some of the trades that I've taken, and some that I hadn't taken, but some that I'd seen. Now, with the benefit of hindsight … Because at times I wasn't here, or I was sleeping … But I shared a lot of trades with clients. And when we had five or six different factors all showing at the same time, backing the trade up, all showing the same thing, the same confirmation … On most of those trades, we had outstanding, high reward-to-risk trades that went to their profit target, without hardly getting into any draw down at all.
And it's remarkable how consistent that happened. So it is all about putting those things together. You can't just rely on one indicator. You cannot rely on just one or two things. You have to start to look at the price.
Look at the actual price of the currency and use round numbers
Look at the price number. What is the number of the price right now? Like the level of the price. Just because your indicator paints a little star or dot to say, “Buy here,” you might be buying straight into a strong round number.
And there's some great examples on the charts. If you go and look at your charts, of where the price stalls or reverses, more often than not, it will happen at a round number. Now, what I mean by that is a number ending in zero-zero or five-zero. Now, go and have a look. Just try and … After you finish watching this video, listening to this podcast, just go and do that. Have a look at your charts. Scale down to the shorter time frame charts, like an hour chart or something, and see every time the price gets to a level and then comes back. More than likely, it's gonna be stalling at a round number.
So if you can start to add different factors, and confluence events together with the same technical strategy, and look at the price, and forget most of the indicators and wiggly lines on your charts … Forget most of that. Get back to true price. Where is the price coming to? Where is it bouncing? Why has it bounced at that level in the past? Is there a suitable candle patterns? Are there a few other things I look at and teach?
Adding the daily strength and weakness
Does it have the backup of the daily strength or weakness analysis to … Let's say, a bullish on the daily chart? On the Euro, U.S. dollar, let's say. On a 1 hour chart when I see a bullish pattern, and it's in the same direction as the daily chart, it just adds more and more probability of your charts of success.
Client makes +7% in 2 months trading the H4 charts
Now, I have an email here from a client called Alex. And Alex said, “I've been doing exceptionally well over the past two months, trading only the four at a time frame charts. I have a win-loss ratio of 75%, and my accounts up over 7%.” So that backs up everything I've just said. A high win rate, a higher time frame chart. It's not doing too much trading, not watching the charts all day. A 7% gain on live account in two months, from someone who's relatively new to trading. You could do that, too. If you'd like to know more, drop me an email. [email protected], or leave a comment below this video, and I would be more than happy to help you out.
So once again, this is Andrew Mitchem, The Forex Trading Coach. Have a great weekend. I'll see you this time next week.
How To Become One of The 5-10% of Traders Who Make Money From Trading
In this weekly video:
00:30 – What it takes to become a successful Forex trader
01:12 – Why do so many people lose money from trading?
01.52 – Most don’t have a strategy or the right mindset
03:00 – How I can help you overcome these issues
03:45 – A trading strategy that is proven to work across all market conditions
06:16 – Live webinars for clients every week either in the European or US trading sessions
07:14 – Clients only Forum site to help and learn – building a trading community of like-minded traders
08:54 – Short cut the learning process
I'd like to share with you tips, help, and advice to help you become one of the 5 to 10% of Forex traders who actually makes money from trading, so let's get into that and more right now.
Hello Forex traders. Andrew Mitchem here, the Forex Trading Coach. This is video and podcast number 217.
What it takes to become a successful Forex trader
I want to talk about what it takes to become a successful Forex trader. How I can help you shortcut your learning path and save you lots of time, money, headaches, and frustration. Does that sound good? If so, keep listening. Okay, so there's a common number put around that somewhere between 90 to 95% of all Forex traders lose money.
How accurate that figure is I don't know but wherever you research online, somewhere between 90 to 95% is the figure that's commonly used. So, let's accept that that figure is correct for now.
Why do so many people lose money from trading?
Why is that and more importantly, what can you do to make sure that you're in the 5 to 10% of all Forex traders who make money? Because ultimately that's what you're here for, and it depends how important that is to you, and there's various ways of being a good trader but let me share with you my tips and secrets from around 14 years as a full time Forex trader, and I've seen all sorts of different people and companies come and go in that time believe you me, so I've got a fairly good, extensive knowledge of the Forex industry.
Most don’t have a strategy or the right mindset
Okay, so the problems are most people don't have a strategy. Of course, it's the obvious number one thing. They don't have the mindset of what it takes to become a good trader, they don't have a style that suits them, they don't have back up or help. People very easily get distracted when things don't work out, and you tend to get the … You know the phrase, “Blind leading the blind?” That is a very common problem in the Forex world. People find that when things don't work out for them, and their trades aren't working, they go to try to add something to it. They'll go and search for the next holy grail and the next best system, the next indicator, the next bit of news trading, whatever it might be. They're always on the search for the next thing rather than sticking to what they know.
It's a big danger. When you're out there by yourself trading it's very easy to get distracted and start searching online, so what can I do to help you overcome that?
How I can help you overcome these issues
I'd like to explain why such a massively high proportion of my coaching clients become very, very good Forex traders. In fact, one of them, a guy called Paul over in North Carolina in the US, he's now come onboard with me as part of the team. He's now holding live webinars in the US timeframe, so the US trading sessions. He's that successful I've said, “Look Paul, I'd like to offer you a position as part of the group,” because he's done so well.
There's lots of people out there like Paul who have taken my course and done very well but let's start at the very beginning, and the basics.
A trading strategy that is proven to work across all market conditions
I provide a strategy that's proven. It's as simple as that, it's a proven strategy. It's been proven for years. I've been trading this particular strategy for over 10 of the 14 years I've been trading. I've been teaching it for almost eight years. It's well proven, it's proven, doesn't matter where you live in the world, what timezone you're on, how many hours you can dedicate to trading, what currency pays you like, what timeframes you like, what the market conditions are. It's proven across all of them.
That's the important thing that you need to start with, a strategy that works, a strategy that has logical sense, that works in all market conditions and is proven. That's the first thing. Second thing, I provide daily, like every single day of the trading week, I provide daily analysis for my clients. It includes specific trades that are taken off the daily charts. At the beginning of the week, I also mention weekly charts, at the beginning of the month I also mention monthly charts but every single day I mention trades that I'm placing myself based off the daily charts. The reasons for taking the trade, the candle patterns, the set up, all the reasons why I'm looking at taking that position, it's all done in advance of the market moving.
There's no hindsight involved, it's real time, you can make money from it by just understanding it, copying it, learning from it. The entry positions, the stop loss, the profit target, the reasons why. It's all taught in the course anyway, but every single day I'm writing this information for my clients to train their eye in real time, so that one, they can learn from it, two, they can earn from it, and three, they can then go and apply that same philosophy, same principle that they're seeing day after day after day, and apply that same strategy and principle to any other timeframe chart that they wish to trade. It's a real time trading. It's not, “Oh, yesterday I might have done this,” or, “Yesterday I did that,” and hand picking good trades. It's not that at all.
You get the good trades, the bad trades, everything in real time. It can be applied, doesn't matter where you live in the world, to apply that onto your account. You have the strategy, the daily trades, strength and weakness analysis, where I'm looking for strength and weakness with different currencies as well. Now, part of that's freely available on my website, but the clients actually get so much more. Only clients get the specific trades.
Live webinars for clients every week either in the European or US trading sessions
Live webinars, just mentioned, I've just taken onboard Paul who is now going to be holding two webinars per month, one and a half to two hour live sessions per month in the US trading session.
First one was just yesterday, and the alternate weeks, every two weeks, I hold and have done for eight years, live trading room sessions which are all two to two and a half hours long in the European session. They all get recorded if as a client you can't get there to watch it live, but these are real time trading webinars. Clients only, so everybody understands the system, the strategy, when they're on there. We're looking at taking trades in real time, we answer questions, we look at trades that were taken over the previous week since the last webinar, lots and lots of real time information. When we're looking at historical trades, we show trades that have worked, trades that haven't worked because you can learn from both.
Clients only Forum site to help and learn – building a trading community of like-minded traders
I have a forum site that's for clients only. It's not one of those silly arguing, everybody's trying to outdo each other forums like most of the forums out there in the general Forex world. It's clients only, talking only about the strategy that I trade and teach. Different timeframe charts, where I discuss, people are posting trades in real time. Some people post trades that they've taken, good and bad, in hindsight, after the trade's closed. But a lot of people on there posting trades in real time saying, “Hey, I'm liking the look of this set up and these are the reasons why,” but again, it's building a community.
There's hundreds and hundreds … Well, actually there's thousands of clients that have taken the course, but there's hundreds of clients on the forum sites all the time, interacting with each other. There's always information there to gain. You put all that together and you add to that trading software that helps identify set ups, it's not a robot system, it's not to say you have to rely on that software, but the software identifies key levels of support and resistance, helps identify candle patterns, different things like that that are included in the overall strategy. It just helps alert you to potential trade set ups.
You put all that together and you have a community, you have a proven system, you have real time help, real time coaching, access to myself, access to Paul, email access, support sites, forum sites, daily trades, the whole strategy, video courses, everything put together, that is what you need if you're serious about becoming a successful Forex trader.
Short cut the learning process
If you want to shortcut the whole learning process, if you want to save yourself headaches and tears and frustrations and giving up and losing money on accounts, if you want to save all of that, then take my course really is the best way to shortcut the learning process and becoming a successful Forex trader.
How do I know? Well, thousands of people have done the same thing over the last eight years and the success rate is remarkably and incredibly high. If you'd like to join us, it'd be great to have you on board.
This is Andrew Mitchem, the Forex Trading Coach. I'll see you this time next week.
Why You Need To Think Like An Investor weekly video
In this weekly video:
00:29 – Think like an Investor
00:50 – It takes time and effort to become a good Forex trader
01:25 – The retail trader chases the money
02:10 – Don’t try to live off your gains when you start trading
03:06 – An Investor looks to place less trades and is prepared to wait
04:40 – The longer term perspective – the bigger picture
06:30 – Make a percentage gain
I'm going to explain why you need to think like a true investor in order to become a successful Forex trader. Let's get into that right now.
Hi, Forex traders, this is Andrew Mitchem here, The Forex Trading Coach. Today is video and podcast number 216.
Think like an Investor
In this video, I'm going to be talking about why you need to think as an investor in order to become a successful Forex trader. Not just as a gambler as someone who sees Forex as a get rich quick scheme or someone who sees Forex as a way of solving financial problems that you may have or an easy solution, because it's not.
It takes time and effort to become a good Forex trader
Now, Forex trading, like all good things, takes time. It takes an understanding. It takes knowledge, investments, all those type of thing. You're going to get good times and bad times, without a doubt. The overall theme that I want to talk about and help you with today is you must think of trading Forex as an investor thinks. There's a big difference between most retail Forex traders who have maybe one or $5,000 and an investor who has maybe millions of dollars, certainly hundreds of thousands of dollars. There's a big difference in their mentality and their thinking.
The retail trader chases the money
You see, the retail trader … Too many retail traders, they're chasing the dollar or the pound or the yen. Whatever it is you're trading. They're chasing the money right now because they need to make so many dollars per week or per month in order to live and survive and pay their bills.
I truly understand that. I truly get that, but you cannot become a Forex trader just for the reason of trying to pay your day-to-day grocery bills, because that's not the way that you're going to learn to be a good trader. Once you understand how to be a good trader, paying your grocery bills is really … It doesn't even come into the equation, because you'll do really well from your trading.
Don’t try to live off your gains when you start trading
But when you start, don't try and live off your gains of being a trader. Another reason for that is, for most people, their account size is not big enough. It's important when you start that you realise you need to get into this in order to learn how to trade. Look at making a percentage gain.
Don't go chasing trades. Don't feel that you‘ve got to be forced to be in trades all of the time. That's another problem that I get with so many traders. I say, “Look. Just send me some screenshots of your trades,” and they're taking 20, 30, 40 trades in a day. I'm thinking, “Why would you do this?” All you're doing is just basically just placing trades and hoping that some of them are going to come right, and more than not will, and therefore you're going to make some money. All you're really doing, apart from tiring yourself out by sitting at the computer screen all day, is you're feeding your broker's pocket. You're lining their pocket, because you're taking multiple trades, and every time that you take a trade, they'll clip the ticket and make money from you.
An Investor looks to place less trades and is prepared to wait
An investor looks at less trades. They look at high reward to risk trades. They look at high probability setups, and they're prepared to wait. It's really important that you do that. I'll give you an example. I held a live two-hour trading room webinar with my clients just last night. On that webinar, I'm trading live. I'm looking for trades in real time. I've got hundreds and hundreds of clients on from all around the world. In some ways you could say there was a bit of pressure on me to take trades live because we were there. It's all well and good to show historical trades, but we're there to look at live trades.
However, I saw just one trading example yesterday. It was right near the end of the webinar. It was a sell trade on the Australian Canadian dollar. That one trade made a 2.8 to one reward to risk, so with a half a percent gain, it made me a 1.4% gain on my account just from that one trade. I didn't need to sit there taking multiple trades over and over again. I just needed to wait to see the one setup. It was showing it had high probability. I explained all the reasons for the trade. I saw the trade. I took the trade, and it made a 1.4% gain on my account just on that one trade with very low risk.
That's what an investor does. They're not sitting there forcing lots and lots of trades just because they feel they should. If that trade didn't appear and didn't show as a setup, I wouldn't have taken any trades on the webinar. It wouldn't have bothered me, because there was nothing there to take.
The longer term perspective – the bigger picture
That's where you need to look at that bigger picture, that longer term perspective. Think of an investor. It's a bit like if you're watching a video. I've planted lots of trees and ferns and bushes and things in my property here. I'm not expecting these to suddenly become massive next week or next year. I'm looking at this as an investment. I'm looking this as long-term future about growing a property and growing trees, etc. because I want to enjoy this in five and 10 years time. Same with your trading. Look at your trading as a bigger perspective, longer term thing.
Think about what your gain's going to be in six months time or a year's time or two year's time. Don't worry about this trade right now lost me money, therefore my system's no good. Another example, I had an email this morning from a guy who said, “Andrew, I'm just not making money. Maybe my system's wrong.” Not a client, by the way. He said, “Whatever I do, it seems to be going wrong.” Yet, just a few days prior, he had some good trades, and he said, “I'm just doing really well.” There's these big swings, these ups and downs and emotions that the retail trader gets into those problems.
The investor looks at the bigger picture, the bigger, longer term perspectives. Do that. Take less trades, higher probability trades. Don't feed your broker. Feed yourself or save even taking the trade if they're really not there. Think of your trading differently, a different perspective. Think of making a percentage gain on your account. Don't think, “Well, I've got a thousand dollars in my account. I'm going to try and live off that.” It's crazy. Don't think about I need to double my account every month, because again, it's crazy.
Make a percentage gain
Yes, you may do that, but I guarantee you're going to lose it at some stage. Think of it as in I've got a thousand dollars. Now, let's say over the course of the year, I can make 30, 40%, 50% even. You'll go, “Well, that's just $500, Andrew. That's crazy.” I'll go, “No, it's not. That's fantastic.” $500 is a 50% return on that account.
Now if you can do that with really low risk and controlled emotions, you can do that on a far bigger account, and a 50% return on an annual basis is absolutely outstanding. You cannot get those kind of returns from most other investments out there. Think of that investment mentality and approach, and it will really, really help your trading.
Once again, this is Andrew Mitchem, The Forex Trading Coach. Hope you've enjoyed a little look around outside in summertime New Zealand. I've had a lot of emails from people saying, “Love the outside videos,” so I hope you've enjoyed this one as well. I'll catch you this time next week.
How Leverage Can Help You Achieve Your Trading Goals weekly video
In this weekly video:
00:31 – We all use leverage to achieve things quicker and easier
01:00 – The problem with using leverage if you don’t know what you are doing
01:13 – I use leverage to help traders Worldwide
02:22 – Managed Forex Accounts using www.JASFunds.com
03:33 – Create Passive Income and a Diversified Investment
In this video and podcast, I want to talk about how leverage can really assist you achieve your trading goals. So, let's get into that right now.
Hi traders, it's Andrew Mitchem here. This is video and podcast number 215 and I want to talk about leverage, how leverage can help you and assist you to achieve your trading goals. Let's get into it.
We all use leverage to achieve things quicker and easier
Well, leverage, we use it everyday in so many ways to help us, to help us achieve things better, quicker, easier. When it comes to trading, it's no different. You see, you could go to a bank and use leverage by using a mortgage. In trading, I use leverage by using my broker's money. It's a great way if you know what you're doing.
The problem with using leverage if you don’t know what you are doing
But, the trouble is with leverage and the problem with leverage is it's a double-edged sword. If you don't know what you're doing, it can easily damage you. I've got something that can help you, two options really.
I use leverage to help traders Worldwide
Number one, with my Forex coaching course, I use leverage. I've taught over 1600 traders from all around the world. How to make money from trading but they're leveraging me.
They're leveraging my years of knowledge and experience, my ongoing support that I give people with daily, trading information. Which by the way, rough over 3% so far this week. We hold webinars. We can use leverage through webinars.
It reduces the cost. I don't need to travel to see people because the power of leverage in webinars, we all come together online. It's the same with the membership site in terms of we're using leverage for I write the post to people all around the world can get to see what I'm writing and suggesting to them on daily basis.
We're using leverage, we're using the power of the internet and we're using leverage. As in I can help so many people globally and they can tap into my knowledge and experience. That becomes leverage in terms of coaching and in terms of trading.
Managed Forex Accounts using www.JASFunds.com
Now, if the actual learning how to trade for yourself is something that either doesn't interest you. You don't have the time, you don't think you have the computer skills, whatever it might be, then I've got another option that uses leverage. It's called JAS Funds. IJ-A-S-F-U-N-D-S dot com.
www.jasfunds.com, JAS Funds. JAS Funds is a new company that I've started recently with two colleagues of mine and JAS Funds is a Forex management company. We are managing Forex accounts on behalf of individuals.
Now, there are some criteria and to qualify, you need be called what's called a “Wholesale Investor” in your own country. To find out what a wholesale investor is, visit our website and I'll put a link below this video. Also, it's JAS Funds, www.jasfunds.com. JAS Funds, you can use leverage because you can use our experience. Our trading knowledge and experience and we can do the trading for you.
Create Passive Income and a Diversified Investment
Again, it's a great way of using leverage. You can have passive income, you can use Forex as an alternative type of investment to the traditional investments. It's really quite independent to most other markets out there. If you're looking to diversify your portfolio or expand into new markets.
Then either learning how to trade yourself is one option or letting us do the trading for you is another option. So many ways you can use leverage out there within your trading and to help you overall within life.
I hope that helps. If you'd like to know more about JAS Funds, click on the link below this video.
This is Andrew Mitchem, the Forex trading coach. Have a fantastic day, great weekend. I'll see you this time, next week.
Why You Should Trade a Variety of Time Frame Forex Chartsweekly video
In this weekly video:
00:28 – Trading a variety of time frame charts
00:53 – Look to trade 2 or 3 different time frame charts
01:15 – Successful Forex Trader examples
02:25 – Different charts suit different trading conditions
03:00 – It does not mean more chart time
03:50 – A smooth equity curve by trading various charts
04:50 – Consistency and high reward:risk trades
05:12 – Free webinars and free course
I believe it helps you as a Forex trader, if you trade a variety of different time frame charts. So let's talk about that, and more, right now.
Hi Forex traders. Andrew Mitchem here, the Forex Trading Coach. This is video and podcast number 215.
Trading a variety of time frame charts
I'm going to talk about a subject that not many people actually talk about, but it's a really, really important subject. It's about trading a variety of different time frame charts. Most people trade just, probably, one time frame. In fact, most traders and new traders generally trade too short a time frame. Most people would trade five minute charts or fifteen minute charts and it's generally too quick a time frame for most traders. But, that's a subject for another day.
Look to trade 2 or 3 different time frame charts
For today's conversation, and to help you, I strongly believe that if you can trade two or three different time frame charts, then that would definitely help you to basically smooth out your equity curve and to allow for different trading conditions.
Successful Forex Trader examples
To give you an example, I've got a fantastically successful client in the U.S. called Paul. Paul's been with me for a couple of years and he's just having successful trade after successful trade, doing extremely well. On my webinar that I hold for my clients … I hold them every two weeks. Two weeks ago, Paul was on the webinar discussing some of the trades that he'd taken in the two weeks previous to that. On that webinar, he had seven or eight trades that he had taken personally, himself, on the six hour chart time frames.
Yet, on the webinar that I held yesterday, he found only one trade on the six hour time frame charts in the two weeks since that previous webinar. Between four weeks and two weeks ago, he had seven or eight trades and in the last two weeks, he's found only one trade on the six hour charts. However, during that same last two weeks, he had eight trades that he shared on the webinar that he had taken himself on live accounts on the eight hours charts. Two of them were stop out and the other six for profitable trade. That's on the eight hour charts.
Different charts suit different trading conditions
The point I want to make is, because he's trading a variety of different time frame charts … If he had just the six hour charts only, and nothing else, he would have only found one trade in the last two weeks. Yet, because Paul is choosing to trade a variety of different time frame charts, he had only that one of the six hour charts, yet eight he saw on the eight hour charts. He also shared trades that he'd taken on the twelve hour charts, the four hour and the one hour. Of course, myself and almost all of my clients all trade the daily charts.
It does not mean more chart time
So, for me, it's really important to have a variety of different time frame charts. The good thing is it doesn't involve lots and lots of time at your computer and chart watching. The way that I trade is that I only look for a new trade at the completion of a candle or the completion of a bar. You know when that's happening.
The daily charts have just closed at 5:00 p.m. Eastern Standard Time. At the same time, I can go and look at the twelve hour charts, the eight hours charts, the six hour charts, the four hour charts and, if I really wanted to, the one hour charts. There's five different time frame charts there I can look at, all at the same time. It doesn't require lots and lots of chart watching or sitting watching your computer all day and night. Far from it. We want to get away from that.
A smooth equity curve by trading various charts
What we do want to do is give ourselves a smooth equity curve and you might find that say … As an example, the four hour charts are producing some, maybe, unsuccessful trades. At the same time, the twelve hour charts or the daily charts might be producing very successful trades, very good trades. What you're finding is that over time you get yourself a smoother equity curve rather than big ups and big downs, which is not great for anybody. That's a way to get around that.
On the longer time frame charts, personally, I only enter at retracement orders only, so using buy and sell limits. It means I don't have to even be there at the time the candle closes. Most of the time, I've got a lot of extra time before a retracement order actually fills. So, you don't have to be there at the same time. What is does so, is it allows you to plan your day and work around your trades.
Consistency and high reward:risk trades
I hope that helps. It's all about gaining consistent gains, high reward to risk trades. By looking at, maybe, two or three, or four or five … whatever it is you have time for or what you like to do … different time frame charts, it really does help you become a very successful Forex Trader. If you'd like to know more, drop me an email [email protected].
Free webinars and free course
Don't forget on my website, I've also got two webinars that I hold each week, one for new traders, one for experienced traders. You can also gain access to my free engulfing candle course via my website.
This is Andrew Mitchem, the Forex Trading Coach. Have a great weekend. I look forward to catching up with you this time next week and I hope you have a successful trading week next week. Bye for now.
Splitting your trade positionsweekly video
In this weekly video:
00:34 – Most people enter at the market
01:00 – Trading the longer time frame charts – look to split your entry orders
02.33 – The keys to trading
03:13 – Taking a part of your position at the market and part at a retracement
04:30 – Entering on a retracement
05:20 – Use these lessons to help your trading
In today's video and podcast. I'm going to explain why I like to split my orders into two or more parts. Let's talk about that right now.
Hi Forex traders, Andrew Mitchem here, the owner of the Forex Trading Coach. This is video and podcast number 213. I'm going to be telling you and explaining. Why I prefer to split my positions up into two or more parts.
Most people enter at the market
You see, so many people tend to just see a trade, enter at the market, take the trade and that's it. For me, it's like well, that's okay but there's a better way of doing that. If it's a shorter timeframe chart, let's say it's a one hour chart and below where you want to ride the current momentum of the market, then fine, jumping in straight away at the market is a good idea.
Trading the longer time frame charts – look to split your entry orders
If you're trading a slightly longer timeframe chart, say a four hour chart or six or twelve or daily or weekly, whatever it might be, those longer timeframe charts where you do get retracements and you have a bigger stop loss there for you can allow for the upward and downward movements in the market, when you get those longer timeframe trades and charts that you're trading, they definitely a retracement entry is a great idea.
Well why? What I like about it, number one, you don't have to be at the chart when the candle closes. So if you're not taking a market order that you don't have to be there right at the time that four hour chart closes, let's say. You can come to charts a little bit later and still enter a trade.
The other thing is, if you're taking a retracement order using a sell limit or a buy limit, depending on whether it's a buy or sell trade, then the great thing is that you don't have to be there at your computer at the time that that price is hit because the limit order, the pending order, is stored on your broker's server. You don't even need to be there. I'll give you an example, if I'm trading say like a daily chart, then I'll enter and let's say it's a buy trade, I'll enter when the price gets lower first, but I'm not sitting there waiting for that to happen.
I‘m seeing the trade, I'm saying yeah, I like this trade, I'm entering a buy limit order so when the price retraces and gets lower, it's then filling my buy trade. It means I get in at a lot better price, like a lower price but it also means that my reward to risk on that trade is substantially increased.
The keys to trading
Don't forget that some of the keys to trading apart from low risk money management are high reward to risk trades. It's really important that you have that. You want to be making several times your risk.
When you get a profitable trade and it gets to your full profit target, you need to be making one and a half, two, three, four, sometimes even five to one reward to risk on that trade, depending on the setup of the trade. It's really important that you have the ability to take those high reward to risk trades and by entering part of your position at a better price using those limit orders and retracements is a way that you can really easily do that. Lots of benefits to that.
Taking a part of your position at the market and part at a retracement
I also do like to take part of my position straight away at the market on most trades that I take. Reason being, is let's say you're taking a buy trade and the candle closes near it's high and it just keeps continuing upwards without a retracement, and it can do that from time to time. When that happens, of course I don't want to miss out and I've got my order only at the retracement and it doesn't retrace enough to get it filled, but then it gets to my profit target. That can be slightly annoying when that happens and of course that's part of trading.
It also means that if I have a part of my overall position in at the market. Then at least I get profit on. Let's say half of that trade and the other half. Which is a the retracement doesn't get filled, that's fine but at least I get profit on the part that was in straight away. The ideal situation of course, is you get the retracement and then the price turns around at around that level that you get filled at, you have a very small draw down on that retracement order, it then goes back up again. If you're taking a buy trade, it gets obviously your buy limit in at the retracements, that's in great profit.
It then gets past your market order and that then starts to get into profit. And then fills both positions and takes that full profit on the both of them.
Entering on a retracement
That's the ideal situation and when you understand retracements and how to enter on retracements. I've got a really easy way of doing that. And of course, with all my trading I like to keep it really simple and an easy way to see the trade, take the trade, regardless of the timeframe, regardless of the currency pair. It's really important that you have the ability to do that. That's it. hope that helps.
I hope you also liked the background. Had some really positive comments and feedback from people with last week's video and podcast saying. “Hey Andrew, liking the look of summer there in New Zealand”. As you can see, more blue skies again this week. So we've had a really good time through January and February. And for those of you in the northern hemisphere where it's winter. Well I hope you're keeping warm, but for us this side of the world. This time, January, February, March is just a beautiful time of the year. Summertime, great time to be in that pool as well.
Use these lessons to help your trading
Take that lesson and let it help you with your reward to risk ratios. I just saw that, I'm pointing about the pool behind me. If you're listening on iTunes you probably have no idea what I'm talking about. But there's a swimming pool behind me. I'm going to go and enjoy that right now.
Enjoy your trading, have a great weekend. I'll see you this time next week.