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STRATEGY
THE ONE TRADING STRATEGY
YOU WISH YOU KNEW BEFORE
TRADING
Introduction
I want to thank you and congratulate you for downloading the
book, Winning Trading Strategy.
Trading is a constant battle where you have to learn the best
tools, strategies and techniques to have an edge and make
money. You too will transform your trading when you learn the
strategy and the information I am sharing with you in this
book.
To be a consistently profitable trader, you need have to have a
clearly defined strategy with rules on how to act in the market.
Find technicues in this ebook that fits you and become the best
trader you can be. Here is a preview of what you will learn:
The importance of a trading plan.
Why you should track your trades.
The importance of knowing yourself and your mind.
The one trading strategy.
A risk management strategy.
And much more!
Thanks again for downloading this book, I really hope you
enjoy it!
Best Trading,
Johan Nordstrom
http://www.TradingWalk.com
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for your
personal
use only.
You
cannot
electronic,
or
mechanical,
including
photocopying,
Trading Plan
One of the biggest mistakes most new traders make, is to
trade on emotions, tips and whatever catch their attention, it
can work for some time, but not in the long run. To be a
consistently profitable trader, you need to have some rules on
how to act in the market. Have you ever experienced
something like the example in the chart below?
If you have a trading plan, you will always know how to act in
the market and where you are going to place your trades and
take your wins and losses. Your trading plan primarily consists
of a set of rules you should follow to profit in trading. You will
take out much of the anxiety being in a large losing position
when you, for example, have stated in your trading plan; you
only risk one percent per trade.
Having a trading plan makes trading easy and enjoyable, it
takes the fear, anxiety and complexity out of it. If you are in
the market for the thrill, then you are not in it for the money,
so if you are in it for the money; have a trading plan.
It is difficult to follow a trading plan since it is in our nature to
bend and break rules. You need to have the discipline in order
to act consistently according to your rules. Done right and you
will profit for the rest of your life and become the best trader
you can be.
Read more in my post Trading Rule: Plan Your Trade And
Trade Your Plan.
Or go here: tradingwalk.com/trading-rule-plan-trade-tradeplan/
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The Strategy
This is mainly a reversal strategy of the micro trend in the
direction of the macro trend. An example can be a micro
downtrend in 1h chart but the daily chart, macro trend, is in
an uptrend. The strategy can be traded both long and short
and as a day trading strategy or swing trading strategy on
your favorite time frame, we mainly trade this on daily, 4h and
1h time frame. It is an ABC setup, but we will get to that.
To keep it simple, we use two charts to define the micro and
macro trend. We define trend by looking at higher highs and
higher lows and the candlesticks body range, if red candles are
bigger than the green the trend/momentum is down. You can
certainly use your favorite moving average to define trend. We
keep it simple, no need indicators. Candlesticks are our price
action and what we will use to give us the entry and exit price.
Setup
We can see that we have a downtrend, 1) the price action start
in the upper left corner and is now in lower right, lower lows
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and lower highs 2) the red candle bodies are bigger than the
green ones (the daily is also in a downtrend). Therefore, we
look at a short trades. Now to the setup, to have a short setup
we want:
A break to new lows.
A rally against the trend (A move).
A move to the downside (B move).
A Break of the rally high (A point) creating a new high (C
move).
We try to enter as high as possible on the C move before
it reverses back down with anticipation of breaking new
lows.
Setup Upgrage!
Round numbers often act as support and resistance, therefore,
place orders at these levels or just low/above round number
levels.
Setup Upgrade!
Symmetry is importaint; therefore, measure the A move and
anticipate that the C move might be similar. With symmetry
you increase the probability of a winning trade.
Illustration
Below is an illustration on how the setup should be traded, I
have illustrated it in a simple drawing and we will also use a
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Entry
To find the zone where the C move might end. We draw a Fib
extension between the low and high of the A move to get our
short zone between the 1.279 and 1.618 extension. When we
have the area, we look left for a green small candle body and
place the entry at the open of that candle, close to 184.100.
Target
Exit the position at 182.500 closest round number to the open
of the red candle at the low point of the A move, giving us a
positive risk reward (reward greater than our risk).
Stop Loss
Place a stop loss order just above the short areas closest
round number (above Fib 1.618 extension [184.575], closest
round number [184.600]). We place stop loss at 184.620.
The Result
Like many other times, we traded this strategy and produced a
winning trade. Be observant, these setups form over and over
again making it possible for you to profit day in day out. Did
you look left on the chart? Well then you probably found this
setup too:
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Example
Your initial account capital is $100.000. You invest everything
and suffer a 50 % loss, account decrease to $50.000
(=$100.000*0,5). You invest everything again and get a 50 %
gain, account capital increase to $75.000 (=$50.000*1,5), but
that is $25.000 short of what you initially had. You need a 100
% gain after a 50 % loss to come back to break even. Have a
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You can now enter your trade with 3.333 contracts and if your
stop loss is hit you will know that you only lost one percent of
your account and you will live to trade another day!
This is a simple risk management strategy, it is an essential
strategy you understand and apply to your trading if you want
to achieve trading success. Avoid blowing up your account, like
so many traders do every day.
Click here to read my blog post Do Not Dig Yourself Into A
Hole.
Or click this link: tradingwalk.com/trading-rules-do-not-digyourself-into-a-hole/
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Take Action
Yu nd to t the whl f hng to become the best
trader you can be in motion t th earliest rtunit.
Identify n tin which u can tk to get thing ging nd
tk tht action n as ibl so you get started.
Action is defined as "the act or process of doing something,
typically to achieve an aim. There is absolutely nothing more
important than taking action, because without actually getting
started, you will literally make zero progress. It does not
matter how much planning you have done, if you do not get
started you will still be sitting at square one wondering why
everyone else is making progress and you still are not.
"The secret to getting ahead is getting started"
Read the statement above three times aloud. Now think of a
time where you really wanted to do something, but you never
got it done because you never got started. It is not a pleasant
experience to reminisce about, is it? You can make up all sorts
of excuses, alibis, etc. However, the only reason why you did
not accomplish what you desired to do was because you never
even began what you wanted to do!
Perhaps you put it off until tomorrow, and tomorrow never
came. Perhaps you were just really busy and neither had the
time nor the energy to work on that side project, or finish that
book, or learn how to trade. The thing is, we as humans are
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Package,
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Conclusion
Thank you again for downloading this book!
The next step is to take action, practice and trade this strategy
so you learn it by heart. I belive in you!
One more thing: if you liked this book, would you be kind
enough to leave a review and feedback on this, email me at
johan@tradingwalk.com
Thank you and to your success!
Johan Nordstrom
http://www.TradingWalk.com
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Or simply search for tradingwalk on those social medias.
And when you do, say hi!
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