Free Forex Price Action Daily Strategies from Asia Forex Mentor
Forex trading strategies: Top Down Approach
Lets look at a recent pair Eur Gbp. When we trade forex, we would always want to trade with the main trend. Even though it is an old say “trade with the trend” or “the trend is your friend”. Sometimes, it is always the simple things that works.
In this pair. As we can see from the chart above – Eur Gbp Daily Time frame.
It shows a lower lows, and higher highs – drawn by the circle in the chart. This represents an up trend.
Therefore, we would want to zoom down the time frame to look for price action + confluence entries to enter.
Lets look at the 4hr chart:
In the chart above, i have highlighted 2 pin bars in the blue boxes.
Those are good possible entries since it is form at the low of an uptrend.
Remember, it is always best to enter at the retracements of uptrends or downtrends.
And it is in confluence with the price pivot at 0.83300.
Lets look for more reasons – confluence to enter the trade. Remember, in forex trading. It is about probabilities.
The higher the probabilities, the greater the chance of winning.
Lets zoom down to the 1hr time frame:
From the chart above, we can see the highlighted box that represents the pin bars in the 4hr time frame are also pin bars in the 1hr time frame. Thats great news to see.
And, it is in confluence with the 150 moving average acting as the support.
Therefore, whichever pin bar we use as the entry point would still end up well.
To conclude, in this trade the reasons for entering are:
- The pair is in an overall up trend
- Pin bar in the 4hr time frame
- Price pivot in the 4hr time frame
- Pin bar in the 1hr time frame
- 150 moving average in the 1hr time frame
Point to exit as shown is the price pivot at 0.84000 which is a resistance area for the previous highs.
In this trade, our risk reward ratio is yet again a 1:4 ratio.
Splendid it may seem, but these are the trades we take always. Which accounts for our account size Growth!
In Forex trading, for all those who have traded forex for quite a while -
Will know that successful forex trading is actually mainly about mastering trading psychology.
Or should i say, to be successful in forex trading. You have to master trading psychology.
If successful forex trading is segregated into percentages. 100% as full score.
I will rate trading psychology + Money management as 90%
8% as Exits
2% as Entries
Therefore you can see how important it is to take trading psychology seriously as a topic itself.
However, strangely enough, this is the topic that most traders shun away from.
And sure enough, these are not the traders that make consistent money from forex trading.
Trading psychology in forex is actually about understand yourself.
Understanding your risk appetite,
Developing your discipline
Whether you are a risk taker – taking every trade you see. Or every trade which you think will go your way.
Or you are a conservative player – Over analyzing a trade, even when a good opportunity arrives. You will take too long to consider and eventually give up a good trade.
To be consistently successful in forex trading.
It is about staying discipline and only take trades that your system agrees with. or proven to work.
It is about NOT taking trades that is not in your system.
It is about NOT missing trades that are in your system.
It is about patience – waiting for your trade setups to come.
And Not take trades in the meanwhile.
It is a mental struggle with yourself. Managing your beliefs, your discipline, your emotions.
Example A): You strongly feel that this trade will go in this direction, however, the trade is not in your system.
Can you control yourself not to take the trade even though you know it will end up a winner?
Example B): You know that this trade is a sure winner, and it is in your system. You are so sure that this is a winner that you want to increase your position size to way beyond your system suggest. Example you are trading a 3% per trade. Because you feel that this is a sure winner, there is no harm placing 9% on that trade. Or 3 of the same trades.
Can you control yourself not to increase your position size even though you know it will end up a winner yet again?
Remember. Successful Trading is all about consistency.
If you allow the above example a or example b to happen. You are not being consistent in your trade.
Therefore your trade will have random variables which will not make you a Consistent Winner.
If you go against your trading rules once, you will go against it the 2nd time and the 3rd time.
If the first time you went against your trading rules and it became a winner. You will most likely break the trading rules the next time.
This is the main reason why most traders fail in trading.
Ask yourself, will a professional trader do the above?
No. The reason is because the professional trader treat forex trading as his business.
Therefore, it does not matter whether he miss a “Sure Win” trade. Because at the end of the day, he knows that he will end up a winner with his proven to work trading system.
When the trader keeps practicing the above values, and proper trading psychology.
In the initial weeks, it will be a mental struggle as it is not what you used to do.
But when you keep doing the right thing, this new beliefs will become part of you and you not longer feel it is a hassle nor do you feel that you are making any effort.
As it has already become part of you.
Remember trading psychology and start practicing it today.
And when combine with Asia Forex Mentor Price Action Forex Trading System.
Success is knocking at your door.
Forex Trading Strategies that works
Forex Trading Pair: Gbp Jpy h4
In the chart above, we can see that the Gbp Jpy is at its all time low.
In the highlighted circle, price have reached the area before in the first highlighted circle and thus we drew the price pivot in that area.
Price went back to the price pivot area on the second time, marked by the 2nd highlighted circle.
It formed a nice long nose price action pin bar.
We always love pin bars coming at the all time low and at the same time with is a price pivot area.
What can we add to our confirmation is the divergence shown by the MACD too.
Therefore we have 4 confirmation.
1) All time low
2) Long nose pin bar
3) Price pivot area
4) Divergence
In the chart, i have indicated 2 points at which we could enter.
Looking at the chart – yellow line number 2
That is entering on the break of the pin.
Our conservative stop loss would be below the pin and our take profit target would be the long highlighted blue box which is a price pivot area.
Therefore if we entered on point 2. Our risk reward ratio is 1:1.
Another way we could have entered is – yellow line number 1.
We would have place a pending buy order at the price pivot area and our stop loss will be below the pin bar.
This reduces our stop loss level and thus increases our risk reward ratio which is shown in the chart of 4:1
The set back of this entry method is the pin bar could have gone off without backtesting the price pivot and thus Not triggering our buy order.
However in this scenario, as the pin bar has such a long nose.
MOST, of the time – price will usually back test to 50% level of the pin. And that happens to be our price pivot area. Which gave us an higher probability of triggering the buy order.
Sure enough, at the end of the day. Price shot through our take profit area and went up to the 365 moving average.
But these are the market sentiments which we could not foresee.
We will be pleased with our trade with a risk reward ratio of 4:1 and if you trade this way.
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Free Forex Price Action Daily Strategies from Asia Forex Mentor
Forex Trading Psychology
Forex Trading Strategies: Risk Reward ratio 1 : 4
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