The Only Day Trading Strategy I Would Use If I Could Start Over...
Published: 2023-06-16
Status:
Available
|
Analyzed
Published: 2023-06-16
Status:
Available
|
Analyzed
Predictions from this Video
Incorrect: 0
Prediction
Topic
Status
The speaker will share a specific day trading strategy that they recommend for beginners or struggling traders.
"the strategy I'm gonna be sharing with you today is exactly where I would start"
Pending
The day trading strategy will be presented with a set of defined rules to be used as a checklist before placing trades.
"I'm going to be breaking this entire strategy Down based on a set of rules you can use like a checklist"
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The speaker used the described day trading strategy for a specific trade on the Canada Yen.
"this strategy is the exact strategy I used to get involved here on the Canada Yen"
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The video aims to provide viewers with a complete, rules-based day trading strategy suitable for new or struggling traders.
"by the end of this video you're going to have a full rules-based day trading strategy that is perfect for beginner or struggling Traders"
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The trading strategy involves the use of two different timeframes.
"this specific strategy uses two different time frames"
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One of the timeframes in the strategy is used to determine the direction (buy/sell) and the specific levels for trades.
"one of these time frames is going to be used to tell me if I'm going to be buying or selling it's also going to be used to tell me where I'm going to be buying and selling"
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A condition for this trading strategy is that price must be trending above the 50 Exponential Moving Average (EMA).
"the first thing I want to see with this strategy is that price is trending above the 50 EMA"
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The strategy dictates not trading if the trend is not clearly defined by higher highs and higher lows.
"if it's not an extremely clear Trend meaning if you can't clearly see prices making higher highs and higher lows then I just simply don't trade at that time"
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After determining the trading direction (buy/sell), the next step in the strategy is to identify the specific entry location.
"once I know I'm looking for bad trades that's step one which direction do I want to trade the next step is where where am I looking for those buy trades"
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A key feature of this strategy is that it identifies only one specific location for placing trades, making it beneficial for beginners.
"for this specific strategy it's only one place that's why this strategy is so good if you're a beginner or a struggling Trader with your day trading is because we're looking for one place to place a buy or sell trade"
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The entry area for buy trades in this strategy is the previous high that has just been broken, where price is expected to pull back to.
"right here at the previous high that was just broken is the area I'm looking for price to pull back to in order to place possible by trades"
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In an uptrend, the 'where' for buy trades is identified as a previous level of resistance that is expected to act as support.
"the where is the previous level of resistance that's likely to become support in an uptrend"
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The strategy uses the four-hour chart to identify both the trend direction and the structure level (entry point) for trades.
"I look for Trend on the four hour chart and I also look for the structure level or the where do I want to buy on the four hour chart"
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Once trend and structure are identified on the four-hour chart, traders wait for price to enter the zone before switching to the 15-minute chart for entry.
"after I have these two things pointed out I wait on this time frame for prices to get into that zone then I drop down to my day trading time frame which is the 15 minute chart"
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The strategy can be adapted to lower timeframes by analyzing trend and structure on the one-hour chart and executing trades on the five-minute chart.
"you can also use this on even lower time frames by looking for Trend and structure on the one hour and looking for your trades on a five minute chart"
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On the 15-minute timeframe, the strategy looks for either a double bottom or a head and shoulders pattern within the identified trading zone.
"on the 15 minute chart I'm looking for two very specific chart patterns using this strategy I am either looking for a double bottom in this zone or I'm looking for a head and shoulders pattern in this Zone"
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Confirmation for entering a trade based on a double bottom pattern requires a break of the neckline, indicating continued buying pressure.
"I want to see a break of the neckline I want to see a breakout showing me that buying pressure is going to continue past the double bottom"
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The conditions for the bullish version of the strategy are an uptrend on the 4-hour chart and a pullback to a previously broken resistance level.
"conditions would be four hour chart it's in an uptrend and is pulled back to the previous resistance that was broken in this uptrend"
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Entry occurs in the zone when price forms a double bottom with a neckline break or a head and shoulders pattern with a neckline break.
"the entry for this strategy would be we're in our Zone and price either makes a double bottom and breaks above the neckline or makes a head and shoulders pattern and breaks above the neckline"
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For the bullish strategy, the stop loss is placed below the identified trading zone.
"the stop loss goes below the zone that I created"
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The bearish version of the strategy is a mirror image of the bullish version, with all parameters reversed.
"the bearish version of this strategy is the same exact thing just flipped upside down"
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For the bearish strategy, price should be below the 50 EMA, making new lower lows and lower highs.
"instead of being in an uptrend let's say this is our 50 EMA we want to see prices making new lower lows and lower highs now below the 50 EMA"
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In the bearish strategy, the entry zone is identified by a previously broken support level.
"instead of looking at a previous resistance we're actually going to be looking at the previous support level that price has just broken"
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In the bearish strategy, entries are made upon the break of the neckline of a double top or head and shoulders pattern formed in the entry zone.
"we're gonna be looking for either double tops or a head and shoulders pattern and the entry will be the break of the neckline"
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The conditions for the bearish strategy are a downtrend on the 4-hour chart and an identified structure area for trading.
"the conditions were four hours shows me Trend in this case it's a downtrend and four hour shows me an area of structure like we have here that I'm going to be trading in"
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A valid trade setup in the bearish strategy is confirmed by a double top pattern and a subsequent break below its neckline.
"here we have another double top okay so now we're looking right here this is our double top we have one top here followed by our second top all we need is a break below this neckline and we have a valid trade"
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Contrary to a common belief, professional traders do not make money by knowing exactly where price will go on every trade; they achieve profitability through other means.
"professional Traders make money is because they knew exactly what price was going to do and every trade they place they just won those trades but throughout my trading career I learned that that's not the case at all"
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Professional traders operate based on a statistical advantage that proves profitable over a large number of trades.
"the truth is that we are trading as professional Traders whenever you be become a professional Trader you will be trading based on a statistic advantage that plays out over a large sample size of Trades"
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Profitability in trading stems from consistently executing a proven, rules-based system that demonstrates profitability over a significant number of trades.
"it's about trading a proven rules-based system that's proven to be profitable over a large sample size of Trades"
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Higher risk per trade is directly correlated with increased emotional responses during trading.
"the more money you are risking on each trade the more emotional you're going to be"
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For beginner or struggling traders, the primary goal is not maximum profit through high-risk trades (10%+ of account), but rather learning and survival.
"until you become good at trading your point in trading is not to try to gain as much money as you can by risking 10 percent or more of your account"
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Risking a significant portion of one's account (10% or more) as a beginner trader will likely lead to account depletion.
"if you do that you will blow your account"
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Beginners and struggling traders should employ lower risk management to reduce emotional impact from losses and to slow down the rate of loss.
"your risk management needs to be much much lower so that you mitigate the emotions you have when you have losses and you lose money slower"
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Traders should exclusively focus on strategies that have a high probability of being profitable in the future.
"the only strategies you should be trading are strategies likely to be profitable in the future"
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Backtesting is the method used to determine if a trading strategy is likely to be profitable in the future.
"the way that we determine if something's likely to be profitable in the future is through back testing"
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Backtesting not only validates strategy profitability but also builds confidence, aiding in managing drawdowns, losses, and improving trading psychology.
"this back testing process also gives us an incredible amount of confidence that helps us deal with drawdowns losing trades and helps us handle our emotions and have a better trading mindset"
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The speaker is offering mentorship to 500 new or struggling traders for the remainder of the year to guide them towards profitable trading.
"I'm looking for 500 new or struggling Traders to Mentor throughout the rest of this year on their journey to profitable trading"
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