WAIT !!!

2 TRICKY QUESTIONS For Your First before You proceed …

1)  How do You KNOW ” Whether ” A Trend Would CONTINUE In The Previous Direction ?

…ALSO

2) How do You KNOW ” Whether ” is it a REAL RETRACEMENT for a Trend Continuation ….

Any idea what is possibly the best answer to the 2 questions above ??

……Most of the ( struggling ) traders simply DO NOT have the answer at all for these 2 “ Tricky ” questions..

That’s why they would keep losing and losing while trading the market………due to the fact that they just cannot handle these 2 ” Tricky ” situations CONFIDENTLY…..

If You’re also one such trader who has been facing such challenges & dilemma all these while…..

…..Causing You to fail to achieve the trading success ( and Profits ) You truly want -  DUE to these 2 ” Tricky ” situations..

Then please read the entire article below as I share a few simple & effective solutions which You can use to  help overcome them in no time.

This is also the exact strategy I used to profit a total of 100 Pips from trading the USDCHF pair.

With this hint, I know there would be good SHORTING set-ups coming soon over the next few days.

So from that moment on…… I would begin to monitor for further HINTS & Price Actions showing in the market before I finally commit into a SHORTING trade.

Well….if You have been following my forex tips for sometime now.

You should already know that I am a very careful trader….

….. and I ONLY commit into a position provided there are ” multiple RELIABLE Price Actions ” in the market to support my intention.

Without appropriate and adequate ” Confluence ” from the market to support my intention….I would rather give that trade a miss…

….Than to jump in and just try my luck….

Not the way to do it if one is serious about succeeding in the long run.

Likewise for this USDCHF trade as well.

Let me show You every single ” Price Actions ” from the market that I took into consideration - BEFORE SHORTING this USDCHF pair next.

In order to do so, I will be monitoring for the price actions in both the 4 hourly & 1 hourly charts.

For now, I will be monitoring the 4 hourly until the market is getting ready to be SHORTED !

Here’s the first 4 hourly chart & what ” hints ” I look out for :

( click to enlarge )

The price movements within that 2 lines are what contributed to the BEARISH LONG CANDLE You saw on the daily chart earlier.

After that, price start to climb

( Retracement for the Trend Continuation ?? OR Total Reversal ?? We DON’t KNOW !! ).

So do I start to look for SHORTING Hints ??….. now that the price is in ( possibly ) a retracement after the bearish fall ?

NO…….NOT now though.

Because I need to ” confirm “ that there’s a high possibility of SELLERS in the market who are keen on SHORTING this pair further…

…BUT Aaron…..why need to do that ?

Here’s why :

You see………though I seen a BEARISH LONG CANDLE on the daily chart…

But the actual fact is that this USDCHF pair is on a long term BULLISH prevailing trend.

Here’s illustration to show You :

( click to enlarge )

So since I intend to SHORT this pair ….it means I am opposing the ” Prevailing Up-Trend ” in the market…..

By doing so…..

I need to be ” extra careful “ while waiting for as many hints as possible to confirm my SHORTING intention before jumping in.

“….so how do I confirm that majority of SELLERS in the market are willing to push this Down-Trend further ? “….

Simple..!

Just wait for the market to create a ” new LOW “…..on the 4 hourly chart.

Like this :

( click to enlarge )

And once a ” New Low ” is in placed..

It is indeed a good hint that the trend could possibly be pushed further by the Sellers ….” again “.

With the above… it is also my answer for the 1st ” Tricky ” question I prompted You at the start of this page.

Which is :

1)  How do YOu KNOW “  Whether  ” A Trend Would Continue In The

Previous Direction ?

But……..jumping into the market while spotting that ” New LOW ” is NOT SUFFICIENT for me to commit into a SHORTING position at this point though.

By doing so, I am NOT putting myself at an advantage that is.

With this advantage ….I mean this :

“..You want a proven & reliable set-up which enables You to WIN MORE than YOU LOSE…….most of the time !! “

What is that set-up ?

It is none other than a ” Price Retracement “.

So definitely having spotted a ” New LOW ” in the market.

We can only jump in for our SHORTING positions WHEN the price has Retraced to an appropriate level.

Remember this important fact : - Because it could be a total reversal instead of a retracement.

So it is really our responsibility to monitor every price actions closely and use them to help us confirm whether is it a retracement…..or a total reversal.

Do You know how ?

If Not….read on below please.

I shall share the important details which would answer the 2nd ” Tricky ” question too.

Which is this :

—————————————————————————————

That’s Right !!…..By taking advantage of a ” Price Retracement ” during a trending market…….the risk would be Minimal…..& at the same time the Rewards achievable would be Maximized………no doubt !

BUT…..

2) ….How do You Know ” Whether ” is that a REAL RETRACEMENT

for a Trend Continuation……..and NOT a ” Reversal ” ( that would

hit Your Stop- Loss ) at all ?

—————————————————————————————–

Here’s The Answer :

There are a few ” Important Hints ” that the market has to give me first…..in order to help me confirm that it is a Real Retracement . ( for this Bearish Trend Continuation )

————————————————–

1st Important Hint :

————————————————-

- The price has to retrace back ( as close as possible ) to the previous support level.

Like This :

( click to enlarge )

Without seeing the price hitting that ( important ) level at least…

I would NOT even consider shorting this pair again.

Why so…?

Purely because I like to put all odds on my side definitely.

That explains why I am never ” worried / fearful ” on any trade I decide to commit on.

That’s because I don’t compromise / deviate from my ” winning trading rules ” at all.

* smile *

——————————————–

2nd Important Hint :

——————————————–

- If price does gets there, it has to form price actions / patterns to show that Strong SELLING Sentiment is still in the market.

Like This :

( click to enlarge )

Price does RETRACED to the level I am watching out for.

( which is the level that coincides with the previous support level )

And even shown some sort of ” Buying Rejection ” at that level.

Which resulted in a ” Inverted Pin-Bar ” in the market.

These hints are being extracted from the 4 hourly chart.

So in order to monitor the more ” detailed Price Actions ” to help me get ahead of the majority…

I would drop to the next smaller time-frame which is the 1 hourly.

Here are the hints I am looking out before ” finally ” committing to the SHORTING position.

At this stage, I would consider it the ” most critical ” aspect of trading.

Due to the fact that if I commit one wrong analysis ( or trading on impulse )….it would result in a disappointing outcome end of the day.

Again…most ( struggling & failing ) traders actually DISLIKE this stage of the analysis because they would ALWAYS get very indecisive.

On FEAR that it would be yet another LOSING trade for them….just like the previous ones.

But trust me on this…

Once You KNOW what ” hints / price actions ” to look out for at this stage…

And then weight the Risk Vs. Rewards aspect….

There is really NOTHING to be fearful about then.

Because once You can confidently gather such ” Hints ” from the market in a Logical Approach Manner ….like me.

Your monthly results would be almost in the ” positive zone ” then.

Don’t believe ?

Put in the time and effort for now..

And then tell me about it in 2 - 3 months time ….* smile *

Do remember to try on a DEMO account if You’re doing that.

Or start ( really ) small if You want.

Trading on MICRO lots……with a starting capital of maybe USD$250.

Am sure You can afford to lose that amount if worst come to worst right !!

Just remember to ONLY use the amount that You can AFFORD TO LOSE !

—————————————————————————

1st Hint after dropping to 1 hourly chart :

—————————————————————————

( click to enlarge )

The ” yellow line ” is the same line I marked on the 4 hourly earlier indicating the PREVIOUS SUPPORT LEVEL.

( just in case You’re confused by it.)

And the price movements within the 2 blue lines are what contributed to the ” Inverted Pin-Bar ” on the 4 hourly.

When I noticed this ” Inverted Pin-Bar “, it is already 12 midnight at the country where I reside. ( Time zone GMT + 8 )

So I really can’t do much because I need to sleep by then.

I normally do not stay up past 1230 on most nights.

Sleeping early and maintaining a regular bio clock is one essential aspect of being a ” Healthy ( Winning ) Trader “……..agree ? * smile *

For anyone still struggling and trying to achieve the success they want out of forex trading..

Then all the more they should get enough ” quality sleep ” of at least 7 hours.

Best to be between 11pm - 6am interval.

Not related to the strategy I am sharing today….but just thoughts of mine to share though. * smile *

So by the time I wake up the next morning…..

This is what I saw on the 1 hourly chart for this pair …

———————————————————————-

2nd Hint After Dropping To 1 Hourly :

———————————————————————-

Like this :

( click to enlarge )

One terrible thing that can make most traders ” rather anxious ” is to spot a potential set-up JUST BEFORE it is time for them to rest for the day.

If he / she is willing to stay up ……there is NO guarantee that the market would show the ( required ) potential set-up they want.

OR…

The market could be in the ” Retracement / Sideway ” stage for 8 hours or more straight off…….until the next day active trading hours.

NOW……..are You going to sacrifice Your precious sleep considering there are so many uncertainties involve ?

I for one….would NOT sacrifice my precious sleep definitely.

For this trade, I would use a ” Sell - Stop Pending Order ( with very tight stop-loss because I am not there to monitor the price actions ) ” to catch the bearish move…. if it does MOVE while I am sleeping !!

But since it did not get trigger.

I shall not talk about it here.

Reserve that for another strategy.

As a matter of fact, I would much prefer to avoid using a ” pending order ” as far as possible though.

Unless I am trading the much bigger time-frame and ride the long term trend which could last for weeks.

But then…….that kind of strategy would need a much bigger risk ( stop-loss ) too…..& the good set-up does not happen as often as while trading intra-day.

Again….more on that on another strategy on ” SWING Trading “.

For now……let me continue with my explanations.

Here’s the illustration to help You recap :

——————————————————————————-

This is what I saw on the 1 hourly chart for this pair …

2nd Hint After Dropping To 1 Hourly :

Like this :

( click to enlarge )

———————————————————————————-

So do I jump in to SHORT instantly upon seeing that bearish candlestick at about 10am ( GMT 0200 ) while I check the chart ?

Of course NOT..

Every single decision I made as regards to trading must be based on the actual Price Actions in the market.

Then for this critical moment of ” deciding WHEN to SHORT ” this pair..

What Price Actions do I look for then ?

Here’s the answer for You :

——————————————————————

3rd Hint After Dropping To 1 Hourly :

——————————————————————

( click to enlarge )

For the ” final ” market hint which I used to support my SHORTING intention.

I am using a ” Trend-Line Violation ” as an indication.

Previously, the ( green ) line acts as a support for the price movement at this period.

So once ” Violated to the DOWN-SIDE “….it is definitely a clear indication that the sellers are coming into the market again.

If You notice on the illustration above again..

I only use the ” 2nd Bearish Candlestick Closed ” for my SHORTING Entry….

This is so because I want to avoid a ” False Breakout ” out of that channel.

False Breakout is very common in any financial market ( perhaps due to to Stop-Loss hunting by the brokers )….so I always like to ” confirm ” that I do not get caught by it unnecessary.

Anyway, the price did not fall too far from the first candlestick…

So all good.

I SHORTED at the price of 0.89734.

( 2 separate Lots as usual as I would be executing the ” Partial Exit ” technique )

How about the Stop-Loss placement for this trade ?

Without entering a stop-loss, it is just like driving a fast car WITHOUT a functional braking system.

When I am WRONG about a trade and it’s direction, I would want to get out as soon as possible in order to ” limit” the amount of losses that would incur.

And NOT to hold onto a losing trade….and let it drag on and on……

When that happens……I might as well CUT loss ” earlier “…and ride on the other side of the REAL trend……right ?

But I do not advocate guessing a stop-loss value to be used in any trade.

It has to be strategically place…

Best place is on the recent Lows….or at the the recent ” Price Pull-back “…

Not a 100% sure thingy….but at least if the price was to violate those levels.

I would want to play safe and get out to prevent ” entering into the wrong direction ” to drain my account further.

Here’s the ideal location I would place the SL for this trade:

( click to enlarge )

…Just above the recent price pull-back.

With a tight stop-loss value of 40 Pips .

( SHORT Entry @ 0.89734, Stop_Loss@ 0.90134 )

40 Pips as Stop-Loss for a pair like USDCHF is neither too big ….nor too small.

Just nice I would consider as the daily ATR is about 100 - 120 pips movement for this pair.

As I am taking advantage of the Price Pull-Back during a trend….so 40 Pips would be appropriate.

Having explained on the Shorting Entry & Stop_Loss needed….

What is another element that needs to be planned before committing into any real position in the market ?

Obviously it is the Take-Profit ( TP ) levels.

So next I would be explaining on that.

Here’s the illustration on how I plan my ( 2 ) TP levels to share :

( click to enlarge )

Since I am aiming on short intra-day moves on this USDCHF pair..

I am aiming for only 40 Pips for TP #1 - Which is also my Stop-Loss amount.

( once TP #1 profited, stop-loss order for TP #2 would be shifted to BREAKEVEN )

And 60 Pips for TP #2. ( which is 1.5 times my Stop-loss of 40 pips )

I am not including a TP #3 for this position because the major prevailing trend is NOT yet a Bearish one.

( meaning it is still an up-trend as shown on the daily chart )

So I would not want to include the 3rd Take-Profit target for this set-up.

Reason being is that though I can execute another ” Partial Exit ” with that during a trend..

But if I am wrong….then I would incur an ADDITIONAL ” Stop-Loss ” that comes with the 3rd order.

That’s exactly my thought ” just before ” I commit into this position.

Hope it has helped clarify on that aspect now……if You need to know.

* Smile *

So How Did This Trade Turns Out ?

Here’s the answer :

( click to enlarge )

Both my Take-Profit #1 & #2 have been triggered after about 9 hours of trading.

The most important element is when the TP #1 has been triggered…( meaning profit target hit ….)

The stop-loss of Take-Profit #2 has to be shifted to the ” Break-even ” point.

And I am using a special script to automatically do this task for me - So that even while I am sleeping, it can be fulfilled.

( ….According to the pre-set value I input that is. )

As usual, just like other strategies I shared previously…

…. I would always include the screen-shots of my actual ” Entry, Stop-loss & Take-profits ” to share as well.

( Earnings For 1st Exit Order )

( Earnings For 2nd Exit Order )

At this point, I have pretty much shared what I want to as regards to the ” 2 Tricky ” situations that caused most traders to feel dilemma and fearful when facing them.

Which results in illogical trading decision being made and lead to disappoint outcomes ….trade after trade.

One thing I am pretty sure here…

It is that….for anyone who is new to Forex Price Actions trading.

What I have shared above could be ” rather confusing ” to them.

If You’re also one such trader…

Then do make sure You go through a few more times…

And each time You’re reading a certain portion of my explanations above..

Do fire up Your chart….and try to look for ” similar set-ups ” on from the past results…

Most importantly while doing so….test Yourself on whether can You ALSO analyze the market the way I do.

This is one good way to learn.

Especially with price actions, You need to get familiar with watching the RAW market data - The Price Actions !

To conclude my sharing on this USDCHF strategy today.

I will be writing a summary of the ” Important Considerations ” I make during certain stages of the market analysis for this USDCHF trade.

If You need to go over what I wrote above again..

Then do read my summary below first as it would help You form a ” Proper Picture ” of what to expect at each different stage of the analysis.

————————————————————————————

SUMMARY On

…. WHY & HOW I SHORTED THIS USDCHF PAIR :

———————————————————————————-

Basically the entire USDCHF strategy is to help answer the 2 common

” Tricky ” situations that most ( failing ) traders are suffering from.

They are :

1)  How do YOu KNOW ” Whether “  A Trend Would CONTINUE In The

Previous Direction ?

…ALSO

2) ….How do You Know ” Whether ” is a Retracement  a REAL

RETRACEMENT for a Trend Continuation……..and

NOT a ” Reversal ” ( that would hit Your Stop- Loss ) at all ?

And with a winning trade that I nail on the USDCHF pair…

I find that the entire ” analysis ” really does require me to answer the above 2 ” tricky ” situations.

So I decide to write out this USDCHF strategy to share and help fellow readers in need.

Let’s begin….

1) Having spotted a LONG BEARISH CANDLE on the daily chart….

( click to enlarge )

…. I can start monitoring the 4 hourly chart for further ” hints ” to support my intention to SHORT AGAIN.

2) Upon dropping to the 4 hourly chart, the price then has started climbing upward……

But whether is it a retracement ( for a trend continuation ) ….or a Total Trend Reversal….

..We really don’t know at this stage.

( click to enlarge )

Yes, some traders would just jump in and start shorting once the price is at a certain FIBO level/s.

But that’s not my style.

In fact, I have to be ” Extra Careful ” instead just like what I mentioned above earlier…

Because on the daily chart, the prevailing trend is still on the BULLISH side..

( click to enlarge )

If I am SHORTING this pair now, I am opposing the prevailing trend that is.

So taking that into account, I have to monitor further for ” as many hints as possible ” before committing.

With that….it would bring us next to one of the ” Tricky ” question I asked You at the start of this page..

That is :

1)  How do YOu KNOW ” Whether “  A Trend Would CONTINUE In The

Previous Direction ?

Read below for my step by step explanation on this.

3) While still using the 4 hourly chart, the price climb to a certain level & then PLUNGED downward……breaking the previous support…and forming a ” NEW LOW “.

( click to enlarge )

With this ” NEW LOW ” in place, it is a good hint for us to confirm that - This Trend would ( most likely ) CONTINUE in the previous direction.

Because the Sellers are still keen on pushing the price Lower…

4)  With that ” NEW LOW ” confirmation, we can then monitor for a good price level to get in to SHORT this pair.

However….

For any position we wish to enter, we have to always capture a set-up that enables us to trade with ” Minimum RISK….yet ( Realistically ) achieving the MAXIMUM Rewards ! “

And the only set-up that would make this possible is with the ” Price Pull-Back ” during a trend.

With that….it would bring us to the 2nd ” Tricky ” question I prompted You at the start of this page.

That is :

That’s Right !!…..By taking advantage of a ” Price Retracement ” during a trending market…….the risk would be Minimal…..& at the same time the Rewards achievable would be Maximized………no doubt !

BUT…..

2) ….How do You Know ” Whether ” is that a REAL RETRACEMENT

for a Trend Continuation……..and NOT a ” Reversal ” ( that would

hit Your Stop- Loss ) at all ?

5)  In order to convince myself that this is a REAL & VALID Retracement for the trend continuation…..

2 important hints need to happen in the market :

i )  Price has to ( at least ) hit a level that coincides with the previous Support.

ii ) Once that happens, market has to show a certain price actions / patterns that reflect ” Selling Force ” coming into the market.

Like this :

( click to enlarge )

6) Once the 2 important hints have formed in the market…

It is still not enough for me to get in to SHORT.

Because though there is a ” Selling Force ” detected at the level I wanted…

But that does not prove that majority of the sellers are going to SHORT at that position too.

So it is really critical to switch to the next smaller chart ( 1 hourly ) and then watch for the ” commencement of the Selling Move “….

For this USDCHF trade, I spotted a ” Trendline Support ” VIOLATION..

( click to enlarge )

With that in sight, I know it is time to SHORT the market then at Price 0.89734

( after also considering the Stop-Loss needed and WHAT Take-Profits to aim for at the same time.  Read below )

7 )  What Strategic Stop-Loss Value Is Needed For This Pair ?

Using a ” wild guessing value ” for stop-loss could work sometimes..

But in the long run, it would not be a good idea as there is no consistency in the ” risk ” involved with all the positions we enter.

Stop-loss should be placed on a ” strategic ” location in which IF VIOLATED…..it means it is better for us to get out.

And one such strategic location would be on the ” recent price pull-back “.

Like This :

( click to enlarge )

8 ) With Entry & Stop-Loss determined, the 3rd essential element would be the Take-Profit Targets.

Without planning the target levels….market could hit and then BOUNCE up and turn against YOU.

So though the market has actually reached the level You wanted..

But because You did NOT Pre-set in Your trading platform..

You are not enjoying those profits ” automatically “.

So whenever I am trading on intra-day basis..

All 3 parameters - Entry, Stop-Loss & TP levels would be determined at the same time.

As usual, I would be executing the ” Partial Exit ” technique.

This is mandatory as the success rate is higher….and I can ” Lock in & SECURED Pips ” as the trade goes my way.

Here’s the TP levels I planned for this USDCHF trade :

( click to enlarge )

8 ) How Did The Trade Eventually Turns Out ?

Here’s the answer :

( click to enlarge )

One last point to note here before I pen off.

Once You can confidently handle the ” 2 Tricky ” situations each time You’re trading the forex market…

Especially on a short-term ( intra-day ) basis…

Your trading results would take a 180 tremendous change for the better.

No joke.

Because for myself, my success also came once I can ” naturally ‘ analyze the market the way I shared above..

It does not happen overnight definitely…

But if You master one element at one time…

Yes…just one….

Soon…..You would be able to put them ALL together to form a perfect winning formula as well.

I am also rather ” fearful ” about learning the UNFAMILIAR then….which was 5 years back while still a struggling newbie.

In fact I am worst…..

……because I do not have someone to share such ” step-by-step analysis & the right decision making process “ to me then…

I rely entirely on my own trial and error to gauge what’s wrong….what’s right…

And most important….what’s going to be RIGHT IN THE LONG RUN …

That’s truly on a ” Self-Educated ” basis.

Lots hard-work….no doubt.

But I am glad I learned on a self-educated basis when I look back now…because I actually ” feel & notice ” things that cannot be learn elsewhere.

That’s a fact.

I can ” feel ” the market sentiment better in the process.

Especially when I am relying on nothing else but ONLY the Price Actions in the market.

By doing so, I am very customized to extract the ” real hints ” from the series of RAW Price Actions data !

And by doing that again and again on a self-educated basis…..I only get better and better week after week.

So if You’re also aiming for be a competent Price Actions trader…

Don’t give up.

Keep up the effort and stay motivated ya.

One day….I am sure Your hard-work would be rewarded….many many times…* smile *

Well…needless to say….

Earnings like this would be day in day out for You as well !

( Earnings For 1st Exit Order )

( Earnings For 2nd Exit Order )

And the true beauty of being able to handle these 2 ” Tricky ” situations is that ….

…You can almost trade on any currency pair You like.

Using the same analysis & decision making process to handle the 2 ” Tricky ” situations.

Which also means…..earnings such as the ones I earned for this USDCHF trade of about Usd $5,641.00 …..could then be profited….again and again.

Of course without the ” Fear, Dilemma & In-decisive-ness “ You used to suffer from ….previously.

Alright…so much for this intra-day Strategy which I used to grab 100 pips out of the USDCHF pair “…

I shall pen off now..

Thanks for reading this far..

To Your ( absolute ) FOREX SUCCESS,
- Aaron Tan ( your trading friend )

…..In this post, I am going to share a Forex Trading Strategy which takes advantage of these 2 important elements happening in the market :

1)  Price ” Bouncing ” Off  A ( Down ) Trend - Line

2)  And Then….. Relying on a ” Bullish REJECTION Zone “ To Acheive A  High Probability ( Low Risk…HIGH Rewards ) Entry..

Read on below as I share this profitable strategy in a step-by-step manner for You !

For a ranging market… ( or the so called Sideway market )…..

We would use a ” Horizontal Line ” to mark out the the important Resistance / Support levels….

Well…that is for a Ranging Market though……BUT how about a ” Trending ” market.. ?

Hmmm….You still can use a Horizontal Line for a Trending market somehow…..

HOWEVER…..by doing that….

….. You would most likely be getting many FALSE signals from the market as the resistance points would be shifting higher & higher…( for an up-trend )…

…as well as seeing Support points ….shifting lower & lower…( for a down-trend )..

So by using a Horizontal Line for a Trending market….it is NOT beneficial at all to help with Your market analysis..

On the other hand…..if You know how to use a Trend-Line ( and NOT a Horizontal Line ) for a Trending Market..

It could help You Pin-Point ” High Probability Turning Point “ to get into the Trend again…..in order to achieve a Low Risk & HIGH Rewards trade.

Which also means You can ” Project A Future Turning Point ” way in advance when You see the Price coming close to that Trend-Line ( once ) again….

( which I would be showing You on this technique below later )

In any trading game, we are ONLY interested with ” Predicting Future Market Movements “…

Because only by accurately doing so……we can then nail those valuable Pips & make Profits out of our trades……( again & again ! )

Agree on this too ?

BUT….

If You’re still unsure on - How to fully  make good use of such trend-line strategy yet ….

…OR simply NOT confident about it at all ( though You have been reading up about it )…

Then after reading this entire strategy today……You will truly benefit tremendously from it.

This is an exact forex strategy that I use to nail 80 Pips Profits on the USDCAD ….( while ONLY risking half the risk at 40 pips )

Ask any trader is this a good risk/reward ratio….

I am sure they would ” agree ” too….* smile *

Alright…let’s get started now ya.

—————————————————————————————————————

A Forex Strategy Combining ( Down ) TRend-Line …..& ” Bullish Rejection Zone ”

( Indeed a Very Profitable strategy with minimum risk….
BUT HIGH Rewards !  …And You can use on Any Pairs too !)
————————————————————————————————————–

The best way to understand & master a particular trading strategy is to learn it through Step-By-Step explanations……..right ?

Not really though !

I personally think that it is more beneficial to learn it in such a way that ..” You’re also SEEING…….what I am seeing in the market “…

…And more importantly - ” Before the actual Set-up is complete formed ! “

This is essential so that once the ” Proven Set-Up ” is completed in the market…You’re all ready to go in then..

If I just show You the ” Completed ” Set-Up…..instead of the ” before forming ” situation..

Then when You try to use this strategy in the forex market Yourself..

It could pose a challenge to You then…..as You’re NOT sure what to ” expect ” …

And so….. Your inconsistent confident level would be a major hindrance while You’re trying to mater this strategy ….

(…and would definitely prevent You from reaping the full benefits from this strategy.)

So just like all the previous forex strategies I shared with You guys..

This time round I am going to show You in such a manner :

=> From the ” before forming ” to …” ENtry “….to ” Taking-Profit “ & Winning the Trade at last !

Cool ?

Here we go….

—————————————————————————————————————–

This is the ” Exact Situation ” I saw on the USDCAD ( 4 hourly ) for a start :

—————————————————————————————————————–

Upon opening up the USDCAD ( 4 hourly ) chart, I saw the Price approaching the ” Top Limit ” of the Down Trend-Line once again…

When this happens…

I know there is a potentially good ” SHORTING Opportunity ” coming soon for this pair..

Like This :

So upon seeing this ” Price Approaching Trend-Line ” situation..

What should You do next in order to…….. prepare Yourself to look for some good ” hints ” from the market to confirm Your ” SHORTING ” bias then ?

Simple actually…

Just drop down to the ” Next Smaller ” time frame - Which is the 1 hourly for this case..

And then look for a ” Bullish Price Rejection Zone / Set-up “…

There are many such ” Rejection Zone / Set-Up ” You can take advantage of to confirm Your bias to Short / Sell actually..

But for the purpose of this strategy, I will just reveal the exact ” Rejection Zone ” that I use to confirm my bias.

I could not share ALL the ” rejection zone / set-ups ” merely with this short article today..

Which I think You can understand on that too …

In the days to come…..

…. I will share them one by one ( and explained them in the form of ” simple to understand strategy ” for You guys )  as I come across in my own trading …

( This is definitely one major benefit of being my valuable subscriber….! * smile * )

Alright….let’s continue with this strategy for now..

———————————————————————————————————————

So What Kind Of ” Rejection Zone / Set-Up ” Do I Look For….?

….Once Dropped Down To The 1 Hourly Time-Frame ?

——————————————————————————————————————–

Upon switching to the next smaller time frame ( which is the 1 hourly )….

…This is what I saw :

Remember this…

The reason why You are dropping down the 1 hourly time-frame is because You are ” looking for good hints ” to support Your SHORTING Bias…

Again………You are doing this due to the fact that the ” Price Is Approaching The ( Down ) Trend-Line ” on the 4 hourly time-frame …once again..

So without a ” Good Hint “…..

And Without  ” Considering The Risk Involved ” for this position…

Then You are NOT ready to enter the market to SHORT….

The key to be successful….AND  ” making nice consistent Profits ” from forex trading is to secure as many winning trades as possible..

That’s a logical and proven fact…

I am a stronge believer of Price Action Strategies…

And I rely the Price Actions in the market to confirm my bias and then guide me into a certain position I wish to trade..

Why the need to do that ?…….

Are You wondering on that too ?

Nothing complicated actually….but as long as one can extract as ” many hints / Confluence ” from the Price Actions in the market …

The success rate would be ( very ) high end of the day…

What matters most is ” WHAT ” should You look for  that is paramount to Your success….!!

So from this moment onwards……

…I will be explaining on ” WHAT ” am I looking ( or waiting ) for before I finally decide to commit into this postion to SHORT the USDCAD…

Let me show You the illustration again as I explain on some important details here to help You understand :

As You can see from the above illustration…

There is ” still some distance away the price is from the ( blue ) Trend-Line top limit “…

Moreover………there are also some ” Pin-Bars ” on that series of candlesticks reflecting
the price actions in the market .

What these current Pinbars and Price Actions mean is that  - There is a ” high likelihood ” that the price will CLIMB further..

Hence, I am reluctant to SHORT at the current Price level…..

…But choose to WAIT instead for ” Better Price & Desirable Price Actions ” in the market..

…..So did my ” Patience ” pays off ?

Yes….indeed !

The price actually climbs all the way to the level where the previous top is..

And then FAIL and ” Get Rejected ” there…..!!

( Proven by a few Bearish Candlesticks reflecting a high-probability of REJECTION at this level )

Here’s an illustration to show You :

As shown in the illustrations above..

The price climbs all the way and ” stalled ” upon touching the Trend-Line nicely…

But that is not always the case though…

Sometimes the price would pierce through……and then plunge down again…

Sometimes it would not even touch the trend-line ….and the next thing is that it PLUNGED down fiercely …

So the key here is to gather as ” many such hints ” from the market as possible..

That is a much better & ” Profitable ” way to trade the forex market…* smile *

So upon seeing that ” Nice REJECTION ” zone…

And knowing that the ” Risk ( Stop Loss ) ” needed is ONLY 40 Pips..

I know this is the ” set-up ” I wanted..

NOTE : At the same time, I already knew that the POTENTIAL REWARDS ( Pips ) I can aim for with such set-up in the market.  ( which I would be showing You later below )

The Potential Rewards ( after calculation ) is about 150 Pips for this set-up…

BUT….I am just aiming for a conservative 80 Pips for this trade…..( my style ! * smile * )

Good enough as the risk involve is ONLY 40 PIps..

Hence giving me a Reward/ Risk ratio of 2 : 1….

TWICE that is !!

Before I get into the trade summary…

Let me show You ( with illustrations ) on how I calculated the Potential Rewards You can aim for ( that’s how I derive the 80 Pips Take-Profit Target ) :

This Step on ” Calculating Potential Rewards ” was already done so BEFORE I get into my SHORT ENTRY..

It is part of the trading ( or battle ) plan so that the Reward / Risk ratio could be determined way before hand…

And if it is worth it….I will ” wait ” and continue monitor this trade closely as the set-ups unfold in the market…

So as can be seen from the illustrations above…

The Potential Rewards is calculated to be 150 Pips..

And I am just aiming for 80 Pips out of these 150…

Is it consider ” realistic ” here ?

…..VERY ! * smile *

As I intend to trade this position for short-term ( intra-day ) profits..

Hence 80 Pips is already more than enough for me.

Well…perhaps some of You guys might be wondering about this question too :

” Hey Aaron….why don’t You aim for more pips in the range of 150 - 200 pips ?….

Since this is a Down-Trendline…..Why don’t ride the Trend further for more Pip ? “

My Answer for You guys :

Yes…..aiming for more profits in the range of 150 - 200 pips is definitely good….

Especially when this is a ( Down ) Trend-Line….which carries a high probability of Strong Down-Trend..

HOWEVER…..

The reason why I am just aiming for a Short Trem ( Intra-day ) profits of just 80 Pips is solely back-up by some strong ” logical facts ” here though….here it is  :

…See on the illustrations above, You can also see a really STRONG SUPPORT Line for
this USDCAD pair right ?

As long as this Support is NOT broken…..

I will ” respect ” it very much as it is literally NOT wise to presume that it would be broken
for sure…

( One of my winning rule is ” Never Presume ” anything in the market…..remember ? *smile *)

BUT once that Support is BROKEN…

Then YES….I would be aiming for BIGGER Profits in the range of 150 - 200 pips….
OR EVEN MORE !!

Now You know why I am aiming for just 80 Pips for this trade……

Being conservative and respect the support line is essential here.

Trading just 1 standard lot and nailing 80 Pips is already USD$800 profits….

What if You can do it confidently 4 -5 times a month ?

$3,200 - $4,000 just trading 1 standard lot……?

Not bad I am sure…

And if it is a ” High Probability Set-Up & Proven Strategy ” You’re using…

Then it would make the entire trading process very enjoyable too - WITHOUT You having to worry and feeling fearful …which happen to most ..

Right !

——————————————————————–

Here’s the trade details for this position :

——————————————————————–

SHORT Entry : 0.99595

Stop - Loss : 0.99995 ( 40 Pips Risk )

Take - Profit : 0.98795 ( 80 Pips Rewards )

So How Did This Trade Turns Out Eventually ?

Here’s the Answer for You :

This trade intially goes ” slightly ” in my flavor….

But shortly after that…it starts climbing up again and reaching as high as the previous TOP…

Just 10 pips more and it would hit my Stop-Loss for this trade…

( as You can see too above )

Hmmm……Sometimes a small difference of 5 - 10 pips can literally make or break a trade …

Imagine I am not giving any allowance ( extra pips ) for my Stop-Loss…

Then it would got hit and there goes another LOSING trade….
( which could be a WINNING one eventually )…

Hence, whenever I decide on a Stop-Loss , I will make sure I give it an extra 10 - 15 pips.…( especially for such TIGHT Stop-Loss placement )

—————————————————————————————————————————–

….A while back, I have written a forex trading tip on ” Strategic Stop-Loss Placement - In Order To Avoid Getting Hit Unneccessary “ for my fellow readers. If You are still NOT confident about Stop-Loss Placement yet….. ( and have not read on that tip I wrote )…

=> You can still read the entire Stop-Loss Technique here

( ….Please do it AFTER You read through this strategy as it is NOT good to disrupt the FLOW when learning a new forex strategy ! * smile * )
——————————————————————————————————————————

Alright….back to the last stage of the trade progress now..

This SHORTING trade last for slightly more than a day before my Take - Profit target
finally hit….

And if You notice too..

The ” BEARISH ” action only starts after the 3rd Tops.

Which is also known as a ” Triple Tops ” formation in the market…

Note how ” BEARISH ( Long & Full ) ” those candlesticks are after the 3rd Top…

Price actually PLUNGED down aggressively with no break/retracement at all..

What does this shows ?

It shows that there are big ( volume of ) funds pouring into the market to SHORT this pair as well…at that price point.

Where did those BIG Funds coming from ?

Obviously from the major banks, institutions, hedge funds….and combined power of both Professional & Retail traders …..right !

…..Those BIG Players are watching such Trend-Line too !

So it definitely pays to understand & eventually master this forex strategy on Trend-Line trading..

Combining with ” Price Actions in the market ” to seek for HIGH PROBABILIY REJECTION Set-up……

…The Winning % can be really astounding most of the time !  * smile *

And now You know…..

I would consider the above strategy a very simple one in fact..

( But ( very ) Profitable at the same time ….)

The key is to know ” what to look ” for when a price hit a Trend-Line LIMIT - In order to support Your bias to Short/ Buy..

After that…weight the Reward/Risk ratio to see if it is feasible to trade it..

That’s about it.

The beauty of such strategy is that You can use it on almost ANY currency pairs available on Your trading platform..

Why ?

Because it has been proven to work on them !

NO Technical Indicators needed….

NO Complicated Trading Systems needed…

NO Need To Read Tedious Financial Reports / News..

Isn’t it ( really )Simple after all…?  LOL

If You are not confident yet……

Do not give up..

Just learn bit by bit progressively…

Soon You can also get the ” full PICTURE ” and finally ” GET IT ” too..

——————————————————————————————————————————

Here’s the earnings screen-shot with ” Entry, Stop-Loss & Take - Profit ” to share :

( 80 PIps from this trade = $2,435.04 Profits )
—————————————————————————————————————————–

A Profits amount of $2,435 + might not be “  alot ” to some traders…( whom are trading a much bigger lots size than me )

BUT………when these small profits in the range of $2,435+ could be achieved consistently ( again and again )…..3….4…..5….or even 10 times in a month…

That would already amount to more than $10,000 - $20,000 profits from forex trading…

That also explains why I always advise those traders starting out …… to start small and build up their account size progressively by winning ” Realistically Small Profits ” but consistently…….

( Training Yourself to aim for 50 - 100 pips is a good target for short-term trading as it is within the daily average range for most currency pairs  )

This would enhance Your trading skills and confidence in no time….. as You guys trade more and more in the LIVE market..

The Big ” V -Day ” ( Valentine ) is round the corner as I am done with this winning trade on the USDCAD..

Grabbing a nice Profits of $2,435+ from this trade………

And the BIG ‘ V ” day near…

Definitely this amount would come handy now…..right !

Especially when my wife has already hinted me about that particular ” CHANNEL ” handbag she has been eyeing all these while !!!

Good time to pamper our love ones on this special occasion…

Am sure You would agree on that too ….* smile *

Making Nice Profits and income from the forex market feels good…

But it would be even ” BETTER ” if we can use the money to make our love ones HAPPY at the same time……..agree too ?

” Smiling with a wide GRIN on my face now…. “….

Alright….so much for this profitable forex strategy on :

“…( Down ) TRend -Line Combining With A Proven Bullish REJECTION Zone “…

If need to….do make sure You read it again and fully understand it ya…

This is to ensure that You would NOT get too confused while trying on a DEMO account after that…

Happy practising and trading in the meantime..

I shall send You more forex trading strategies & tips in the days to come..

Thank You for reading this far too.  * smile *

To Your ( absolute ) FOREX SUCCESS,
- Aaron Tan ( your trading friend )

Deciding on a Correct Stop-Loss for your trades can be a very tough task for most….

Especially the newbies and those whom are struggling with their trades.

Setting too tight a Stop-Loss….your trades always get Stop-out unnecessary

….( although you’re right about the trend in the first place )
On the other hand…..setting too BIG a Stop-Loss, you could not achieve a good risk/reward ratio…

….Which result in deficit & yet another losing month for your trading account .

( capital getting lesser & lesser ….month after month )

Sometimes you even thought of  just ” Heck-Care ” about the Stop-Loss and just trade WITHOUT one…

But on the other hand, you’re feeling very fearful and could not trade with a peaceful mind…

What can be done about this problem in your forex trading then ?

Any solution in the first place ?

Of course there is !

And later,  I am going to share ” my way ” of placing a Stop-Loss Strategically for my trades….

- Which has been proven very effective in Preventing Stop-Loss getting hit unnecessary.

In the event that it does get hit, it means I am lucky and protected by the Stop-Loss.

Hence, saving the WRONG trade from draining my account and wiping my capital with the DEFICIT.

Many fellow readers have wrote in to me asking …

…..or rather seeking solution to this issue on Stop Loss setting .

So I actually spent about 3 hours by the pool side typing this article to share with my readers.

( while watching my baby and wife playing in the baby pool …* smile * )

Later I will be sharing my proven technique on How to place a Stop-Loss strategically for forex trading.

It is not a 100% winning kind of technique of course..

Nothing is guarantee in trading game ….and you and me already know that.

However, by understanding and then executing this proven technique on placing Stop-Loss.

I am confident that anyone can avoid seeing their Stop-Loss getting hit UNNECESSARY ……
again and again….

Why is this technique so effective then….Aaron  ?

The reason is very simple here.

Because it capitalised on the ” natural market behaviour ” .

When I am still learning as a newbie, I also face such problem of getting Stop-Loss hit ….again and again…” UNNECCESSARILY ” as well …

And it is by ” finally ” understanding this technique on how to place stop-loss stratetigically…

I then able to see tremendous improvement for ALL my trades…….and my account started to grow exponentially after.

Getting 35-50 pips Stop Loss hit once or twice is not a big issue …as long as good money management
is being used.

HOWEVER….

What if we are talking about 8 or even 10 trades getting hit again….and again…

That’s already over a FEW HUNDRED Pips down the drain ….right !

And only to see the trend goes your way…

In your heart, you would never fail to think about this :

“….IF ONLY I SET MY STOP LOSS 10 PIPS MORE ! “…

You would not get HIT then because the trade rebound and go at least 120 pips the direction
YOU WANT.

The above is a very common scenario (  problem  ) most failing struggling traders face in their
trading indeed…

I knew it….because I have been there once too….* not afraid to confess ! *

But that’s in the past then.

Now with this technique, I am getting very good results.

Because I know the with the ” Unique way ” I set my Stop-Loss, it is PROTECTING my money !

Alright….let me share this exact techique on :

How To Set Stop-Loss STRATEGICALLY…. With You next

Read the entire post for details.

There are many different scenarios that can happen in the forex market - That’s an undeniable fact.

So I can’t possibly show examples for ALL - That’s also understandable right .

But , I will show 3 most common ones.

These 3 scenarios are good for both a Sideway as well as a Trending market.

Hence, I am sure you guys would have no problem executing it for your trades too.

Alright..let’s go !

————————————————————————————————————-

The Main OBJECTIVE Of A Stop-Loss In Your Forex Trades

————————————————————————————————————

Just as the name implies…

It is a Stop- Loss !

…. That means if a price can BREACH a certain price level, you would want to EXIT at that point.

If  you go LONG/BUY previously..

Then the Stop Loss would ” SELL ” for you at a certain price point you pre-set…

Nothing more complicated than that.

So to truly fulfill the main purpose of a Stop- Loss….

….. and reap the maximum benefits from it..

=> You Should Only Place A Stop-Loss At A Point That The Price Should Not Breach ! “

And if it gets breached, you would want to get out because there is a high tendency that you’re
WRONG about the direction.

Simple and very very logical right ?

Alright….next , let me show you 3 different scenarios on what I mean by……
” Setting Stop Loss Correctly & Strategically ! “..

( …….And that is in a Crtical ZONE that the price should NOT be reaching ! )

Let’s get started :

” UNIQUE ” Way Of  Setting A Stop-Loss …

( 3 common scenerios for You …)

————————————————————————————————————————-

Scenario 1 :  Place The Stop- Loss After A Price Pull-Back/ Retracement

———————————————————————————————————————–

When a trend starts to develop , it would Pullback /  Retrace at some point due to profit taking.

Even if it is just a short term trend in the market, a Pullback/ Retracement would also occur.

( due to profit taking ….)

However, in order to secure high winning trades, I would normally go for the very ” FIRST ”
Pullback /  Retracement though.

As it is more reliable and there are MORE Potential for the price to go further.

Here’s an illustrations to show what I mean :

Placing the Stop Loss slightly below the Price Pullback is indeed a very good strategic location.

That’s because a Price Pullback is a ” turning point “  for any trend to resume.

Even if it is NOT a strong trend, but at least we know that the price is going to move quite a distance in ” That ” direction.

SO….you and me can go in and grab some pips ( profits ) out of this set-up.

And because it is a Pullback that we are taking advantage of here….

Hence the ” Risk/ Stop-Loss value ” we need to use can be minimized too.

Best of both world indeed.

Another technique that I like to use to further confirm that it is a more reliable Pullback is to spot for congruence such as the 61.8% Fibonacci that coincide with the pullback.

If you spot a pullback that you would like to use as an entry point, do make sure that that pullback at least coincides with the 50% or 61.8% fibo level as well.

This would give you further confirmation and of course make it a more profitable set-up to go in.

Just bear in mind that a Price Pulllback is simply a ” turning point ” for the trend to resume in the previous direction.

So basically you are taking advantage of the ” low price ” to get in to BUY again.

( The conventional way of  ” Buy Low…Sell High ” applies )

So much for that….

Next, I am going to talk about a Symmetry Triangle BREAKOUT.

——————————————————————————————————

Symmetry Triangle Breakout

—————————————————————————————————-

If you have been trading currency pairs such as the GBP/USD or GBP/JPY..

Then you would also agree that they are very prone to such Symmetry Triangle Breakout too.

Because the LONDON financial market is the biggest around the world and most of the time during the first 2 hours of London Open…

The volatility is extremely high and having spotted such Symmetry Triangle Breakout set-up..

It is a strong hint that both the interests and volumes are very high.

Meaning if it BREAKOUT is to the up-side, then the buying interests and volumes are very high.

So we can go in and grab some nice pips from this volatility.

Another scenario which is very prone to such Symmetry Triangle Breakout is during a major news announcement.

Especially those which carries more weight such as the NFP or Interests Rate Announcement.

So how do You place the Stop - Loss for such Symmetry Triangle Breakout ?

Let me show You the strategy next :

Just like the old saying of  :

“…There would always be extreme peaceful-ness before a catastrophic STORM ! “

This Symmetry Triangle BREAKOUT is somehow the same..

Of course with the latter, it is not a natural disaster though.

But if one is not using proper risk control, he/she might lose a lot of money.

In the above illustration, the symmetry triangle breakout is happening on the GBPUSD

A very volatile pair especially during the first 2 hours of the London Open.

That BREAKOUT candle for this example also happened on the market open as well at 7am GMT.

A Stop- Loss placed just below the level ” before ” the breakout is a good strategic place indeed.

Because with such BREAKOUT, the interests & volume are very extremely high.

So if the price can reverse and breach the level before it breakouts, then it is better for you to EXIT.

That’s the principle governing this set-up.

Now you know. * smile *

Alright, next I will be talking about the 3rd scenario which is also the last one I am sharing here.

And it is the Morning Star candlestick formation !

In the above 2 examples, I am talking about set-ups for an uptrend if you notice.

So there must be a point where the price would Turn Down & Reverse.

This is the nature of any financial market indeed.

That’s why I choose to include a candlestick formation for a uptrend reversal - The Morning STAR Candlestick Formation that is.

——————————————————————————————————

Morning Star Candlestick Formation

—————————————————————————————————–

If you have been trading the forex market  for sometime now..

Then the ” reason ” behind the formation of such candlestick might not be new to you anymore.

But for the sake of other newbies, I will just explain briefly here though.

Bear with me for a while ya.

This Morning Star candlestick formation is actually an ” Uptrend Reversal ” pattern.

It is mostly spotted after an up-trend or rather…..after the price climbed for some distance.

If you refer to the picture above, you would notice a DOJI right at the top of the move…

Which basically implies there are indecisiveness in the market.

And soon after, if there’s a Bearish Candle Closed that follows…

Then it can be considered a Morning Star formation.

When that happens, it is a good opportunity to go into the market for some SELLING of course.

The beauty is that it is very reliable and one of the easiest pattern to spot when it happens in the market !

Here’s how to place the Stop-Loss having spotted this formation :

Very direct on this formation as you can see above too.

Upon spotted the Morning Star Formation , just place the Stop Loss above that DOJI.

It is another very strategic location where the price is NOT likely to breach at all.

Why so ?

Because previously at that level, the buyers are not showing any BUYING interests anymore..

Instead, shortly after that….the sellers came into the market and start dominating.

In any trading game, as long as you are following the MAJORITY….

You can ride on the wave and grab some pips ( profits ) and make your account fatter too.

Important points to note here is that :

1)  A morning star formation spotted on a bigger time frames ( such as 4hour or daily ) would be more reliable than the smaller time frames ( such as 5 / 15 minutes )

2)  As this is a ” Up-trend Reversal ” candlestick formation, it means you would be trading the counter-trend too most of the time.

So to increase your odds of winning with this Morning Star set-up, try to combined other congruence such as a Double Tops/ Bottoms  would definitely be good to increase winning accuracy.

3)  Also, if the BEARISH CANDLE BREAKOUT is too huge - Meaning the price has already moved more than 120 pips perhaps, then you might want to wait for the price to retrace/pullback abit first before deciding to commit.

This is to prevent You from using too HUGE a Stop-Loss for that trade.

Achieving a Good Risk/Reward ratio is still paramount here no matter which set-ups you are going for.

Alright, with this, I shall conclude this article then.

Although this technique of ” Setting Stop-Loss “  is not 100% accurate..

But I can confidently tell you that if You can follow the way I place a Stop-Loss as explained above…

Your trading accuracy could also be increased tremendously - Especially when you do not have to worry about getting the stop-loss hit….again and again.

Frustrated to experience that ….I know.

I used to experience that too during my beginner’s days….but once I understand the ” objective ” of placing a stop loss..

Things took a drastic change - For the BETTER of course ! * smile *

Most of the time, these set-ups would not be so ” perfect looking ” and it makes it very hard for you guys to identify is it the set-up / formation you thought it is..

When that happens ?

How…?

Well….just step aside and skip that pair then.

They are more than 15 pairs in your trading platform for you to grab profits from..

So why bother taking risk when it is affecting your judgement and trading confidence ……right ?

Thanks for reading this far.

I hope by now you have understand how to truly place a Stop Loss ” strategically ” for all your trades in the days to come…..

…..and end those days of fearful,frustration ( due to seeing your stop loss hit…again and again ) once and for all !

I shall pen off for now.

Feel free to read other forex trading strategies in my blog ya.