Strategies

My trading is mainly based on the trend following philosophy, nothing new. Trend following has been used for decades by many successful traders like Jesse Livermore, Bill Dunn, J.W Henry and EdSeykota just to name a few. I don’t use fundamentals at all, all my trading is based on price action. Traded price can’t  be fixed, but fundamental data can be doctored. I stopped trying to predict the market direction and i now only react to the markets movement. With trend following, there are more losers than winners, but the winners are so huge that they cover for all the small losses. My price action trading has taken me years of watching the markets, so this couldn’t be taught overnight. So I have a mechanical strategy that is close to my price action trend following method, and I will share it with you.
Strategy
Hourly chart, Bollinger bands (20)Buy
When bullish bar closes above BB (trigger bar), buy order is place 10 pips above high
SL is placed 10 pips below the 2nd recent HL, trade in multiple positions (6 lots)
Targets – High minus low (trigger bar)x 1.5 (1st target)
1st target x 2 = 2nd target
2nd target x 2 = 3rd target
2nd target x3.5 = 4th target
4th target x 2 = 5th target
6 th target is left to run until reversal.

Vice versa for sell

This is a trend following strategy, so we are buying in an uptrend and selling in a downtrend. Avoid trading in a rangy sideways market, wait for price to breakout then you start looking for trades. This strategy is taking advantage of the trend and also trapped traders…e.g when mkt is trending up, a pullback that has a bearish bar which closes below the BB will trigger a buy, thus taking advantage of trapped sellers.

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Responses

  1. I like your style of trading, keep up the good work.

  2. Thanks Bob…hope you learn something from the blog, thats the main reason we started the blog. If you have any questions do no hesitate to ask…we are all in this market together, and the market has no messy on us.

  3. Hi Joe,

    Your blog really inspired me, thanks for the sharing.

    I am wondering how long you spend on the analysis daily ?

    • Thanks Cladius, hope you find something helpful to your trading.

      Trading and looking at the markets is a passion for me, so I spend most of the day just analysing different markets…even the ones I dont trade. Its more of a hobby than a job.

  4. Hi Joe!
    I have one silly question. For 4hour chart how many pips from the trigger bar may I set my BuyStop or SellStop orders? Again 10pips or maybe 40pips?
    Regards!

    • I personally set my buystop and sell stop at 10 pips away rounded off to the next tenth…example if high of bar is 1.5012, I add 10 pips, makes it 1.5022, round off to the next tenth 1.5030 (thats my buystop). When selling, lets say the low of the bar is 1.5015, take away 10 = 1.5005, round it down to the next whole number = 1.5000. Hope i explained it well


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