“How To Build The Income And Security You Want By Taking What You’re Already Doing… And Building A Real Trading Business Around It”
One of the most common questions we get asked at Forex Trading-Pips is what strategy should I trade? Do you trade trend following, or counter trend? Do you use stops, or don’t you? If so where do you place them? Do you use profit taking targets, or should profits be left to run? Is it best to trade just one market, or a portfolio of markets?
The biggest obstacle facing traders today is that so many strategies offered in the thousands of books, seminars, courses, and more recently across the internet don’t work, never have worked and never will work. They are designed with the sole purpose of helping one person and one person only: the system seller.
The most important thing to understand is that markets are not ‘static’. Markets are constantly evolving and changing, and while history often repeats it’s not a perfect match. Arriving at solutions for future performance is no small task: just because trend following strategies performed well for the past 40+ years doesn’t guarantee that they will continue to do so in the future, the same for other systems and strategies.
Successful trading is about creating a sustainable trading advantage which adapts to market change as markets evolve.
No matter what the environment, the market is always in one of the following conditions:
- Trending up
- Trending down
- Trading sideways
Then there are sub components to these conditions which are a function of market volatility: Trend volatility, counter trend retracements (volatility of volatility), sideways range volatility.
A fully adaptive trading program must be able to profit from all three of these conditions and variants. Most traders are exposing themselves to unnecessary levels of risk by utilizing just one strategy through all market conditions: they may make money for a while, but then they blow out when the market changes.
How the big money is made trading:
- Multi Time-Frame
- Multi System
- Multi Market
Two of the most important things to understand are that
1. ‘Trend’ is the basis of some of the biggest profits ever made in the markets. Trend is the force that takes market prices higher or lower.
2. Profit is a function of time, meaning that the longer your holding period, the greater your chances of catching an outsized move in the markets.
These phenomenon explain why 99% of day traders lose money in the markets: once commission and slippage are factored in, most of these traders don’t stand a chance.
Successful trading is about losing the short time mindset of making money immediately, winning every trade, winning every day… this losing mindset lines the pockets of successful traders focused on the big picture. Successful trading is all about winning the war, even if some individual battles may be lost.
The point is no matter how successful you are, you will have some losing trades and the key takeaway is that losses must be controlled through position sizing: maintaining trading losses to a small percentage of your trading account so that no individual loss ever has the power to take you out.
True wealth is generated by trading consistently day in day out, executing trades with extreme precision and discipline, month after month, year after year… this is how true wealth is created in the markets.
Remember: without a proven strategy that works you are part of the 90% of traders who lose money.
The Big Money is in the Big Move!
At Forex Trading-Pips we trade for the big move. We want the biggest bang for our buck when it comes to taking risk and we don’t ever want slippage, commission and electronic price manipulators interfering with our Trading Success.
By employing smaller sized positions across multi systems and multi markets you are able to ride out market volatility for the duration of the move while leveraged players are getting wiped out of their positions using tight stop orders. This can be summarized as ‘betting small to win big’.
The biggest problem for most traders is that markets are not always trending and those focused on just one time frame get ‘trapped’ waiting for the next big move to pay off trading losses. The solution to this problem is ‘multi time frame’.
Market price action is fractal, a market that may be be trending up on a daily time frame could be trending down on a 30 minute chart. By employing multi time frame systems we can profit from multiple trends in the same market which produces lower total volatility on our account equity. The more uncorrelated systems we add, the smoother our account equity.
There are 3 simple components to a winning strategy in the Forex markets and these components are the subject of our ‘ Forex Traders Manifesto, The 3 Pillars to Success’. Watch your inbox for further details over the next few days.
Forex Trading-Pips have helped hundreds of struggling traders find focus and to make profits in the global currency markets… so they can trade with confidence, build a sustainable trading business… that brings them the income, security, freedom and peace of mind they’ve been working so hard to achieve.