I’m not sure when you are going to read this article, but I will like to show you how I pick my trades for the day. I believe that doing this will give you an idea of how you should trade. What you will notice is that I do not overtrade and that I am looking for either a 1-day-long trade or even a weekly trade. All of my trades are set up to be directional day trades or swing trades that can earn a ton of forex pips. Either way, my trades are high-probability trades.
So it is 9:43 AM on Monday, and the market has opened for the US market. I am looking for plays on the EUR/USD, USD/JPY and other major currency crosses. Since it is Monday, it is hard to find continuation plays. I call a continuation play as one where you can take the forex price action from the following day and choose direction based on engulfing candle chart patterns and gap-up. Since I do not have such data available to me, I will look for convergence over 5 different charts: The 5 minute chart is used for seeing what the market is doing now, the 15 minute is used to verify direction, the 1 hours chart is used to see what the market has done during the Euro session, and the 4 hours is used as a sort of medium term verifier.
When all of these charts line up in direction, I will use market sentiment to choose a directional trade. With this method, you will not see many trades, but the ones that you do see are high-probability trades that are likely to go in your favour. As traders, this is all we can hope for when trading.
This is sort of a meta trading system that relieves stress and reduces stress. I sometimes only make one directional trade a day and leave the computer. I have a stop loss set so that if the trade turns on me, I will not lose too much money. My money management also has it so that I only trade a set amount of units per trade, and I adjust this by the amount of money that is in my account. I always trade 3% of my current account balance, and I never try to trade more if I lose.
So, tomorrow, when you take a look at the forex market in the morning, try to look for directional convergence across several charts. Make a trade in the direction of the price, set a stop loss, and let the market do its thing. Trading is actually this easy, and it doesn’t need to be stressful. This is a trading system that I use almost every day. I also do more long-term trading and short-term trading as well. This is a method I use as my main technique. Give it a shot, and you will see that it will work for you.