STRATEGY/PLAN

IMPULSE – CORRECTION – IMPULSE

Entry

Daily/4H/1H/30mins timeframe (select only 1)

[1] Price trailed by 30SMA – ensure strength of first impulse wave

[2] Pullback between 30SMA and 150SMA

[3] Corrective structure formation with 2×2 touches

[4] Stop order at the break of corrective structure with stop loss after swing L/H

[4] Stop order after price bounce off area of value with volatility stop

(✓)

Additional confluences: Support or Resistance, ADX, Linear Trend Lines, Fibonacci Retracement, ATR and Elliot Waves.

1% capital risked for potentially xxR

Open: xx | Stop loss: xx (points) | Take Profit: xx (points)

Remarks:

Management

Keying in the trade, use volatility stop placed under/above an established swing L/H or moving average cross or estimating volatility using ATR.

Real stop loss placed under/above the anticipated swing L/H using 150SMA as a guide.

Take profit calculated using the length of the prior impulse wave rounded off to next nearest swing point/key level.

Once entry triggered and break out, shift automated volatility stop to real stop position.

At 50% of 2nd impulse or a swing L/H established, shift stop to break even.

At about 80% of 2nd impulse, shift stop to the 50% mark or below/above swing L/H.

If price breaks and closes under/above the 30SMA, tighten stop loss and prepare for manual exit.

Exit

[1] Initial stop loss

[2] Trailing stop, as mentioned under management

[3] Manual exit due to change of momentum and break of market structure

[4] Take profit


TRIANGLE

Entry

Daily/4H/1H/30mins timeframe (select only 1)

[1] Clear market structure of the triangle with 5 touches

[2] Identify key levels for break out

[3] Stop order at the break of identified key levels in the direction of prior impulse, opposite direction for a reversal or both

(✓)

Additional confluences: Support or Resistance where the triangle is placed, longer term trend, conditions on higher timeframe or Bollinger Bands.

1% capital risked for potentially xxR

Open: xx | Stop loss: xx (points) | Take Profit: xx (points)

Remarks:

Management

At entry, stop loss placed under/above a prominent key level that made up the triangle. Depends on the market structure and size of triangle.

Take profit at the next nearest key level on the same timeframe.

After break out or next swing L/H established, shift stop to break even.

At 80% of take profit, shift stop to 50% mark or below/above swing L/H.

If price breaks and closes under/above the 30SMA, tighten stop loss and prepare for manual exit.

Exit

[1] Initial stop loss

[2] Trailing stop, as mentioned under management

[3] Manual exit due to change of momentum and break of market structure

[4] Take profit


HTF SWING

Entry

Weekly/Daily/4H/1H/30mins timeframes (select 2)

[1] Ensure that price is range bound/strongly respecting S/R on the higher timeframe

[2] Go down to the lower timeframe and identify the accumulation/distribution/swing point

[3] Plot out ST-TL and LT-TL confirmed by the 30SMA and 150SMA. As price is range bound, will be looking for the existing ST trend to reverse.

[4] Price breaks and closes the ST-TL and 30SMA

[5] Stop order at the break of the accumulation/distribution structure

(✓)

Additional confluences: Head & Shoulders, Support/Resistance on the lower timeframe, Fibonacci Retracement, Candlestick Patterns on the higher timeframe

1% capital risked for potentially xxR

Open: xx | Stop loss: xx (points) | Take Profit: xx (points)

Remarks:

Management

At entry, stop loss placed under/above the lowest/highest point of the support or resistance on the higher timeframe.

Take profit placed before the support or resistance that makes up the range.

At 50% of the range, LT-TL or 150SMA – shift stop to breakeven.

At 80% of the range, shift stop to 50% mark or below/above swing L/H.

If price breaks and closes past the 30SMA on HTF or 150SMA on LTF, tighten stop loss and prepare for manual exit.

Exit

[1] Initial stop loss

[2] Trailing stop, as mentioned under management

[3] Manual exit due to change of momentum and break of market structure

[4] Take profit


FALLING/RISING WEDGE REVERSAL

Entry

Daily/4H/1H/30mins timeframe (select only 1)

[1] Plot out linear resisting and supporting trend lines that form the wedge

[2] Clear market structure of the wedge with 5 touches

[3] Identify squeeze – low volatility

[4] Stop order for a break out

(✓)

Additional confluence: Support/Resistance on higher timeframe, Candlestick Patterns or Elliot Waves

1% capital risked for potentially xxR

Open: xx | Stop loss: xx (points) | Take Profit: xx (points)

Remarks:

Management

At entry, stop loss placed under/above the swing point which is anticipated to be the lowest/highest.

Take profit placed at the next key support or resistance level.

If breakout from the wedge, shift stop to breakeven.

At 80% of take profit, shift stop to 50% mark or below/above swing L/H.

If price breaks and closes under/above the 30SMA, tighten stop loss and prepare for manual exit.

Exit

[1] Initial stop loss

[2] Trailing stop, as mentioned under management

[3] Manual exit due to change of momentum and break of market structure

[4] Take profit


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Risk Management & Rules

Trades with stop according to market structure must be allocated risk of 1% consistently.

2% risk allowed for automated volatility stop. However, look to close at 1% real stop if market makes a decisive move in the unfavoured direction.

Due to the price discrepancy between brokers on TradingView and CMC Markets, key in the trade based on prices shown on the CMC chart.

In the event of a 20% drawdown, 1% risk will be based on the new existing capital. Hence, the account can run for another hundred trades.

R-performance must be potentially more than 1.5.

No scaling in, not required for swing trading.

Same market, different set-up, different timeframe, different trade – possible.

Trades should essentially be managed on the entry timeframe itself.

For trades entered on the daily timeframe, the 4H could be used for a more detailed view of the market structure and for tighter stop loss placement. use 100(?) points as a gauge, collect stats to find out the balance between tightness and volatility

Review closed trades 10 at a time.


Psychology

Throw away the trend following approach, doesn’t suit your style. At least not for now.

Don’t be greedy.

The aim is to identify low volatility areas and enter before the high tension accumulated results in massive price movement.

You will be missing many moves. Doesn’t matter, there’s always another set-up.

You will be wicked out from time to time. It’s all part of trading.

Accept losses.

Hindsight is a parasite. Ignore it and move on. Easier said than done, however.

Exits define your edge, do not only look for the premium entry. Look to plan out the whole process.

Not only about the risk to reward ratio, probability of winning also plays a huge part.

Remember, a high potential R performance means a lower probability of success.

The whole system with all the departments of a trade has to function in synchronisation.

Targeting a near 50% win rate with potential-R averaging from 1.5 to 3. You will have to find the balance.

Be patient enough and trust your analysis.

You want to find your statistical edge. There’s already an idea, prove it.

The edge will play out in the long-run and you want to make money in the long-run, over a series of trades.

Be a robot.

Get to 100 trades then use statistical data analysis. 

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