Strategy Playbook

New comment
 
I was wondering if anyone out there could make suggestions for a strategy playbook that I could trade with. 

Currently, I trade using supply and demand techniques. I find a probable zone, I like there to be a gap in the impulsive move and a break of structure, I only trade with the trend and so if there is a change of character I do not take the setup. This has been good for finding 1:1 trades, but I seldom find anything higher than that. 

I also use a break and retest technique where I draw higher timeframe support and resistance zones, then I draw lower timeframe minor support and resistance zones, then wait for a break and retest of these and trade until the next zone. I have had less success with this strategy, most of the time my stoploss is very large because I have been stopped out many times when there was a retest that kept coming back into the range. 

I would like to continue to work on these strategies until I perfect them, is there another strategy someone can suggest I add to my playbook that has a high success rate and achieves high risk to reward. I would like to be trading with 3-4 setups in my playbook. 

Thank you!
 
It's commendable that you approach your trading systematically and actively seek to expand and enhance your playbook. Here are a couple of additional strategies to consider incorporating into your trading arsenal:

### 1. **Trendline Breaks and Retests:**
   - Identify a clear trend by connecting swing lows in an uptrend or swing highs in a downtrend.
   - Look for a break of the trendline, indicating a potential reversal or continuation.
   - Wait for a retest of the trendline to enter the trade, ensuring the break is valid.

### 2. **Fibonacci Retracement and Extension Levels:**
   - Utilize Fibonacci retracement levels to identify potential reversal zones within a trend.
   - Combine Fibonacci extension levels with existing impulsive moves to project potential future price targets.
   - Seek confluence with other technical analysis tools for confirmation.

### 3. **Candlestick Patterns:**
   - Incorporate candlestick patterns, such as engulfing patterns, doji, or hammer patterns, to identify potential reversals or continuations.
   - Combine candlestick patterns with other technical analysis factors for confirmation.

### 4. **Divergence Trading:**
   - Use divergence between price and technical indicators (e.g., RSI, MACD) to identify potential trend reversals.
   - Look for divergence on multiple timeframes for stronger signals.

### 5. **Range Trading:**
   - Identify clear support and resistance levels within a ranging market.
   - Buy near support and sell near resistance, targeting the opposite boundary of the range.

### 6. **Moving Average Crossovers:**
   - Employ moving average crossovers (e.g., 50-day and 200-day) to identify changes in trend direction.
   - Look for crossovers as potential entry or exit signals.

### 7. **News Trading:**
   - Stay informed about economic events and news that can impact the market.
   - Trade based on the market's reaction to significant news releases.

### Tips for Refining Your Strategies:
   - Backtest your strategies extensively using historical data to evaluate their performance.
   - Maintain a trading journal to record and analyze each trade, identifying strengths and weaknesses.
   - Continuously adapt and refine your strategies based on market conditions and personal experiences.

Remember, there is no one-size-fits-all strategy, and success in trading often comes from a combination of techniques tailored to your risk tolerance, time commitment, and psychological profile. Additionally, risk management is crucial, so make sure to set and adhere to proper stop-loss levels.
 
Soraya Bahlekeh #:
It's commendable that you approach your trading systematically and actively seek to expand and enhance your playbook. Here are a couple of additional strategies to consider incorporating into your trading arsenal:

### 1. **Trendline Breaks and Retests:**
   - Identify a clear trend by connecting swing lows in an uptrend or swing highs in a downtrend.
   - Look for a break of the trendline, indicating a potential reversal or continuation.
   - Wait for a retest of the trendline to enter the trade, ensuring the break is valid.

### 2. **Fibonacci Retracement and Extension Levels:**
   - Utilize Fibonacci retracement levels to identify potential reversal zones within a trend.
   - Combine Fibonacci extension levels with existing impulsive moves to project potential future price targets.
   - Seek confluence with other technical analysis tools for confirmation.

### 3. **Candlestick Patterns:**
   - Incorporate candlestick patterns, such as engulfing patterns, doji, or hammer patterns, to identify potential reversals or continuations.
   - Combine candlestick patterns with other technical analysis factors for confirmation.

### 4. **Divergence Trading:**
   - Use divergence between price and technical indicators (e.g., RSI, MACD) to identify potential trend reversals.
   - Look for divergence on multiple timeframes for stronger signals.

### 5. **Range Trading:**
   - Identify clear support and resistance levels within a ranging market.
   - Buy near support and sell near resistance, targeting the opposite boundary of the range.

### 6. **Moving Average Crossovers:**
   - Employ moving average crossovers (e.g., 50-day and 200-day) to identify changes in trend direction.
   - Look for crossovers as potential entry or exit signals.

### 7. **News Trading:**
   - Stay informed about economic events and news that can impact the market.
   - Trade based on the market's reaction to significant news releases.

### Tips for Refining Your Strategies:
   - Backtest your strategies extensively using historical data to evaluate their performance.
   - Maintain a trading journal to record and analyze each trade, identifying strengths and weaknesses.
   - Continuously adapt and refine your strategies based on market conditions and personal experiences.

Remember, there is no one-size-fits-all strategy, and success in trading often comes from a combination of techniques tailored to your risk tolerance, time commitment, and psychological profile. Additionally, risk management is crucial, so make sure to set and adhere to proper stop-loss levels.

Thank you so much for your reply, I am very interested in range trading and moving average crossovers, but I cannot figure out a systematic way to make it work. Do you have any tips? 
 

In my experience that are 2 strategies that have a high percentage of wins:

- Divergence between volume and price - trade on the direction of the volume.

- For support and resistance, use volume profile - you will find strong and precise levels using this tool (you will need a custom indicator for that, MT4 and MT5 does not have such tool by defualt)

 
Marcel:
I was wondering if anyone out there could make suggestions for a strategy playbook that I could trade with. 

Currently, I trade using supply and demand techniques. I find a probable zone, I like there to be a gap in the impulsive move and a break of structure, I only trade with the trend and so if there is a change of character I do not take the setup. This has been good for finding 1:1 trades, but I seldom find anything higher than that. 

I also use a break and retest technique where I draw higher timeframe support and resistance zones, then I draw lower timeframe minor support and resistance zones, then wait for a break and retest of these and trade until the next zone. I have had less success with this strategy, most of the time my stoploss is very large because I have been stopped out many times when there was a retest that kept coming back into the range. 

I would like to continue to work on these strategies until I perfect them, is there another strategy someone can suggest I add to my playbook that has a high success rate and achieves high risk to reward. I would like to be trading with 3-4 setups in my playbook. 

Thank you!

Win rate and risk to reward are inversely proportional. You can unbalance their proportion with proper filtering. A proper filter is also the selection of a R:R ratio based on the nature of the market You are trading.

 
Marcel #:

Thank you so much for your reply, I am very interested in range trading and moving average crossovers, but I cannot figure out a systematic way to make it work. Do you have any tips? 

For MA crossovers, there are a couple of things I've learned:

  1. The best entries aren't the best exits. Fairly consistently, I've found that if you're trading purely on MA crossovers, you'll do better with a faster exit than entry. In other words, you'll need up to 4 MAs: Entry Fast, Entry Slow, Exit Fast, Exit Slow. 
  2. Alternatively, you can just use a single MA for the exit, checking price crossing that value. In that case, I suggest options for "touch" vs "close". Touch = move the stop loss on the order every time to the last MA value, so it will exit if the price hits it at all. Close = check on the close of a candle if it's below the last MA value, and only exit then. Which works better will vary depending on the pair, timeframe, and values of your MAs.
  3. In backtesting, run a first pass on multiples of 10 for the MAs. Make sure it works with common values. When you identify the right range, don't be afraid to go ahead and optimize by steps of 1. Yeah, maybe overfitting, but so long as it's still reasonably profitable to the multiple of 10 in both directions, why not? Especially if you have enough data to support it.
  4. You need to make some kind of filter to make sure that the average has crosses far enough and/or steep enough. You don't want to get trapped going in and out of multiple fast trades when the two MAs are riding on top of each other. Set a minimum distance and minimum angle, and optimize for those.

For range trading, there are dozens of examples of support & resistance in the CodeBase, including ready-to-use indicators:  Support & Resistance search - MQL5 CodeBase,

Specifically, check out this MT5 expert:   Free download of the 'Support and Resistance Trader' expert by 'QuantStrategies' for MetaTrader 5 in the MQL5 Code Base, 2018.09.13

New comment
Reason: