In this blog I am going to share the real experience of my routine as a successful trader using system i coded in MT5
1. Manual Research : I started researching manually on chart with no indicator attached. I understood price action and fibonacci which is what made me successful.
What is price action? Any activity which happens on price is called price action, for example a pin bar candle is price action, it represents a strength of one side party, A doji or Spinning top is price action because its represent a war in market. So you must be wondering is it just as simple as that? No. Price action is complex topic to master.
Al Brooks wrote a full book on this topic. However I believe price action does not require use of any indicator such as EMA or RSI. a price action trader trades naked chart. However in this world nothing is controlled naked. You need to measure it. A carpenter measures the wood before cutting with inch tape to make a chair, similarly a price action trader uses two methods to measure price action of price.
1. Geometry : A trader may use lines such as trend, the deviation of lines such as fibo channel, Angles to trace velocity of price movement with time, Pitchfork to find if parallel movement is balanced or not and many other methods such as Gann Grid.
2. Fibonacci : To measure swing either in horizontal or dynamically using Fibo Channel, Fibo Wedge, Fibo Fan and there are more fibo related tools.
The only difference between geometry and fibonacci is that in fibonacci fibo number is used such as 1.618 2.618 and 4.236 while in geometry a trader may use fibo tool and customize with geometrical numbers e.g. 1 2 3 4 5 etc or 0.5 1.5 2.5 3.5 etc These are usually important numbers for Grid traders
You do not require to put all your effort on other topics e.g. there are infinity topics to study ways to trade, e.g. Content creators on Youtube come up with new idea everyday like Market Profile, Order Flow, Volume profile etc. Let me tell you You make your chances very low if you keep studying new trading methods everyday. I follow only and only one method to trade everyday.
When I started trading with this method, I made good money but lost all in once due to human errors, Later i coded all things in MT5 which make it now impossible for anything to miss and cause human errors again, Every calculation including risk, lot size, sl tp, order placement via EA on press of button, Structure analysis, technical analysis and all filters are coded.
If you have some strategy and you have good win rate, you may be feeling good, but when you trade you always have fear in mind and you risk losing your money, Do you know why this happens? and what is its solution?
This happens because your mind don't have enough data to be 99% sure before you risk your $1000. You know market is random and your strategy is showing some performance on chart does not necessarily means it will reward you with guaranteed profits or wont wipe your account to zero. It may happen, even if you have higher win rate because Market is almighty magical and random until you prove yourself that its not random by back testing your trading method and keep correcting it until its made perfect.
Do you know the algos which are deployed in market are magical? No. They are also relying on historical data. Whatever happened before is going to repeat. This is the law of nature and nature is followed up by mathematics and fibonacci is one thing which is natural. Once you complete your manual research then only proceed to step 2
2. Coding a program: Do not think about making money automatically by coding a magical EA because its not going to happen. People put years of effort understanding the market movement, if you have a strategy with 90%+ win rate and you code an EA or get it code, there is 5% chances that EA will be successful.
There are two sides of the game.
A : Side A where you only rely on historical data. My friend told me that his friend who is a General manager in a big company started having interest in trading and used mock trading app where he is making 1 to 5 Lacs everyday (approx 1000-6000 USD) and now talks very high says my future is set. I am going to leave my job. When i told him that he is an idiot, my friend laughed too much. In mock trading you never know if your quantity is being accepted by almighty market in limit order or if its accepted as market order. The major problem is what you do in mock trading app will never be same in real trading. You will have fear, emotion, human errors, system errors e.g. Broker /Network / Ping errors, Slippage and countless things which can not be explained here now.
B : Side B : The real game, You may have heard broker may track you, well it happened here in India the number 1 broker here was tracking a user account by copying it, Years ago a Youtuber uploaded a video that as soon as he placed a trade in Pidilite India stock, someone added same amount of order below 1 pt of his order which was reflecting on market order book, and as soon as he cancelled order, the other side order was also cancelled. So my friend dont dream to make big everyday very easily. Side B includes fear, emotion, human errors, system errors e.g. Broker /Network / Ping errors, Slippage and countless things which can not be explained here now. If you don't have experience making profit of $1000 in a broker if you expect to make $1000 then its not going to be possible. Let me tell you my real experience, I am a binance trader and I switched to other broker for some reason and I started losing, what was reason? It was that my exit point was 200.00, price came there but wont hit my order and price reverse. in Binance price comes there go a little but down too like 199.98 and reverse but in other broker price freezes to 200 and jump making my position to force close in loss. Who is going to share this experience? No one. But I am sharing in this blog. So make sure your broker is reputed before staring real trading.
So to start coding, First write an indicator which helps you 50 to 70% in tasks which are not required to track everyday such as you trade Engulfing pattern, but you find it manually, Don't you think this is waste of time? You can code a function to find engulfing on chart, so you can focus on next steps instead of wasting time finding engulfing pattern.
Once you achieve all what is required then slowly proceed to code EA, but remember EA may take years in effort to optimize it and reduce losses until its based on Grid or Martingale. Grid or martingale do not require too much optimization if you have high win rate. If you have one shot buy sell sl tp method then yes it will take years.
3. Daily Optimization : Even today I keep testing my same strategy I trade every 4 to 5 days in history. I am keen to learn if it fails, why? Whats the cause. If you don't code your rules you will not be benefited in finding whats causing failure, but once you code it, it will be easy. Such as I watch Back and front of a swing. The back is called XA and front is AB
If there is any problem in XA or AB, i am not going to trade my structure. If all is well, I will trade, but this is not so simple. I have coded so i don't have to verify it manually.
It does not matter if you are winning or losing, You can not avoid back testing because this almighty market is operated by algos and who knows when the big fishes are going to stop that? Yes its possible they can be stopped or changed because remember nothing works permanent in this market. Change is inevitable.
You were using a cellular phone now you use Smartphone, same way things keep changing on trading as technology is becoming advanced. If you find something holy grail ( day trading / scalping . full margin trading method ) it will disappoint the market movers and hedge funds and they will push all limits to stop you (until you are an investor)
So you have to understand and accept this. Market is dog eating dog world, No body is going to help anyone in this industry. You should be the lone warrior and learn to hunt to survive else be ready to empty your trading account.
