ElectroFX Pure Price Action Trading - page 6

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philt
415
philt  

Do you have any trading stats to go with your strategy?

Theo Patsios
317
Theo Patsios  

Hi Phil,

It is very possible to achieve a 70%+ win rate with this style of an evidence based approach as long as you are patient and wait for proof of everything I have outlined. The good news is that as long as you apply the risk:reward part of what I have outlined then you could be very successful even winning 50% of your trades. I teach this method extensively at my site discussing before and after the trades in our live room. One thing I have learnt over the years of teaching is that my stats will not be the same as another persons even when trading the same style, and even when pointing the trades out, the method doesn't change but the psychological effects on each individual does which then in turn effects how the trades are managed. Trading is much easier to learn than mastering trading psychology and the latter is a personal journey that varies dramatically.

The beauty about the naked chart and this approach is there is no repainting involved so you can asses the stats for this strategy all by yourself if you spend some time with your charts. The MT4 strategy tester is a good way to practice and to assess if this style works for you in a more real time environment, you start up a test on the timeframe you want, then pause it, and start using f12 to advance the charts as they would advance in real time. This is very close to how things will be for you live but of course you can advance much faster than if it were live and experience a year of trading in MUCH less time. I highly recommend this as a way to speed up the learning curve and gain chart experience, also to see if the method you are addressing works for you specifically.

markcoronado
33
markcoronado  

I really appreciate you taking time to share your price action strategy.

Looking forward to seeing what is next.

Theo Patsios
317
Theo Patsios  

Before I continue I want to make sure that these 4 slightly different trades are clear and no questions have arisen?

Essentially you can break it down into a 3 step process.

  • Location and Market flow (on at least 2 scales)
  • Entry Trigger to prove you are just joining in
  • Intelligent management and risk:reward judgement
markcoronado:
I really appreciate you taking time to share your price action strategy. Looking forward to seeing what is next.
markcoronado
33
markcoronado  

I have a couple of questions.

On trade 4 why did you decide to take a long trade instead of short like the first 3?

"Location and Market flow (on at least 2 scales)"

What do you mean by (on at least 2 scales)?

electrofx:
Before I continue I want to make sure that these 4 slightly different trades are clear and no questions have arisen?

Essentially you can break it down into a 3 step process.

  • Location and Market flow (on at least 2 scales)
  • Entry Trigger to prove you are just joining in
  • Intelligent management and risk:reward judgement
Theo Patsios
317
Theo Patsios  

On trade 4 I took the long because that is what the evidence provided. There was a great location and we were still following that swing 2 trend of higher highs and higher lows, the entry trigger formed, and there was fantastic risk:reward available even when being conservative.

In these examples I always talked about swing 1 and swing 2 depicted on the charts by the Green larger scale movements and the Turquoise faster scale movements. That is all I mean by scales, the Green waves are relative to one another as are the the Turquoise. In order to trade the swing 2 waves like we have done in all 4 examples you must be mindful of what is going on on the next scale up. (which in these examples was swing 1).

markcoronado:
I have a couple of questions.

On trade 4 why did you decide to take a long trade instead of short like the first 3?

"Location and Market flow (on at least 2 scales)"

What do you mean by (on at least 2 scales)?
markcoronado
33
markcoronado  

OK lets see if I got this right.

If we're using the 4hr chart the green lines with the arrow heads would be the daily chart and the turquoise lines would be the 1hr chart.

We would look for the double tap and indecision candles on the 1hr chart.

Is this correct?

electrofx:
On trade 4 I took the long because that is what the evidence provided. There was a great location and we were still following that swing 2 trend of higher highs and higher lows, the entry trigger formed, and there was fantastic risk:reward available even when being conservative. In these examples I always talked about swing 1 and swing 2 depicted on the charts by the Green larger scale movements and the Turquoise faster scale movements. That is all I mean by scales, the Green waves are relative to one another as are the the Turquoise. In order to trade the swing 2 waves like we have done in all 4 examples you must be mindful of what is going on on the next scale up. (which in these examples was swing 1).
Theo Patsios
317
Theo Patsios  
markcoronado:
OK lets see if I got this right.

If we're using the 4hr chart the green lines with the arrow heads would be the daily chart and the turquoise lines would be the 1hr chart.

We would look for the double tap and indecision candles on the 1hr chart.

Is this correct?

If you were to assign timeframes to the swings then you are correct although you could go to m30 to look for those immediate double taps. The point is that this is all possible just looking at the H4 chart by itself. I do however recommend watching more than 1 timeframe to fine tune entries when you are comfortable with that you are doing.

Although this is clearly possible with candlesticks I have long since moved away from the limitation of time and do this exact same thing with a timeless chart. I have just scrolled back to the same section of the EURUSD using something that I have created over the years working with a programmer. This picture is just for educational purposes only to show you these swings much clearer, I don't want to turn this in to an ad for my site as that would not be fair to this forum owner.

Here you can see the same trades but everything is drawn in for you, almost like training wheels on a bike. The purpose of me showing you this pic is to let you know that although you can assign a timeframe to each swing as you have in your post, it is more about wave relativity than anything else.

here is the H4 again.. same image but needs a little more effort to read

Files:
Theo Patsios
317
Theo Patsios  

Let's now touch on another type of trading this same approach. Breakout Trading

Here we have the same chart and there are several breakout trades on there but let's just move on from Trade 4 that we just reviewed and look at the one that cam right after.

A major area of Resistance was broken and the swing trade was now over... the direction and flow is clear and providing this same area of what was once resistance now acts as support you have your location proof. The indecision candle cluster shows the area is holding up and your entry trigger is a break of that high created on the first push out. Stop Loss goes below the cluster and shooting for a 1:1 risk:reward is the conservative non-greedy play.

These breakouts maintain the same concept as the swing trades... Location Location Location, Entry Trigger, Good management

Files:
eurusd11.jpg 78 kb
markcoronado
33
markcoronado  

This is becoming more clearer now.

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