Just follow your Trade Plan!!

Getting wiped out on the 1st few trades of the week definitely not a great start for the week, especially we are trading on the infamous month of October, the trading month of the year.

Trade Ideas Anlaysis: GBPAUD Head and Shoulders by raynlim on TradingView.com
GBPAUD H4 Potential Head and Shoulders, CounterTrend
Short EP: 1.8506
ISL: 1.8620(-114)
TP1: 1.8410(+96)
TP2: 1.8243(+263)

The way I trade Head and Shoulders is kinda a bit different from the mainstream. The problem with head and shoulders is that most of time the Reward:Risk ends up to be less than 1:1 (usually around 0.8:1). Meaning to say if you have a 50/50 win rate, you will lose money.  I usually exit these Head and Shoulders trades only at a single target but this trade is different. As the trade hit target 1, I already achieved the desired 0.8:1 RRR of a Head and Shoulders trade. This gave me the opportunity for me to shift my stops to the entry price, hence attaining a Risk-Free Trade and that was what I did.

The trade then moved lower to hit Target 2 resulting in a total net profit of +359pips for this trade. This ONE trade alone pretty much more than covered back the losses from the previous trades and turned my trading week into a profitable one.

We just have to follow our plans, don’t we?
Problem with most traders, once they hit 3 losses in a row, they start looking for the next trade plan, next strategy, even a next mentor. When the 4th loss comes up they will go into the downward spiral mood by saying, “SEE! Told you, this thing doesn’t work.”
Guess what, they didn’t get to see the 5th profitable trade.

You just have to have confidence in your trading plans and just stick to them.

GBPUSD -Weekly Market Analysis-October 2018, Wk 1 by raynlim on TradingView.com

GBPUSD D1 Bearish Butterfly, Short on Retest
Short EP: 1.3231
ISL: 1.3486(-255)
TP1: 1.3027(+204)
TP2: 1.2978(+253)

The only thing that is wrong about this trade is the naming of the chart. It is supposed to be GBPUSD and not GBPJPY. That’s what happen at times when you are looking at many pairs and doing couple of things at once, isn’t it? But a trade is a trade, we engaged the trade the 2nd time after 1st trade got close up.

This is very much known as the Type 2 trade of the pattern, and yes we can enter twice but do note of there are filters and confirmation before engaging the second time. Personally, I will not ‘set & forget’ for the Type 2 trade as I would love to see how the candle forms up before the engagement. There are other filters and considerations that I apply. Questions like, “Am I Trend Trading or Counter-Trend Trading?” or “Does the Support and Resistance hold up well?”

These rules should be firm up before thinking of engaging a trade before you form your traders’ bias.

Trade Ideas Position: AUDCAD Bat by raynlim on TradingView.com

AUDCAD H1, Bearish Bat, Trend Trading
Sell Limit: 0.9300
ISL: 0.9333(-33)
TP1: 0.9274(+26)
TP2: 0.9228(+72)
Target2 taking extended targets

Before you start thinking, why not just trade off the higher time-frame, it seems to work better. Here is a on the H1 chart that worked pretty well. Target 1 achieved and we gained +26pips, shifting the protective stops to entry that allow me to have a Risk Free Trade. It is good to kick in this safety measure to protect the trades and prevent them from turning into a losing trade.

Based on my filters and analysis at times I don’t take conservative targets as I’ve married the knowledge on trading Harmonic Patterns with how I had been trading over the years, structure trading. This is now giving me excellent results, but don’t try it till you truly understand the content of each methodology. It took me 6years in learning Harmonic Patterns and to marry them both together.

Trade Ideas Position: GBPUSD Bat by raynlim on TradingView.com

GBPUSD H1 Bearish Bat, Counter Trend
Sell Limit: 1.3233
ISL: 1.3281(-48)
TP1: 1.3181(+52)
TP2: 1.3145(+88)

And if I didn’t refer to my inner circle group of traders, I would have missed this trade. Another great example of a smaller timeframe being able to produce great results too. If you chose to enter this trade, then you are riding off a trade on a bigger timeframe as well.

You have to consider when you are taking 2 trades base on 2 different trading strategies and timeframe, in the same direction. Would you be over exposing yourself to trades on a single currency pair?
How about if the smaller timeframe gives a buying signal while you are already in a short position of the higher timeframe?

That’s is why all traders need a coach.

It pretty much look like we got a 50/50 week, before writing this I though I have a 4losing trade with 2 winning trade and yet it is a very profitable week. Most importantly, these 2 post share the importance of 1) having a healthy reward:risk is critical to your trading and 2) follow your trade plan, don’t doubt it.

By clicking the play button you can all see that how the market react after the point we have share our trades, join us now in our inner-circle, right away, so you can see how traders like ourself plan our trade in advance of the move.

You see, trading is very much about following the rules and execute your plans, that’s why having precise rules on trading as well as trade plan that you know it works and follows to the tee.

There’s an old saying when you fail to plan, you plan to fail. Likewise in trading, plan your trade, trade your plan.

Let’s see how the rest of this week trade turns out by clicking this link.

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*Note : The charts used here is just for price feed purposes, we do not have an account with FXCM.