Saturday, April 25, 2015

HOW DO YOU FIND 10-PIP TRADES?

Here are seven principles of 10-pip trading:
Principle 1: Buy and sell on breakouts of support and resistance. Or, sell when a currency pair hits resistance and buy when it hits support. I teach this in the 1 on 1 training, and this is my major trading strategy.
Principle 2: Stop trying to make $8 million on every trade.
Principle 3: Set a 10-pip limit only. Exit the trade at 10. Exit the trade at 10. Stops are set based on market conditions, but are always set.
Principle 4: Goal: + 10 pips every time you trade. You don’t have to trade every single day. Only trade
when the market shows you an opportunity.
Principle 5: If I earn more than 10 pips on a trade because the trade moves so fast in my direction, I can set my stop to protect the 10 and then go for more.
Principle 6: There is no ‘makeup’ strategy. If I take a loss, then I’m just trying to end up with a 10 pip gain for the day. If I can’t get it, then I don’t try for 20 the next day, or whatever. I can keep trying for the 10 pips gain as long as I haven’t lost more than 5% of my capital.
Principle 7: Time: I can trade for a set number of hours per day, meaning I can have the trading platforms open and sit at my computer for a max of, say, 5 hours per day. If I can’t earn my 10 pips during that time, then I can set my stops and limits and walk away, but I can’t actively watch the market any longer.
So, what kind of daily routine does it take to be a 10-pip trader? Here’s one example.
Here’s a daily routine that I’ve used in the Strategy:10 system. Some of the most successful months of my trading career happened when I followed this plan.
Up at 3:00 am Eastern Standard Time (when the market is most active). Check the charts.
Ask the following questions:
Where did the USD close (5pm EST) yesterday against the majors?
What effect will today’s economic reports have, if any, on the forex market?
Are we at an all time high or low on any currency pair?

What one pair am I going to focus on today?
Where are the major areas of support and resistance on this pair?
What are some good breakout entries? Some good entries when a pair fails to break out?
Following this set of questions does not ensure that you are going to earn 10 pips every trade. But it certainly helps you. The most important question you can ask is What is the major trend in the currency pair that I am watching? If you trade with the trend, you are more likely to be able to find some 10 pip trading opportunities.



1 comment:

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