Okay, last week we left off looking at the following chart:
By the way, I actually traded this last night. So what’s so interesting? Here we have a one minute chart with an MA ribbon filled 2 X 14 indicator. Notice the candles right before the red line crosses the blue line hardly violate the red line. After the red line crosses below the blue line (signaling a sell), I’m looking for an entry where price is very close to the red line. The chart below shows my entry (red) and my exit (green).
So if I catch a good entry, that is right after the MA cross and close to the red line, it’s usually good for around 10 pips, sometimes 20 or more. Once I’m in, I set my stop loss just above the blue line, a 10 or 20 pip TP and I’m good to go. This trade netted around 17 pips. I could’ve stayed and longer, but I probably would have exited at the green candle that broke through the blue line had a state in longer, which I didn’t want to do looking at other EUR pair price action at the time. As I’m currently looking to get 20 pips a day with this method, and since I already had five pips in the bank, it was time to take profit (remember: trading plans are paramount).
Now, the reason I’m sharing this idea is because this is about as easy as reading a chart gets, and anything that can take the beginner from chart information overload to easy read/make quick pips is wonderfully encouraging, and best of all, when I’m using it I rarely get that feeling of “missing the bus”. Oh, let me not forget to show you the flipside to this strategy (that is, when not to take a trade). See the chart below:
This is the same one minute EUR/USD chart a little earlier in the session. Notice how the candles are all over the filled in area of the ribbon? That’s on top of the obvious sideways trajectory of price action. This is telling you to stay away, no trade at this time. But as you notice to the right of the chart, after the last cross of the red line above the blue line the candles are above the red line and not touching it, signaling a potential long position. Now as far as a strategy is a little more to it, at least as far as I like to trade it; I’m also looking at volume and momentum, as well as the relative strength of the euro and the dollar. But as far as reading a chart goes, this is pretty easy stuff.
Of course, as far as easy stuff goes, it’s really hard to beat expert advisors such as the Foltron or Cool Runnings in the “easy” department. Even though I tend to still be a little standoffish when it comes to auto traders, the Foltron is pretty insane as far as performance goes (that is, when I let it do its thing and don’t tamper with it). A great selection of expert advisors are just some of the benefits that go along with Sapphire membership in Slick Trade, along with educational materials, strategies, and more. So if you been thinking about joining a trading group, why not give slick trade a try? You’ll be glad you did!
That’s all for now, have a great week, and, as always, thanks for reading. JC