XAGUSD 4H long

Setups To Look At In The Upcoming Week

Hello everyone, hope you are having a nice weekend! In this post, I want to highlight some of the trades I took last week, as well as a selection of the setups that are part of the trade advisor members watchlist for the upcoming week.

 

Due to a non-stop stream of news events, last week was a week that favoured the longer-term daily setups in favour of the shorter-term setups. At the same time, we’re nearing the end of the year and a lot of traders will start to position themselves with risk reduction in mind, not so much looking to open a lot of new positions.

 

Nevertheless, there are definitely still trading opportunities and in fact, my full trade advisor watchlist includes 15 setups so plenty to choose from in the upcoming week. But let’s first review the past week!

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USDTRY

Get To Know Your Charts

I often get questions from traders to check a chart they took a screenshot from. The first thing I do is look up the same currency pair in my own charting platform. Why do you think this is?

 

As a discretionary trader, I value my chart layout as much as the chart patterns I look for. For many traders, chart-based discretionary trading means finding things like support and resistance, candlestick patterns and trend lines. You discover patterns in how the price behaves. This is the basis of price action theory.

 

chart 1

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Patience

How To Find Ways That Will Help You Increase Patience

Much has been written on why we need to be patient in trading. Be patient to wait for setups. Be patient with your winners. Most of these writings are correct: a lot of money is lost by not being patient enough. FOMO is real.

 

However, no one hardly ever talks about how to become more patient! How do we discover our patience? That’s usually a big mystery.

 

That’s what I want to talk about in this article.

 

 

Patience Is Also A Form Of Action

– Auguste Rodin

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USDCHF

How I Managed My USDCHF Short For An Easy Win

Early this week (well, actually while making my watchlist this weekend), I spotted a very nice setup on the USDCHF 4H charts. It had all the characteristics of a solid reversal setup and I was waiting for for my entry criteria to be fulfilled:

 

 

 

On Tuesday, we got our solid bearish signal! A massive bearish engulfing bar was printed, so once I saw this, I got in. I actually managed to get a slightly better entry than the close of this bearish engulfing candle, but the idea is the same.

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Backtesting

Top 5 Reasons Backtesting Is The Ultimate Skill


“I’m close to going live with my system! It works perfectly!”

– “Great! Have you backtested your system?”

“What’s backtesting?”

– “…”


 

Backtesting. One of those things no trader is really excited about. It usually takes a long time, involves a lot of data crunching and it’s generally, well, boring work.

 

Yet, it’s the one thing traders can’t live without either! To just say that it’s important for your trading success would be an understatement.

 

Elon MuskImagine you’re Elon Musk and you’re building SpaceX rockets. You’ll want to test if they can actually be launched and if they fly as expected, right? Backtesting is that step for trading. It checks if something works as expected.

 

Or rather, you need to ask yourself the question:

How can I make sure that my strategy has an actual edge?

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Trading The Reversal In Bitcoin

For a long time, I have been interested in bitcoin. I’ve been playing around with it since 2013 and I fully believe that the whole cryptocurrency ecosystem is only getting started.

 

e9a41a49a5da6b6492db0af0f4efe3deHowever, I’ve never featured anything related to cryptocurrencies on Smart Forex Learning! The biggest reason for this is that for a long time, I just saw them as a long-term investment holding, not something I’d actively trade. Nevertheless, I kept track of the price charts.

 

Interest in cryptocurrencies is growing and when I look at the bitcoin chart, it is starting to look like something I would trade. Cleaner charts, (relatively) less crazy spikes. It’s still not what you would call a quiet market, but a fast-moving market like this also provides us with opportunities.

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Fresh look at charts

3 ways for a fresh look at the charts

As traders, we create and settle in trading routines. They help us with building good trading practices and let us focus on the process, rather than the outcome. Of course, this is a good thing but often, this also means that we use the same way to look at the charts. We look for the same patterns. We do the same thing over and over again in order to get the right results.

 

But what if you don’t get the results you want?

 

Of course, this can have a multitude of reasons: bad risk management, FOMO, no discipline, not cutting losses, etc. Or how about this: maybe the patterns you look for are just not working? Maybe you need a fresh way to look at charts.

 

Perspective

 

By using a different point of view, you might be inspired to find new ways to gain an edge in the market and come out on top. In this article, I want to show 3 ways to flip things around and gain a different perspective on the markets.

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Using RSI divergence like a pro

Readers who have been following my weekly outlook for a while, know that I often talk about RSI divergence. It is one of the tools in my trading toolbox. But what exactly is a divergence and how do you correctly identify it? How do you use the RSI indicator in reversal trading and how does it help you spot reversal setups?

Divergence

 

 

I get a lot of questions about the details of how to use the RSI indicator in general and RSI divergence in specific, so let’s go over everything you need to know in order to use RSI divergences like a pro.

 

What is RSI?

 

Now, to understand RSI divergences, the first step is to know what the RSI indicator actually measures. Most of you will have seen it on your trading platform, but do you really understand what it does? Let’s have a look.

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Deliberate Practice

Deliberate Practice in Trading

 

You just need more chart time“.

 

I hear this advice all the time. My take on this? Yes and no.

 

Yes in the sense that as a beginning trader, you do need to develop a feel for the market you’re trading. Without any time in front of the charts, you will never understand the natural rhythm of a market, patterns, the influence economic news has on the price, how support and resistance are used, etc. In other words: chart time is a way to develop a gut feeling about how the market operates.

 

No in the sense that beyond the experience developed by initially observing charts, staring at charts without a purpose won’t increase your knowledge level and more importantly, won’t necessarily improve your bottom line.

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Cut losses short and let winners run

The Art of Cutting Losses & Letting Winners Run

For years, I was losing money because I didn’t get it. Not really. You hear it everywhere, it’s probably the best-known trader’s mantra in the world:

 

Cut Your Losers Fast And Let Your Winners Run

 

Often, people just skim over this line as something that’s probably true, without any second thought. We know what it means, but we don’t act on it. And we do this all the time in our lives: a smoker will occasionally think: “I should stop smoking”. Many people have this thought in their mind: “I should start exercising”. I should contact my friend whom I haven’t spoken in months. I should go on that world trip I’ve been planning for years.

 

I should cut my losses faster and let my winners run.

 

I really should

 

I should.

 

Yet, most of us don’t.

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