Grizzly bears are specially adapted to survive the changing seasons. During warmer months, they eat a massive amount of food so they can live off body fat during the winter, when food is scarce. In the fall, as temperatures cool and food becomes scarcer, grizzlies dig dens in the sides of hills. What they are doing is stacking the odds in their favor for cold weather survival.
Life lessons tell us to plan and prepare for our survival. Even the bears know that. When it comes to trading the Forex market are you “stashed for cash” or “out in the cold”? No one likes to lose money. It is the antithesis of why we trade. But to survive we must prepare by stacking the odds in favour.
That is the premise of this renowned Forex Trading Strategy – FX ULTIMATE: Stacking the odds of trading survival in our favour to help us spot profitable trades. There are SEVEN key concepts that make up our “survival stash”, so to speak. They are:
Here’s a run-down of all four and how they can help you “stash for cash” – and trading survival!
Price Action
If we are counting on indicators to help us predict the future there is something we must realise: All indicators we place on our charts are out of date before they are drawn. They are great for helping us look back in time but since they rely on past price data and past movements they can’t predict the future. Nothing can. Because of that is pays to open a clean chart, study price action and ask ourselves a few questions:
By asking ourselves these questions before we place our indicators on the chart we can spot points of reversal, areas where we have room to run or places where we can watch for a confirmation of our assumptions. Current candlesticks can then suggest whether we’re on the right track, if the market is breaking out, consolidating or possibly reversing.
Trend Direction
Imagine that you are going on a ski vacation. You’ve booked your reservation, made sure your equipment is in tip top shape and packed for the weather. Now, standing at the bottom of the mountain, you strap on your skies to ski up the mountain.
Wait! Would you do that? Not likely. Everyone knows skiing is a downhill sport and you don’t try to buck the trend and go against the mountain.
So why would you do that in your trading? If price is making higher swings there is a reason. If it is making lower swings we know we are in a downward trend and should be looking for opportunities to sell. Your job as a trader is not to move the market, but to spot market movement. Countertrend trading carries a lot of risk, so for the purposes of High Probability Trading we recommend you stick with placing trades with the direction of the major movement.
Yes, there are momentary pullbacks during the upswings. There are also points where price may climb higher during a downward trend. How do you know whether you are getting fooled by momentary adjustments or pauses? To answer that we need to spend a little time talking about tools that are available to us as traders.
There are a few indicators which you can use to keep you from trying to “ski up the mountain”, or buck the trend. One of the visual indicators that we find useful is the Rahul Mohindar Oscillator (known as RMO). This indicator visually smooths out the minor pullbacks or advances against major trends to allow traders to sit tight during abnormal movements.
Another tool which indicates major trend direction, and even possible upcoming reversals where a currency pair could be overbought or oversold, is the Relative Strength Index, or RSI. Placing this indicator in your chart can also keep you trading in the direction of a major trend, providing a higher likelihood of a profitable trade.
RSI also form chart patterns that might not be shown on the underlying price chart, like double tops and double bottoms as well as trendlines. These can give heads up for a change in market direction.
If RSI is moving in the opposite direction of price, this shows potential divergence or convergence which can signal a price reversal. So as you can see already, a single indicator providing multiple tools.
When monitoring trends it’s also important to think about where trends might pause for a while, reverse or break out. We do that by adding price pivot points. A pivot point is a technical analysis indicator used to determine the overall trend of the market over different time frames. The pivot point itself is simply the average of the high, low and closing prices from the previous trading day. Theses pivot points are calculated for daily, weekly and monthly time periods. So, if you are trading on an intraday chart you’ll want to look back at daily pivots. If you trade on the daily chart you’ll want to pay attention to previous weekly or monthly pivots.
Pivot points can create bumps in the road if you are in the middle of a trade. They can also signal points where you could place a trade if the candles on your timeframe pass these highs, lows and closes on longer timeframe charts. They can also give you stop loss points if your trade approaches these potentially sticky places as well as target levels to exit trades.
In fact, the projected support and resistance generated by pivot points tends to work better in FX (especially with the most liquid pairs) because the large size of the market guards against market manipulation. What is great about FX ULTIMATE is, that the right pivots are automatically applied on the relevant time frames – so you have to do NOTHING!
One final note about trends: Don’t forget to watch your moving averages. These can be useful in determining how much room a trend has to run. If a trend is approaching a major moving average it is not uncommon for you to see price retrace or consolidate while the market determines whether to push through the average or pull back. They also give us heads up when we are seeing a change in trend behaviour as well as the strength of the trend in play. Moving averages are underestimated directional indicators. Ignoring them gets a lot of traders into trouble.
Momentum
You are seated comfortably in your seat. The plane moves into position and you can feel the engines power up preparing to rumble down the runway. With enough momentum it lifts and the ground disappears. Then there is that brief period you can’t see much while the plane pierces the clouds, only to come out on the other side to a beautiful, sunny sky above. Your plane has reached its cruising altitude.
Think about that take-off. It takes a lot more determination, power and momentum to move that plane up into the sky than it does to fly at a cruising altitude.
The same can be said for the market. While it is in a trend, up or down, it takes momentum for it to move. But at some point it will have reached the point where it cruises, or consolidates, while determining if it wants to continue its upward or descending trend. Cruising is the point that High Probability Trading would say, “back off”.
A favourite saying of mine is, “If there is no momentum there is no movement. If there is no movement there is no money.” We’ll see a trend potentially lose its momentum as it approaches key reference points, like, for example, moving averages. We’ll also see it “cruise” while the market is waiting for a news release which can impact movement and direction. It is at these times of lost momentum that we want to simply be out of the market due to uncertainty in direction. It’s too risky due to the simple fact there that there is no clear movement.
Candlestick chart patterns also can warn a trader that momentum is being lost. Candlestick patterns are a form of technical analysis and charting used in all markets. They can be used in all time frames, from those looking for longer term investments to those who use swing trading or day trading. The power of candlesticks is that the excel at giving market turning points and when used properly can potentially decrease market risk exposure.
For example:
**NOTE** Black and white candles are found on standard charts. In the examples and graphics here, we have used our own template that shows Bull candles as Blue, and Bear candles as Red. This creates a more visual aspect to the chart and the directional movement of each period.
Now whilst the body of the candles are often considered the most important segment of the candlestick showing the range between the open and the close of that period, there is also substantial information from the length and position of the shadows (or wicks). For example, a tall upper shadow shows the market rejected higher prices whilst a long lower shadow shows the market has tested and rejected lower prices. Candlestick chart patterns will often provide reversal signals very much earlier that sometimes not even available on bar charts.
Learning some of these “cruising” patterns, where momentum is uncertain, can give the High Probability Trader insight and a distinct trading advantage while maintaining the “stashed for cash” survival mentality.
Knowing that candlesticks with small bodies are lacking in momentum versus larger bodied candles, we are able to see in real time, consolidation, reversal or continued trend behavior. For high probability trading we are looking to trade candles with larger bodies that back up momentum behind the move.
There are also visual indicators traders can use when trying to determine if momentum is waning. Our favourite is OsMA. Coded to provide both trend direction as well as momentum behind that trend, we can see at a clear glance whether a profitable trading opportunity is available.
Using Multiple Time Frames
We cannot have a discussion about High Probability Trading without considering the importance of using Multiple Time Frames. Let’s go back to our plane illustration for a moment and you’ll see what I mean.
Imagine we are on a longer flight to reach our destination. At departure we might think about the weather and how, if it’s bad, it could present possible delays. A few of us might even look up the weather at our destination to know what to expect once we arrive. But we probably don’t think about the weather our plane has to fly through during our flight.
Ah…but our captain does! He or she will radio ahead and look for weather that could signal potential problem areas or turbulence. The captain will then chart a course to fly over or around bad weather, or at least know where to be prepared.
Now let’s apply this to our trading with an example. Let’s assume you are trading on the hourly chart. While looking at price action we see we are in an upward trend with good momentum – no warning from your candlesticks that price is about to consolidate or reverse. It looks like this is a good opportunity to buy.
But wait! Did you “radio ahead” to see what your trade has to fly through? By that I mean, did you flip to other timeframes to see if there are areas you can’t see on the hourly chart that could present some rough turbulence during your trade? Have you looked to find:
And what if your hourly chart contradicts other timeframes? What if your hourly chart shows an upward trend while the daily shows a downward trend? What if a 15 minute chart shows price consolidation? Would that be confusing? Absolutely!
In order to place a trade with High Probability setups you’ll likely want other timeframes to confirm your trend on, in this case, the hourly chart. You’ll also want to be aware of potential turbulence in your trade by looking at longer and shorter timeframes. This helps you avoid those “sure thing” trades that go sideways or in the opposite direction as soon as you pull the trigger.
Money Management
Nobody wants lose money, but we must be reminded that there is no trader in the world that does not suffer a loss at some stage in their trading career. Some more than others. It is our responsibility as a professional Forex traders and educators, to ensure that you protect your capital and trade according to strict money management so that you limit your risks.
We have an incredible tool that will enable you to work out the risk before taking the trade and tell you exactly the amount you can bet per point in accordance with your account balance and the risk that you are prepared to take. All of this is developed into this incredible FX ULTIMATE strategy. You will never go without this important tool!
Email Alert System – Never Have to Sit Watching the Computer Screen Again!
Wouldn’t it be great to know when you have sufficient “fuel” stashed away and you cant sit back, relax and watch other traders still scurrying around looking for trades to fuel their account?
What is incredible about FX ULTIMATE is that this strategy can email you once your trade set up has been reached according to your criteria. What does this mean for you?
It is FANTASTIC!
THE ULTIMATE TRADERS CHECKLIST
Never enter another trade without having completed thorough analysis before doing so. Many traders enter positions without contemplating aspects that may effect that trade. By following this checklist you will be sure that you enter trades with confidence knowing that you have thoroughly analysed the instrument .
By keeping records of these checklists you will also be able to create a trading record that can be used in group to develop your skills and help formulate a trading plan.
The key to being in the top 5% of professional traders is to stick by strict Money Management. This tool, implemented on every chart will work out your pip value for every trade you take with just a few simple clicks.
Tell the tool what percentage risk you are will to take per trade and the position of your stop loss and let it work out the rest for you! Never over leverage again!
Serene Education’s FX Ultimate4 strategy plus extras! This strategy will help you see at a quick glance both the trend direction and momentum of the stock, commodity, crypto currency of Forex pair across 8 different time frames. Not only will it help you take trades in directions of major trends, but also show you when the market is pulling back or losing momentum. Automated support & resistance levels will appear on your chart taking the strain out of finding these positions yourself! Simple rules apply to this fantastic formula, that will see you taking profitable trades in no time at all! Inclusive in this strategy is the Box Breakout strategy for intraday traders that will automatically appear on relevant time frames. This is the best trading strategy on the market!
Have you ever had that experience whereby you sit, watch and wait for the market to make it’s move, only for it to do it when you leave your computer? This becomes frustrating over a period of time, especially when you miss opportunity after opportunity. Well now with FX Ultimate, you will never miss a trade again. Carefully designed to send you an email when the criteria of the trade has been met, all you have to do is check your emails and head back to your computer to place the trade! A revolutionary way of trading is right here!
Do you find setting up your computer with strategies and formula intimidating? Fear not! We have a step by step instruction guide on how to do this that will details each process for you.
Remember that at any time, support is just an email away at support@sereneeducation.com.
BUT THAT IS NOT ALL…
Serene Education is all about customer support. We know that the way to the top as a trader, is through the support and dedication of your mentors. For this reason, we have included 1 Months VIP access to our Traders Support Forum. Log in daily to:
Take a sneak peek at a short clip of what FX ULTIMATE is all about. Remember – this is only a sneak peek! There is even more to this strategy then this video!
Please note that trading the Forex market carries risk and that you should only trade with money that you are willing to lose.
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