forex trading strategies Archives - Professional Forex Trading "Live" With Rob Taylor

The Importance Of A Clearly Defined Strategy For Forex Trading.

June 27, 2018June 27, 2018Rob Taylor

I was prompted to write this article after a conversation I had with a trader yesterday. He came to me as he was considering taking my training course, but he told me he was already receiving training and mentoring from another “professional trader” but he was struggling to make money in the markets and could not work out whether price was going up or down.

After talking to him for a while it was very clear to me that he did not have a clear strategy for entering and exiting the market. Which I found very odd since all professional traders have clearly defined, tried and tested, profitable trading strategies for entering and exiting the market. So the question needs to be asked, is this guy who is training and mentoring him really a professional trader, or a con man that calls himself a professional trader?

Now, most people don’t mind wasting a couple of 100 bucks on wannabe professional traders that sell training courses, but this guys course was almost $3000, which by most standards is a lot of money to waste on someone that claims to be a professional trader, but does not have a clearly defined profitable trading strategy.

So if you are considering another “professional trader” other than myself then please do yourself a favor and ask them these questions.

1. Do you have a clearly defined strategy for entering and exiting the market?
2. Is the strategy a professional trading strategy? (Most of them will struggle here because they don’t know the difference between a professional trading strategy and a retail one).
3. Is the strategy a profitable strategy in all market conditions?
4. Can the strategy be backtested over at least a 10 year period, and is the strategy a profitable strategy over that period?
5. Can the strategy be traded on any pair?
6. Does the strategy work on all timeframes from the one minute to the monthly?
7. Can the strategy be traded at any time of the day or night?

If you do not get a clear YES to all of those questions then move on.

Any Forex trading strategy should meet all of the above criteria. If you do not get a yes to all of those questions then please consider spending your hard earned money somewhere else, because the so-called professional trader is selling you the same retail trading rubbish that you can get on YouTube for free.

The Forex training business is full of con men, do not fall victim to these parasites.

Thanks for visiting have a great day. 🙂

How To Be A Sucessful Forex Trader Using Market Logic.

July 11, 2015July 11, 2015Rob Taylor

In order to be a successful Forex trader you have to keep it simple. I have many profitable strategies that i use to make money from trading, but they are all based around simple market logic.

So what is market logic?

To understand market logic you have to understand the major forces that drive the market. What makes prices move up and down?

Most traders think that buyers and sellers move the market up and down. Now although that is true its not the only factor that drives price.

Other factors that influence price.

Think about this. When you enter a trade you buy or sell the market at a specific price. Now whether that trade is successful or not, you will have to exit that trade at some point in the future.

So say you buy the market, and set a take profit and a stop loss. Now in order for you to exit that trade, whether in profit or loss, your buy order will have to sell the market at some point to close out your position. So just by closing your trade you are influencing price.

The power of the majority.

If everyone is selling the market, why would you want to buy it? If everyone is buying the market why would you want to sell it?

This is a mistake that a lot of retail traders make. They try to catch tops and bottoms. I have done this myself when i first started out. How many times have you seen prices going down, and thought its going to reverse here, this is the bottom. So you pile in, only to see it go further down, and you think why is it going down, and down and down?

Well think about it logically. You buy at what you think is the bottom, and a few 100 others do the same, because lets face it, its not only going to be you that thinks its the bottom, there will be 1000s of other retail traders that think the same thing, who will also be buying at various levels.

So if all of these retail traders are buying, why is it still going down. Because the majority are still selling, and your buy orders are adding to that selling pressure.

How can buy orders add to selling pressure?

Well think about the other factors that influence price. Buy orders are seen as positive by the majority of traders, but when you have a strong downtrend they are negative. They are fuel for the fire of the downtrend. Why? because those buy orders are closed out with sell orders.

So as uninformed retail trades are trying to catch tops and bottoms, their stop losses are adding strength to the move, as those buy orders close as sell orders. Even if some traders do manage to catch a temporary bottom, when they close the trade for a small profit, their sell orders will send prices down again.

Major reversals in the market.

So if what im saying is true, and it is, what makes the market reverse, if its not buyers? Well if its not buyers that make the market reverse, it must be sellers right? Yes, but not just sellers. There are 3 main factors that will make the market reverse from a strong downtrend, or a strong uptrend. Buyers, sellers, and profit takers.

In this case we will work with the downtrend. As we have already established by trading against the majority you will lose your money.

The picture below shows how buyers, sellers, and profit takers affect the market.

In order to avoid losing money in the market, you always have to be on the correct side of the move, and trade with the majority. Following the trend is not always the answer though, as you can see how the buyers and sellers in that downtrend got smoked by entering at the wrong time. You have to enter and exit the market at key reversal levels in order to be successful.

My Forex training course will show you how to enter and exit the maket safely, and how to trade alongside the professionals.

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Make over 100 pips profit with this strategy for trading the news.

April 20, 2014July 11, 2015Rob Taylor

Trading the news can be very profitable if you can predict which way price is going to move. Entering a trade just before a news release can net you 30 or 40 pips very quickly if you get the direction right. But predicting which way price is going to move is very much a gamble, so most traders do not trade the news, as its just too risky, and you often get stopped out, as price quickly moves one way, and then the other. This type of move is known as a whipsaw. Most traders have experienced this whipsaw effect, when price goes up then down very quickly, and it seems no matter which way you trade, you always seem to get stopped out.

Now i look at the charts in a very different way to 95% of traders out there, and i can always see an opportunity in whatever the market throws at me. When you understand why the market moves as it does, you can profit from almost any trading scenario, and trading the news can also be a great opportunity to profit from the market.

A strategy for trading the news is probably one of the hardest things to develop, but if you understand what is happening to price then its a lot easier. Now i am not going to go into the ins and outs of price action, and how i use it, but i would like to give you a simple but effective strategy for trading the news. This strategy can give you over 100 pips profit on a major news release if used on multiple pairs.

Now the big problem with developing a strategy for trading the news is stop losses. When most traders enter trades they set a stop loss. That stop loss could be anything from 10 pips to 30 pips, or more if you are trading higher time frames. Now if you are trading the news on the 15 min time frame, and you set a stop loss how big should it be? 10 pips, 20 pips, 30 pips, more? It is very difficult to set a stop loss for a news announcement, as you don’t know how big the move is going to be? So if you don’t know how big the move is going to be, how can you set a stop loss? You can set a stop loss above a recent high, or below a recent low, but a big whipsaw like the one in the screenshot below will still wipe you out. So what do you do? How do you profit from a move like that? Well the trading strategy below will describe what you need to do to make money from a news based whipsaw move.

If you think about what happens in a whipsaw, price goes up, stops out short traders, price goes down, stops out long traders. Now you know price is going up, to stop out shorts, and you know its going down to stop out longs, so this is what you do. You enter two trades, one long, one short, as close as you can to the the mid price of the move that leads up to the whipsaw. If you look a the screenshot above, this would be the middle black line. You set a take profit on both trades of 15 to 20 pips. You can go for more pips if the news is big, and you are going to get a bigger whipsaw, an interest rate decision for example, but 15 to 20 pips is a safe amount to go for.

Now the important part of this strategy is NOT to set a stop loss. Your take profit becomes the stop loss. Most traders will be trading this with a 20 to 30 pip stop loss, you trade it with a take profit instead of a stop loss. Price goes up, hits your take profit, price goes down hits your take profit. As price is hitting other traders stop losses, its hitting your take profit. But because you are trading without a stop loss, it does not matter which way price goes first, you are not going to get stopped out, you are only going to get your take profit hit. Does that make sense? Read it again if you are unsure.

Now there are a couple of important things you need to be aware of before you use this type of strategy for trading the news. The news release must be a high impact release, ( you can check which news releases are high impact on the calendar on the homepage ) NFP, interest rate decision, FOMC etc. A high impact news release is much more likely to produce a whipsaw move. The market also has to be moving in a tight range before the news is released. Check the screenshot above for an example of what you are looking for. This is VERY important. When the market has been moving in a tight range before the news traders stop losses are in easy reach of the whipsaw. If price has been going up, or going down before the release, then the whipsaw is less likely to happen. If you have the tight range that you need, you must enter as close to mid price as you can, so you are not exposed at the end of the range. If you are, your 15 or 20 pip take profit may not get hit in both directions.

Something else you can do to maximize your profit, is to trade this strategy on more than one pair. If the news is euro related, trade all euro pairs, if its dollar related, trade all dollar pairs, if its Yen related, you get the idea. As long as you have the tight range you are looking for before the news release you can trade any relevant pair. Trading more than one pair will also spread your risk, just in case you do not get the whipsaw on all the pairs. As long as you get it on the majority of pairs you will still make plenty of pips, and your take profit will get hit one way or another.

Please note: I am not a news trader. The strategies i employ for trading are low risk high probability trading strategies. A lot of my trading is based on chart logic, and this strategy is a logical way to trade the whipsaw on this type of news release. If you are a news trader then this strategy will hopefully help you understand the whipsaw, and how to profit from it. If you decide to use this strategy or not, i hope its been enjoyable reading, and made you think about the market a little differently. Making money from trading is all about understanding what is happening on the chart, and thinking outside of the box. 🙂

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How To Find The Best Forex Trading Strategies.

December 22, 2013January 10, 2020Rob Taylor

Apologies for not posting for a while, but i have been really busy with new students. As Christmas is nearly upon us and the markets are pretty quiet, i thought i would write a post about how to find the best Forex trading strategies.

Can you really find a great Forex trading strategy?

Every Forex trader is looking for a great Forex trading strategy, but finding something that works consistently well, is very difficult for the average retail Forex trader. There are 100’s of strategies you can use to trade Forex, most will fail miserably, but with strict money management, you may find a few that you could make some money with.

The problem with the majority of Forex trading strategies that are employed by retail traders, is that they are based on beliefs about the Forex market that are inaccurate. So a trading strategy based on those beliefs cannot be successful long term.

How do i trade?

I am a very matter of fact trader, and i trade a rules based method, based on a complete understanding of the market, and advanced price action trading. I enter and exit trades at key reversal points to maximize profitability, and to minimize losses. Forex trading as far as i am concerned is very black and white. I don’t waste my time trying to find strategies that work. You really don’t need to do that. All as you need to be a successful Forex trader, is a complete understanding of how the market works, and the ability to read the chart. I have that understanding and ability, and i trade very successfully based on knowledge, rather than weak retail trader strategies.

There are only really 2 ways to trade as far as i am concerned. The right way and the wrong way. On one side of the fence you have retail traders, or the 95% as i like to call them. And on the other side of the fence you have the professional Forex traders, or the 5%.

The 95% waste years trading and back testing 100s of trading strategies, strategies that are never going to work long term, as they are based around rules and beliefs that are inaccurate. The 5% know how to trade, so they spend all their time trading and making money. Now if you are reading this and thinking “this guy does not know what he is talking about, i have been testing this really good strategy for a few months now, it just needs a little bit of tweaking and it will work just fine”, you are more than likely in the 95%, and you need to forget about back testing, and start learning. What i do works, it has always worked, and it will always work. It does not need back testing.

Finding the missing piece in the Forex puzzle.

I remember when i first started trading, it was really hard. Nothing seemed to work well enough to make money consistently. Everything i tried was not quite cutting it. It was as if i was almost there, but i just needed the last piece of the puzzle to be consistently profitable.

Now if you are in the same situation right now, i am going to let you into a little secret. You will never find the last piece of the puzzle, because the puzzle was created without all the pieces, so no matter how hard you try, you will never find that missing piece.

Traders that join my training and mentoring program often say that they need my help to find the last piece of the puzzle. When i show them how the market really works, and how to be consistently profitable, they are completely blown away, and they quickly realize that the puzzle that they have been trying so hard to complete, can never be completed.

And the reason it can never be completed is because its based around beliefs about the market that are inaccurate. So how can you complete a puzzle if the pieces are wrong to start with? When i teach my students the full story, they can then embark on their journey to becoming a consistently profitable Forex trader.

So what are your options? The education and understanding that i give traders totally transforms their trading, so the best advice i can give you is to enroll on my Forex training course, but if you do not have the money to invest in that, then i suggest you forget about trying to find the best Forex trading strategy, and concentrate on studying charts.

All the information you need to be successful in trading is in the chart. Study the lower time frame charts like the 5 min and the 1 min and see how price moves. Its not going to be easy, and it could take you 1000s of hours of study, but i can honestly say that time you spend studying the smaller time frame charts, will be far more benefit to you than back testing weak Forex trading strategies.