and to keep track of my (hopefully) progress. I'll be posting my charts every day, pointing out where I took my trades.I'm an absolute beginner, so if anyone notices I'm doing something wrong, any criticism is appreciated!
Now, with that out of the way...
I've believe the only way to get better at trading, is trading. So that's what I'll be doing (and I expect to fail a lot at first). Quoting TRO here:
"Pick a method, master it. That's all you need."
"Pick one pair and stick to it. Eliminate all the variables."
"Trade at the same time, every day, for the same length of time."
So that's what I'll be doing. I'll be trading the Buy Zone on the USDCAD, the first 3 hours of the NY open.
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I tried trading the Buy Zone "blindly" the last week, with an arbitrary 20 pip zone, taking a trade on every entry without looking at anything else. Got stopped several times, asked around, watched TRO's "why you don't get better at trading series", watched a TRO forum and video response, and what I was missing was: "The thing is, you have to look at price action". (I might have to print this and pin it on a wall
)"Price either:
- Stays within the range of the previous candle
- Breaks out of the high and/or low of the previous candle
That's price action. That's the only thing price can do.
You can't break it down any simpler, and anything else complicates it."
"Study the WICK ZONE. Wick Zones of H1 candles give you a clue which way price is moving when it enters/exits the H1 wick zone!"
"You can overlay a wickzone and trade the price action, and use the wickzone for either profit taking or scratching a trade without going to the full stop."
Essentially, I'm trading breakouts, and this means I inevitably have to look at the previous candles, and have to look at wicks to trade around price action, even within the Buy Zone.
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Trading Plan and putting everything together:
Preparation:
- Plot a line at the session start (NY Open).
- The buy zone range is determined via frequency distribution of High-Open and Open-Low over a peroid of time (ran it for the USDCAD, and it's around 8 pips above and 8 pips below the open for the H1 bars).
Rules:
- Within the Buy Zone (and/or if price exits the buy zone), I want to be long above the open, and short below the open.
- Only one trade per bar (I'll be using the 1H chart), to avoid re-entries.
- No trades outside the Buy Zone, because that'd mean that it's a late entry.
Entries:
- If price goes above the previous candle's high within the Buy Zone, I'll go Long.
- If price goes below the previous candle's low within the Buy Zone, I'll go Short.
Exits:
TPs: I know that the buy zone also has bigger runs, but for now, I'll apply TRO's recommendation for beginners: "Get good at grabbing those 3 pips consistently". So that's my aim currently. 3 net pips.
Stops: Stops will be at the other end of the previous candle's wick zone. (If the wick is really small like 1-3 pips, I'll be using the session open as my stop).
Money Management:
Risk: 1% per trade.
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This is my plan and step-by-step process. It probably won't work just like this, and I'll have to learn and improve a lot in between, but I know that at least I'm approaching the whole thing with an actual trading plan.
Thank you to those who took the time to read. Starting tomorrow!
