Trading Plan

Trading System Core

This is EOD trading plan. It trade off daily chart. It only enter specific, well defined PASR that goes along with monthly direction.

In scenario when monthly chart closed around SR, Weekly chart will be observed. Any PA reacting to the Monthly SR will be the direction that daily trade have to goes along with.

Risk Management

It will trade off a demo account. The trade will have 2 % risk ignoring swap. Account risk will be capped at 10%. The risk reward should have minimum of 1:1, though it would most likely be higher than that in most scenario.

Analysis Summary

Monthly Direction

A clear PASR pattern will instantly decide the change of price direction. They include shooting star, hammer, OB and EB.

If the closed month candle is running toward one direction that is along with previous PASR direction, the direction continue.

If the candle does not goes along with previous momentum, whether the price direction is continue is determine by whether it have a clean trend line break.

If the price close on SR, it is currently not in direction, and weekly chart need to be observed. If weekly chart consist of PA reacting to monthly PASR, the monthly direction will be decided by this weekly PA for the next couple weeks.

If the monthly chart are in control candle more than 2 months, there is no direction for this pair and weekly chart will not be observed until it break out, or forming a clear PASR (which is way larger than control candle range).

Daily Entry

  • A PASR off a Strat Shadow or 200ema, including a Strat Saddle
  • A PASR off a previous swing high/low, practically an SR

Entry Strategy

There will be 2 trades per entry. 1 % risk each. SL will be last swing end, or 2x ATR, depend on whichever closer.

It will be a market entry instead of stop entry after the high/low of the candle. Reason being, it is a trade that goes along with monthly direction.

Exit Strategy

One will exit when trade hit the next SR/BRN/swing end depend on whichever closest.

Second will trailing exit off Strat Shadow/SR when reverse PASR is formed.

Hard exit when monthly chart closed at monthly SR.

Trade Routine

Every new month, I will be redraw monthly SR. There will be a slightly bold SR which is from big monthly swings. A smaller swings will form a thinner SR line.

Then, determine what is the monthly direction based on analysis summary above.

Every morning, 30 minutes after the new daily candle close, I will check if there is anything that fit daily entry. Only trade when it fit, and goes along with monthly direction.

Reevaluation

The next reevaluation will be on July 1st. The reevaluation criteria including but not limited to as follow:

  • Is daily routine followed
  • Is there any trade that not following the trading plan
  • Is there any entry that should be taken that is not taken
  • Is the analysis too complicated or simplified that the chance goes against me
  • Anyway to improve my trading result without over-burden myself

Forecast

There should be averagely a trade every 20 trading day, on the pairs that have direction, based on the back-tests.

So, by July 1st, I am likely to have roughly 30 trades. So, patience is needed since it is not a large amount of trades going on.

I am likely to get cheeky and enter something without following the rules. So, to prevent that, I should have make a blog post every trading days to keep myself accounted on my trade.

I shouldn’t spend too much time on analysis since every part of my analysis can be answered with yes or no without vagueness. If I start spending too much time on analysis, that’s when something goes wrong. I’ll need to be aware of that.


Updated 20th April 2020

Old Trading Plan