Trade with the trend, and look at the M15 and higher charts for trend direction. Know what the trends are doing on the H1 and H4. Never trade against the trend of the M15. The exception is to scalp quickly with the retracement s of the M15 using the M1 and M5.
1. If you prefer to trade using the smaller time frames (M1, M5), trade with the overall trend. These are micro trends. If you are a scalper, grab a few pips and close trades fast.
2. Use the human eye to detect trend changes in the smaller time frames before taking trades on the longer time frames. For example, if you trade the 15 minute chart, look at the 5 minute chart to see if the trend is strong or changing. If you trade the H1 or H4 charts, for example, look at the M5 or M15 prior to entering the trade to see any possible trend changes.
3. Repeat to yourself about the trend: “The winner keeps winning and the loser keeps losing.” Trade with the trend.
4. Look at the time prior to entering a trade. For example, if it is 9:25 p.m., it may be wise to wait until 9:30 or 9:35 to see if the trend changes. If you trade during the day, retracements usually occur a few minutes after 10 a.m., 1 p.m., 2 p.m., 3:00 p.m. The ‘7’ rule. Notice at 1:07 p.m., 2:07 p.m. what we are referring to. This ‘7’ is our observation and not a fact. And retracements/reversals often occur around the :45, :00, :30 and :15.
5. The market is quiet from 4 p.m. until around 7 p.m. This quiet time is not a good time to trade since the market is choppy. Wait until 7 p.m. The trend usually retraces a few minutes after 7 p.m. Be careful...the market usually turns back into the day’s main direction after the retracement. The trend then usually reverses in the opposite direction, which means the day’s ‘winner’ becomes th ‘loser.’
6. Do not be greedy. Take profits and be grateful. Do not overtrade.
7. Always use a stop loss. If you are a quick scalper after a few pips, it is too fast to input a stop loss, so keep your hand on your mouse and close your trades fast.
8. Trade using only 3%-5% of your equity.
9. Do not trade if you are emotional or have any drama since these issues may interfere with your decision making. Do not trade when you are tired, sleepy, hungry, upset, angry, or not feeling well. Pay attention while trading. Phone calls, texting, children, dogs barking, and other distractions interfere with thinking.
10. Not every day is a trading day. If you trade the Asian session in the evenings sometimes it is volatile and choppy. In this case, it may be best to trade the longer time frames using Forex Trend Dominator alerts option. Enjoy your dinner, spend time with your family, and relax.
11. Be patient and focus. Sometimes you must wait for a safe entry.
12. Trade during the session(s) that suits your personality or lifestyle. For example, if trading during the early New York session does not suit your personality, you may prefer to trade the Asian Session (8 p.m. EST) or London Session (3 a.m EST).
13. Know the times of news releases. http://www.forexfactory.com/calendar.php
14. Print the news calendar or jot down the times on a writing pad or notebook. Set the alarm on your cell phone as a reminder.
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