Trading Strategy Lecture Notes

Introduction

• Earning Potential: Made over $9,400 in 30 days, trading less than 90 minutes a day, 4 days a week.
• Content Overview: From trading basics to the exact strategy used to grow a small account.
• Transparency: Sharing complete strategy without cost, unlike many others.

Understanding Trading

• Expectations: Trading success takes years, not weeks.
• Progression: Starts with small trades, grows with experience and increased risk.
• Analogy: Similar to becoming a doctor; long-term effort pays off.

Initial Steps

• Starting Capital: Can start with as low as $500.
• Demo Trading: Recommended to practice without real money.
• Consistency: Key to becoming profitable; avoid jumping between strategies.

Trading Basics

• Charts & Candlesticks:
  • Green Candlesticks: Price increased.
  • Red Candlesticks: Price decreased.
  • Time Frames: Can be based on time or volume.
  • Patterns and Trends: Similar across all time frames.
• Trends:
  • Bullish Trend: Higher highs and higher lows.
  • Bearish Trend: Lower highs and lower lows.
  • Sideways Trend: Market moves sideways.

Market Movements

• Supply and Demand Concept: Price movements reflect supply and demand.
• Support and Resistance Levels: Key areas where price often reverses.
• Trend Lines and Channels: Visual representation of market trends.

Trading Strategies

• Reversal Patterns: Double tops/bottoms, Head and Shoulders.
• Continuation Patterns: Bullish/Bearish flags.
• Candlestick Patterns: Indicate potential reversals or continuations.

Trading Timeframes

• Large Time Frames: Best for holding over days.
• Small Time Frames: Suitable for day trading; quicker trades.
• Personal Schedule: Tailor trading time to personal life.

Risk Management

• Risk to Reward Ratio:
  • Example: Risk $100 to make $300 (1:3 ratio).
  • Importance of maintaining favorable ratios for long-term success.

Trading Psychology

• Emotional Control: Critical for consistent profitability.
• Journaling: Track trades and emotions to improve.

Trading Assets

• Stocks: Low leverage, day trading restrictions.
• Options: Complex, high leverage but risky.
• Futures: High leverage, simpler than options.
• Forex & Crypto: Similar leverage but beware of non-regulated exchanges.

Trading Platforms

• Suggestions:
  • TradingView: Good for global access and charting.
  • NinjaTrader: Specialized for futures.
• Demo Trading: Practice without risking real money.

Order Types

• Market Orders: Immediate execution at current price.
• Limit Orders: Execution at a specific price.
• Stop Orders: Trigger a market order when a price is reached.
• OCO Orders: One cancels other for managing risk.

Avoiding Pitfalls

• Prop Firms: Can be a trap; focus on learning first.
• Alert Services: Not a substitute for personal strategy.
• Scam Awareness: Verify trading results; avoid scams and fake platforms.

Personal Trading Strategy

• Focus on Reversals: Trading off supply and demand levels.
• Time Frame Use: Enter trades on lower time frames, identify levels on higher ones.
• Example Trades: Look for clear confirmations before entering.