Transcript for:
Simple and Effective Forex Trading Strategy

what if I told you that there is an incredibly easy trading strategy that will make you hundreds of dollars a day in the Forex market and the best thing of all that you only need 20 Pips so this is Euro USD on a 50-minute chart and the S of profits I have recently achieved using this trading strategy so before we get into where to enter and exit to catch those 20 Pips there is something that is super important in Forex Trading and that's how your account size and pip value work hand inand to influence your trading decisions especially when we are targeting those 20 Pips a day so let's actually talk about the account size first and whether you're starting with the $100 $1,000 or even a $10,000 account each of these has a direct impact on how you should approach these 20 Pips because you know at the end of the day it's still about managing your risk wisely so for example risking 2% of your trading account means your potential loss per trade would vary significantly depending on your total account size which means you're looking at the maximum loss of $2 for a $100 account $20 for a $1,000 account or $200 for a $10,000 account respectively and when it comes to making profits you know we always want to aim for at least double what we are willing to risk which means we are risking 2% of our account on a single trade we have to set our objective to gain at least 4% profit so in Practical terms if you are risking $2 on a $100 account the profit Target would be $4 for a $1,000 account risking $20 means you are aiming for at least $40 profit and of course with a $10,000 account if you are putting you know2 200 on the line you must be looking to make at least a profit of $400 so as you can see this approach is based on a one to2 risk througho ratio which basically keeps this trading strategy focused on sustainability and grow growth and once again it basically ensures that you are always targeting for a reward worth twice the risk you are taking so given these goals and one to2 rro ratio we just talked about it's very clear that we have another important piece of a puzzle to figure out and that is the lot size for your trades and this is exactly why I want to show you this Forex time.com calculator because it's a such a handy tool all you need to do is start by entering the number of Pips you are going for so in this case we want 20 Pips then of course you have to choose your currency pair so I will go for EUR USD and all you have to do next is you kind of need to adjust the trade size and lots until the calculator shows the profit amount you aiming for so if it's not quite right just tweak the lot size until you hit your profit Target but it's that simple you just plug in your values you know just as needed and the calculator does the rest so it basically tells you how much you will make from those 20 Pips and at the same time you will know what lot size to use so now that we have got our numbers you know lined up and we know exactly what lot size we need for our trades let's actually dive into the strategy that brings it all together and the indicators we will be using for this are the Chen money flow or cmf 4 short and the 100 period moving average just for an added confirmation okay so let's add the indicators on the chart and all you have to do is click on the indicators Tab and type in cmf and it will be the first one listed over here and once you add it you will see the indicator at the bottom of your chart with a line that basically moves above and below the zero value and then of course let's add the 100 period moving average to kind of help us to capture the trends Direction so simply go back to the indicator Tab and type in moving average simple and once it's on click on this gear icon and make sure to adjust the length from 9 to to the value of 100 and of course you can change the color of your liking so it's more visible on the chart if you're using dark chest like me now you might be wondering but how these indicators can help us capture those 20 Pips every single time well the Chen money flow indicator essentially measures the flow of money into and out of currency pairs reflecting markets buying and selling pressure over a set period which is typically 20 or 21 days so for example if you are targeting 20 Pips from a potential upward move you will want the cmf indicator to cross above zero which basically signals a strong buying pressure as more money flows into the market and to strengthen the signal you have to ensure that the price is also above the moving average basically confirming a solid uptrend so this Confluence of signals is crucial because it tells us that the rally has both the volume to push prices and the established Trends backing which basically making it an the optimal time to enter a long position on the other hand for a selling opportunity you have to look for the Chen money flow indicator to dip below the zero which basically indicates increased selling pressure as money withdraws from the market and additionally you have to ensure that the price is below the 100 period moving average so let's actually take a look at one of many trades I took using this trading strategy so this is Euro USD on a 50-minute chart and this is actually the very first trade I took when I decided to test this strategy out live so the very first thing I noticed is that the overall Market direction is clearly bearish because of the price making lower highs and lower lows on the 1 hour chart so I narrowed down to the 50-minute chart and we can see that the moving average is above the price which further affirming the likelihood of a continued downtrend but what I saw next is that the current market condition for this trade had some sort of indecision going on because after this Sharp move up the price got stuck in this what I like to call Squeeze triangle shaped pattern because we can clearly see that neither of these trend lines are being broken yet we can only see rejections but later on I noticed that as soon as the money flow indicator started dropping these two consecutive bearish candlesticks broke past this uptrend and I thought okay well the overall Market direction is clearly bearish more than likely the trade will drop and more than likely it will go retest this previous bottom zone right over here so in this particular trade the stop loss was 10 Pips we are aiming double what we are risking for so 20 Pips for takeprofit which was actually just around this low over here and as you can see guys the trade nicely dropped towards the downside hitting my profit Target off 20 Pips and at the same time locking me with $200 profit now this is a super quick example of how you should consider a potential buying opportunity using this Trading strategy so in this example we can clearly see a strong uptrend in place we have multiple rejections from it we can also notice that the price action is trending above the 100 period moving average and the money flow indicator is showing us that the buying pressure is increasing you know more money coming into the market because as you can see the zero value has been crossed now when I saw this trading opportunity the only concern in this trading scenario would be just to consider this previous High Zone but since I analyzed the higher time frame the 1 hour chart I saw that the overall Market direction is bullish and there is way more than 20 pip space to move but you know I marked it just in case so I know how to react it once the price moves around this level and once again in this trade we are risking 10 Pips to gain 20 Pips my stop- loss is strategically placed below the moving average and this uptrend and as you can see by the result of this trade the price did indeed make a nice climb reacting to the previous High Zone as I marked it up and then of course catching more bullish pressure and as you can see the cmf indicator also reflects that and eventually pushing past the psychological level as well and it finally hit my take profit Target of 20 Pips so if you enjoyed this video or you learned something new then definitely let me know in the comment section down below and if you want to join my VAP trading Community where we literally dominating the markets every single week then you will also find the link in my description box down below