I believe that taking back-to-back patterns is one of the hardest feats to overcome in trading. Let’s think about this for a minute. You’ve just taken a pattern, dealt with a little bit of pain as the market churned for a while only come out the other side with profit. Typically at this moment a trader would like to sit back, relax, let out a sigh of relief and maybe tap themselves on the back for following there plan and reaping the benefits. Let’s admit it, we trade in the toughest market out there and winning is a very difficult thing to do. However, instead of getting time to celebrate and refocus another opportunity appears going the exact opposite direction of your initial trade and the first thing that comes to mind is what? “______”
“No way is the market going to reverse again already. I should just skip this trade so I don’t give back any profit.” Obviously, sometimes this will work in your favor but remember our job as pattern traders isn’t to guess which will be successful and which will not, our job is to execute every valid pattern that we see even if it’s very difficult to do mentally. However if you can pull it off it’s a great reminder of why we have rules and how the markets reward those who follow them
This particular trade yielded close to 200pips total to a trader using 2 positions on multiple targets. Yup almost 200pips total on a 15 minute chart. I tell the clients I work with all of the time, “if you’re going to be a day trader stick to watching 4 pairs. Maybe 6 max.” Many think that it’s impossible to be profitable without a massive portfolio. Hopefully scenarios like this will provide a great example of how it’s not about the quantity of pairs you watch it’s the quality of how you can trade the ones that you do that matter most.
Chief Currency Analyst at http://www.TradeEmpowered.com
Akil@Tradeempowered.com /@AkilStokesRTM /
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I also agree whole-heartedly about limiting your portfolio. 90% of the time I spend trading is only watching the major crosses. Only occasionally will I place any trade on the minor crosses. I keep an eye out on them but don't actively trade them for the very reason you stated. Plenty of trades available just with the majors! I think a lot of people just have it in their head that they don't want to miss out on a potentially good trade in another market. It's the "grass is greener" effect. Besides, I only have 2 20" monitors in front of me! Not enough room to watch so many pairs! ;-P
Great job as always, Akil! Love to read your stuff!