Currency correlation measures the extend in which two individual currency pairs move in the same or in opposite directions. It´s usually expressed as a percentage, from -100% to +100%. Positive correlations (from 0% to 100%) indicate how much two pairs move in the same direction. Negative correlations (from 0% to -100%) indicate how much two pairs move in opposite...
TEST YOUR TRADING SYSTEM
I will not go deep into this, because it quickly becomes a shouting match on who has the best system, which is usually more about ego than fact. It is sufficient to say that I have seen / know of profitable traders who use fundamentals, price patterns, Elliot waves, renko, moving averages, structure levels, pitchforks, trend rules and...
Imagine you have a strategy and you found that the optimal risk you should take is 4%.
In other words with this strategy you should put 4% of your capital at risk in every trade to grow your account the fastest.
If you enter a trade with 100% of your capital, the SL % is the % you put at risk. NOT the whole position size. So by entering a trade with all of your...
As we all know, when we open a trade, there is no guarantee it will be a winner. Given the win rate of a certain trading strategy, there is a random distribution between wins and losses. We trade to make money over a larger number of trades, not to win every individual trade, which would simply be unrealistic. That is why it’s important to be confident when we...
