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forex trading strategies

HOW DO YOU MAKE MONEY TRADING THE MARKETS?

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HOW DO YOU MAKE MONEY TRADING THE MARKETS?


By Ivo Luhse


Watch the 6-minute video below to learn the 'secret' mathematical formula that makes BIG money for Professional traders (and Casinos) while all the novice traders just chase the winners and end up being broke.

Will your trading strategy make money long-term? Are you trading a strategy that is doomed to fail? Using DARA Strategy Expectancy Simulator you can discover strategy profitability before its too late.



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The Importance of Keeping a Trading Journal


Author: Shanda Biggs


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In todays post we are going to discuss the importance of keeping a trading journal. A trading journal is a critical component to your overall trading plan and future success.

In any endeavor that you have ever gone through, you cant expect to keep all the information in your head. Take going to university, you cannot expect to get good grades unless you retain the information you hear on a day to day basis. Inevitably you will write some things down, refer back to those notes and then learn from them. 

The same is true for trading. In order to consistently grow as a trader you must have something to measure your progress and keep you on track. This is what a trading journal does. It is a tool that allows you to document every single trade and action you take within your trading account. Such as setting take profits, stop losses and trailing stops. The more you measure, the more you can fine-tune your approach and become a better more consistent trader.

In saying this, there are 3 main things that keeping a trading journal can help you with and we are going to discuss them in greater detail below. But to outline them now, the 3 things are REVIEW – LEARN – GROW.

Every successful business keeps documentation of the work that they do. Progress reports are essential to a company’s growth. It gives the company something to measure their performance by and helps them to fine holes in their current strategy, make improvements and do better on the next project.

This is exactly how you should look at keeping a trading journal. It is essentially your report card. You can measure your success and then make improvements. The more in detail you measure your trades, the more in depth you can fine-tune your approach. 

With that beings said the first point we want to touch on is…

REVIEW

 By documenting all of the details of your trades you are able to do an in depth review of the trades that you take. Things to keep track of are

- entry date

- exit date

- entry price

- exit price

- trade management details

- slippage

- commission

- strategy

- profit/loss

- original target

- notes

Of course do not be limited to this list but these are just some ideas that can get you started on the right foot. By consistency reviewing your trades you are able to see where you may be falling short with your trades.

For example, if you keep track of your original take profit levels and where you actually exited the trade, you may find through careful review that you are closing out positions early that ended up going to your original take profit. This can be very powerful because by simply reviewing all of your trades you are then able to make these changes that can have a huge impact on your results.

Reviewing your trades is essential because by reviewing your trades you become more aware of what your best trading setups look like. When you know what your best setups look like you are able to execute the trades easily and effortlessly.

Other important details to include in your trading journal are screen shots of each trade and detailed notes on why you executed the trade, what the setup looked like at the time, why you managed the trade in the way that you did and why your take profit and stop loss levels were set in the way that they were. These notes are essential to fine tuning your approach. You may find after a large enough sample size that you are not great at executing a particular strategy. You can than make the decision to not trade the strategy entirely or fine-tune it in a way that suits your trading style.

LEARN

The only way to learn from your trades is by careful review. After reviewing all of your trades you are than able to pick out similarities and differences between great setups and not so great setups. By doing this you can tweak your approach and implement action steps to ensure that you do not make the same mistakes twice. When you see a mistake being made multiple times within you trading journal you can than write that mistake down to ensure that you do not make it again.

For example, “I find that pinbar candles in a down market that close as down candles to not make for great buy signals.” By making these observations in your trading journal you can greatly improve your consistency with executing the same great setups time and time again.

GROW

 By carefully reviewing and learning from all of your trades you are able to grow as a trader. Growth only happens by learning from previous experiences and this is exactly what keeping a trading journal allows you to do. You are able to sort through all of your previous trades in an efficient and effective manner. When you identify that you are making the same mistake within your trades you can then put a rule into your trading plan so that you do not make this mistake again. This is how we grow as traders, by careful and consistent review. Keeping a trading journal is an absolute must for all professional traders. This is why we have developed a cutting edge trading journal for those involved in our DARA trading program.

If you want to be a professional trader you must do what professional traders do. They all keep journals and this is why you must as well! We make it easy for you to review your trades, learn and grow as a trader! This is why we are giving away our amazing Journaling DARA software package for FREE. With this software you are able to review and analyze your trades in great detail. All you have to do is create a free account and download the software package.

 

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Why Discipline in Trading is SO Important


Author: Shanda Biggs


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I have learnt over the last number of years trading that there are a handful of things that make traders successful. I found a quote that I would like to share with you that outlines one of the most important, if not the most important thing that allows traders to sustain success in the markets.  

“Suffer the pain of discipline, or suffer the pain of regret”

This quote is simple and to the point. Practicing discipline on a daily basis is so important if you are a trader. It simply means that if you are not disciplined, you will not be a successful trader.

It is so important that we do not get caught up in the hussle and bussle of the market.  The market is a fast paced and exciting environment to be in. If you are not careful, the excitement can consume you to the point where you experience massive highs in your emotions while trading as well as lows. It is our job as traders to keep our emotional spectrum in check while being involved in the markets. We want the pendulum to be in complete balance. This allows us to look at the markets objectively and not through the lenses of our emotions.

Have you ever wondered what truly makes great traders successful? It has everything to do with the above quote. Great traders have incredible discipline. They have the discipline to take great trading setups but also to stay out of bad ones. 

They understand that sometimes the most profitable position is not being in a position at all. Yet they also know when to take action. They become masters and students of the game. 

Before you can be a disciplined trader you first need a vision. Why did you start trading in the first place? What drew you to the markets? Do you want to create freedom in your life? Develop and learn a new skill? Whatever the reason is. Be sure that you are clear. Nothing stops progress like a cloudy vision. When you have a vision and see where you are going and what you need to do to get there is when you take the action steps necessary to walk along the path. 

Create a vision for your trading and for your life and see where you are going and what you need to do to get there. Then you will take the necessary action steps to bring the goal closer to you.

How do you develop a clear plan to get to your trading goals?

One of the best goals I have set for myself and I recommend that you set as well is… making it a goal to follow the rules of your trading plan everyday. If you can do this one simple thing I guarantee you will see success in the markets. Creating the habit of following your trading plan increases your discipline.

One tool in particular that has helped many traders stay disciplined in the market is the use of algorithmic trading robots. These bots help keep the trader on track by only executing trades that are according to the trading plan.

Where many traders fall short is they do not have the discipline to follow their plans. Even a small deviation in the plan can be detrimental to a trader’s long-term success. Why?

Making small changes to your plan on the fly is trading based on your current emotions at the time. Someone who is disciplined would trade their plan no matter what. A trader making emotional decisions changes the plan from trade to trade and wonders why they are not improving.

Trading with robots helps you to not get caught in the heat of the market. It helps reduce emotional trading. You do not have to question your setup, you just execute because the bot tells you that there is a great setup available. Then overtime by following your plan, your edge presents itself.

Not following a set routine is why most traders are not improving. When you make changes to your trading plan on the fly you are not basing your decisions on concrete rules and data. If you have the data and back testing proof to backup your decisions, then you can make changes to your trading plan. But until then, stick with the rules you have set out for yourself. Only making real changes once you have the proof that the change will benefit you in the long run.

I have learned that keeping your trading plan concise and to the point is most beneficial. By having a focused trading plan you know exactly how to execute each and every position that you take. When your trading plan is focused, it is easier to be disciplined. You know what you are looking for and can execute accordingly.

A trader can have a HUGE advantage by using robots to aid in their trading. Many traders fail due to their poor psychology and mindset. If trading with the assistance of a robot could help you develop the discipline to be a successful trader than it would be a no brainer. That is exactly what robot trading will help you with. Being more disciplined! Allow trading with robots to help you follow your trading strategy!

At Evestin Forex we have developed some pretty great trading robots! We discuss each strategy that we trade in great detail in our FREE ebook. Click the here to download your FREE copy!

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Automated Trading Systems Do Have Character


Ivo Luhse

By Ivo Luhse, robot trader & founder of Evestin Forex - Follow me on social media:


Why do we make the claim that our trading robots have character?

It’s because our trading robots use real manual trading strategies professional traders use. Unlike a majority of automated trading systems (trading robots) that are created with lagging indicators and past price action (fitting the price curve), our robots have been coded to trade manual trading systems I’ve personally been trading with since 2012.

The trading strategies we use for our robots are not the latest new thing. In fact, they’re tried, tested and true – manual trading strategies that have worked for decades well before Evestin Forex robots where created. All these trading strategies work with or without automation. All we’ve done is taken these trading strategies and automated them so anyone can use them.

Thanks to automated backtests we now have a solid statistical proof that these strategies have an edge in the markets. This gives us a huge confidence to trade these strategies removing any guess work and emotions from trading. You can rely all your trading on probabilities and statistics. This is a very important aspect of trading. As and engineer I struggled to trade just on my mentor's recommendation. I needed a statistical proof that his strategy works. This is when I started my journey into Automated trading by creating a robot to do automated backtests for me.
And the rest, as they say, is history. I now trade only using robots and have build 4 robots I trade with today.

I’m going to lay out a detailed explanation of all 4 of the trading strategies my robots use below.

Some people on my team said I was crazy to expose my trading strategies. However, I’m like Richard Dennis, the creator of famous turtle traders, when he said the following:

I always say that you could publish my trading rules in the newspaper, and no one would follow them. The key is consistency and discipline. Almost anybody can make up a list of rules that are 80% as good as what we taught our people. What they couldn’t do is give them the confidence to stick to those rules even when things are going bad.
— Richard Dennis

By providing a detailed explanation of the trading strategies our trading robots use, I believe is the only way you’ll be comfortable trading them and have the confidence to stick by them even during the rough times.

Meet our robots

Satoshi

Satoshi EA

Satoshi robot trades using Japanese candlestick patterns.  I first learned about Japanese candlestick patterns from my mentor Andrew Mitchem

I immediately saw the great potential in trading using candlestick patterns, as they gave me easy to spot visual clues about the market’s direction.

Candlestick charting first appeared sometime after 1850. Much of the credit for candlestick development and charting goes to a legendary rice trader named Homma from the town of Sakata. It is likely that his original ideas were modified and refined over many years of trading eventually resulting in the system of candlestick charting that we use today.

There are more than 30 different candlestick patterns but this is not a lesson about candlesticks. All you need to know is that Satoshi trades only the four highest probability reversal patterns:

  • Hammer - Bullish reversal pattern

  • Shooting Star - Bearish Reversal Pattern

  • Bullish Engulfing - Bullish Reversal Pattern

  • Bearish Engulfing - Bearish Reversal Pattern

For these patterns to be valid, the market has to be in a clearly definable uptrend/downtrend…even if it’s a short-term trend.

To define a trend, Satoshi uses Bollinger bands and will only take reversal patterns if they appear at or near the Upper Bollinger band for Sell trades or near Lower Bollinger band for Buy trades.

Unlike the Stock market, the Forex market rarely trades in strong trends. This makes the Japanese reversal pattern strategies an ideal fit for the Forex market.

It’s common to see the price bouncing from the Lower Bollinger band to the Upper Bollinger band and back down once more.  Majority of these bounces will be picked up by these 4 patterns - Hammer, Shooting star, Bullish engulfing and Bearish engulfing

EUR/USD Daily chart with Japanese candlestick reversal patterns

For entries, Satoshi uses Limit orders at an 80 percent retracement of the setup candle. This comes to a rounded Fibonacci retracement level of 0.786.

This is a happy medium between a good Risk:Reward Ratio and missing out on possible profitable trade.

Stop Losses are placed below the setup candle for Buy orders and above the setup candle for Sell orders.

Satoshi divides its entries into three parts to attain the most profit the market is willing to give us. Stop Loss and entry price is the same for the three orders, but there is a difference in Take Profits.

•    TP1 - 120% extension of the setup candle
•    TP2 - 160% extension of the setup candle
•    TP3 - 220% extension of the setup candle.

These levels are rounded Fibonacci numbers and also coincide with daily pivot point Support/Resistance lines S1/R1 for TP1, S2/R2 for TP2 and S3/R3 for TP3.

GBP/USD Bullish engulfing pattern Entry example

We trade Satoshi on four major currency pairs and Gold on Daily charts.

  • EUR/USD
  • GBP/USD
  • USD/JPY
  • AUD/USD
  • XAU/USD

While other cross currency pairs can be added, we stick with just the major pairs to avoid correlation. (Most days cross pairs and major currency pairs will produce very similar trades)

What to expect from Satoshi robot

  • On average 5 trades per month split into 3 parts.
  • Average Win rate of 60% 
  • Average Risk : Reward ratio of 1:1.13
  • Positive expectancy 0.28R
  • Average trade length: 5 days

Backtest results (2011-2017) risking 2% of account per trade

Download full list of trades

  • Average yearly profit: +22%
  • Average monthly profit: +1.8%
  • Maximum Drawdown: - 10.4%
  • Profit factor: 1.7

Satoshi robot stats

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Gunner

Gunner EA robot

The Forex market is unique in that it trades 24 hours a day. Before trading closes in New York, the market in Sydney reopens - 24 hours of market trading, five days a week. It closes down only for the weekends.

After more than 10,000 hours of chart watching, I noticed the market open Monday morning has specific, predictable price action.
It generally retraces against the move from the week prior, if the currency pair had a strong one directional move through the whole previous week.

This is due to profit taking that is happening after such a strong move and because traders in Asia are cautious in taking any large positions before the market opens in both Europe and the U.S. They typically wait for these markets to provide them with the direction the market is going to take for the week. It’s why Mondays tend to be very different than other days in the market. Gunner uses this market phenomenal with amazing success.

Gunner can take up to 2 trades each Monday from these two currency baskets:

  • Basket Nr1 - EUR base pairs (EUR/USD, EUR/JPY, EUR/CAD, EUR/AUD)
  • Basket Nr2 - GBP base pairs (GBP/USD, GBP/JPY, GBP/AUD, GBP/CHF)

The only downside of trading during the early hours of market open is the larger spreads and market gaps. This is why it is very important to trade Gunner robot only with our recommended brokers. Other brokers can have very large weekend gaps and weekend spreads of up to 30-50 pips making this strategy untradable.

What to expect from Gunner robot

  • Most weeks 1-2 trades on Mondays
  • Average win rate of 65%
  • Average Risk:Reward Ratio of 1:1.2 (initial R:R 1:05)
  • Positive expectancy of 0.45R
  • Average trade length: 1 day

Backtest results (2010-2017) risking 2% of account per trade 

Download full list of trades

  • Average yearly profit: +19.2%
  • Average monthly profit: +1.6%
  • Maximum Drawdown: - 3.0%
  • Profit factor: 2.34

Gunner robot stats

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Fey

Fey EA forex robot

Fey is the most special robot with an extraordinary trading strategy.
She uses the W.D. Gann modified Astro-trading strategy, a practice that relates to the movements of celestial bodies to events in the financial markets.

The idea, Market Wizard W.D. Gann had, was when the Moon or any celestial bodies like planets and stars moved into a new cycle, it could have an effect on people’s minds and, in turn, affect the financial markets.
This is especially true if the price had a strong trend when the moon changes cycles, as it tends to mean the trend can stall or even reverse.

I am not an expert on W.D. Gann’s strategies, but this method was provided to me by a fellow trader who has spent a lifetime studying W.D.Gann. With his permission, I’ve automated this strategy. I was quite sceptical at the beginning. But it was easy for me to test this strategy out since I just had to alter the moon cycle times to some random times. It was my surprise when all the random times generated negative results while the correct moon cycle times generated great profit year after year.

Fey is like Satoshi in that she uses Bollinger bands to determine the trends. She trades on the EUR/USD currency pair since it’s the most traded currency pair in the world and has the best effect for this strategy.  She doesn’t make a lot of trades per month – one to two on average.  The win rate (~36%) is low for Fey robot so you need to be disciplined and patient when trading this strategy but the Risk: Reward Ratio is very good, up to 1:5 so it is very rewarding when Fey delivers these extraordinary high rewarding trades when you least expect.

What to expect from Fey robot

  • 1-2 trades per month
  • Average win rate 36%, with most trades closed for Break-even
  • Average Risk:Reward ratio 1:5
  • Positive expectancy: 1.16R
  • Average trade length: 1 day

Backtest results (2010-2017) risking 2% of account per trade

Download full list of trades

  • Average yearly profit: +8.6%
  • Average monthly profit: +0.7%
  • Maximum Drawdown: -4.1%
  • Profit factor:  2.84

Fey Robot Stats

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CABLE

Cable robot Evestin Forex

Cable is our newest addition to our portfolio. Cable robot uses the liquidity contracts between the quiet Asian session and the very active European session. While you can trade the Forex market 24 hours a day, not every hour in the market will be the same. The Forex market has 3 very distinctive trading sessions Asian (or Australian) session, European (or London) session and US (or New York) session. And each of these sessions will have different activity levels for different currency pairs due to the local currency supply and demand, international trade routes and central bank locations.

The two Currency pairs that you can see the biggest differences are GBP/USD and EUR/USD These two currencies will be very quiet during the Asian session and typically trade in a tight range as there is just no demand for these currencies in Asia. But then in the European session, these currency pairs are the most traded and very active. If you ever heard of London breakout strategy you will know what I'm talking about. Cable robot uses a variation of London breakout trading strategy. But instead of looking for breakouts Cable robot trades reversals in the Asian session 2 hours before London open. The idea is that since there is no demand during Asia for these currency pairs any breakouts before London session will be reversed.

Cable robot is our most active robot taking trades nearly every day. However, Cable robot needs good activity during European trading sessions so if there is no activity (moves smaller than 100 pips) Cable robot will be paused until the high activity in the markets is back.

What to expect from Cable robot

  • One average 1 trade per day when Average Daily Range on EUR/USD and GBP/USD is above 100 pips.
  • Average win rate 75%
  • Average Risk:Reward ratio 1:0.6
  • Positive expectancy: 0.2R
  • Average trade length: 2 hours

Backtest results (2010-2017) risking 2% of account per trade

Download full list of trades

  • Average yearly profit: +9.3%
  • Average monthly profit: +0.8%
  • Maximum Drawdown: -4.5%
  • Profit factor:  1.76

Cable Robot Stats

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Robot Dream Team

Best forex robots

While every one of our trading robots is an excellent trading robot based on a solid, proven and tested real life manual trading strategy. The real magic happens when you place all of them in a single portfolio to trade on one account. Allowing robots to work in a team spreads the risk, reduces the drawdown periods and improves the returns.

When market phases change from trendy to range-bound markets your robots will perform differently and if you only trade a single trading strategy or a single robot you can endure prolonged drawdown and stagnation periods until the market phase changes again to favour your one trading strategy or one trading robot. But if you trade with multiple robots, like we do here at Evestin Forex. Each with totally different trading strategy, each with its own strengths in different market conditions. This robot dream team will cover for one and each other. If one robot is underperforming under certain market conditions other robots will make a profit.

This is the real secret how professional traders spread the risk across multiple trading strategies and achieve the consistent results with controlled risk. Don't make a mistake many traders do by placing all your eggs in one basket or trying to predict market phases in advance. No-one can predict the market!  Creating a portfolio of multiple robots to diversify your trading will ensure consistent growth in any market conditions year after year. 

Evestin Forex Portfolio of Four robots Backtest results (2010-2017) risking 2% of account per trade

Download full list of trades

  • Maximum Drawdown: -10.2%
  • Longest stagnation period: 133 days
  • Probability of a losing month: 20%
  • Largest profitable month: +19.5%
  • Largest losing month: -5.5%
  • On average 20 trades per month
  • Average win rate 68%,
  • Average Risk : Reward Ratio 1:08
  • Positive expectancy: 0.25R
  • Profit factor: 1.91
  • Average yearly profit: +59%
  • Average monthly profit: +5%

Evestin Forex Portfolio stats

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TRY EVESTIN FOREX ROBOT PORTFOLIO ON YOUR OWN ACCOUNT 

 Try our 4 robots on your own Live or Demo account for FREE. We give full unlimited 30-day Free access to our trading robots and our servers. Come and check how our trading robots can change your trading. I'm sure you'll Love them.

To your trading success!

Best,

-Ivo



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Automated Trading is the wave of the future

Financial Trading used to be an exclusive elite club – only a few lucky ones could join. There were guys on the trading floors shouting and screaming all day long – making and losing fortunes. This has changed with all the advances in modern technologies.
 
Trading floors are empty and exchanges are closing down. Most trading is now done electronically using automated strategies. And, thanks to the accessibility of vast resources through cloud services, it’s far easier than ever to share these automated strategies with everybody.
 
Join the hundreds of new part-time traders using our robots… today!

Manual Trading is a thing of the past – Automated Trading is the wave of the future!

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