Good things about FX trading is that it is opened almost 24 hours per day with big volume in and out, while traders enter their trades from any time frames from 1 minute to 1440 minutes (Daily), not to mention trading from tick or volume or range charts.
Ordinary people get confused and worried asking me that if I have a buy signal and enter and many/most traders should have the same signal and also enter the buy, who is on the other side to sell if they have a buy signal ....to balance the market and so on. Despite what I tried to explain, they seem never understood.
For us as a trader, there are always 2 ways street (buy and sell) which one should we better choose to go if a TDI buy signal confirmed and next 30 minutes a short sell signal formed ? Here what is called following the trend. You would ask which trend and what time frame I am referring?
I m focusing on M30, so all I talk are about what on my M30 chart and next time frame which is H1 chart while H4 is used for break out if there is an inside bar (but be careful of fake breakouts happened quite often during Asian session). I put on M30 chart 200EMA, 50EMA for direction, that is if price above those EMAs, I only think about buying if TDI and price confirmed and only if price is below and far away from both EMAs and has divergence or double bottoms, visa versa for short sell. Levels on the chart (Yesterday High/Low, Daily Open Line, Fib levels such as 50% retrace ,etc.) and how price reacts from those levels ( pin bars, doji,) are very useful for making decision both entries and exits.
M30 signals 80% of time deliver profit of 30 pips to 50 pips for G's pairs while E's pairs move 20 pips to 35 pips. Your profit target (PT) can be increased if there is a confirmation on higher time frame which can be H1 or H4.
What is right for stop losses (SL)? and when to move SL to break even (BE). I usually have 1:1 which is if my PT is 50 pips so is my SL ( I mentioned this in trading challenges post). I found myself exit my trades if price closed below 10EMA (if I was in a buy), or if price closed above 10EMA (if I was in a sell). Using ATR (7) x 1.5 is very helpful (considering you are not greedy:-)). I don't normally let market take me out by my SL if I am available to monitor my trades, therefore, whether I have 30 or 50 pips SL does not really say that I have to bear with such losses, but rather treat it as for emergency and avoid my trades stopped out from small retracements.
Falling into choppiness is where traders get chopped out and get stressed out. I will talk more about that in my next post.
Happy life happy trading to all.