Trading Educators Blog
Q&A - Questions from a Student in Europe
Q: Hello! I bought the Trading with More Special Set-Ups Webinar Recording. Do you think it's a good idea to trade on EURUSD, GBPUSD, USDJPY, AUDUSD, USDCAD, EURGBP on 1h chart with the rules given in the webinar?
A: Yes, you can trade all Forex with the special setups. As a matter of fact, you can also trade futures, CFDs and stocks with these same rules.
Q: Take Profits 1:1 or 2:1 - which will be better? Maybe time stop? Maybe when risk to reward is >1 then take profits on the Moving average?
A: When risk to reward is > than 1 it is a good idea to take profits as quickly as you can, but you must test to see which way gives the best result. You may find that different rules work the best for different pairs. Don't be afraid to experiment. Using a time stop can be psychologically difficult. If you are a beginner avoid using time stops until you can prove that you are a consistent trader winning more money than you lose.
Q: Stop Loss one tick above the reversal bar for short and one tick under reversal bar for long?
A: Stop Loss one tick above or below will work ok. Some traders place the Stop Loss directly at the high or low. Again, see which way works best for you.
Q: If I understand correctly, I can change four parameters: Take Profits, Stop Loss, Bollinger Bands settings and Stochastic settings? How many trades do you make for a backtest? When do you decide to change something in parameters?
A: Yes, those are the parameters that are used for settings. For backtesting I never go back more than 50 trades. 40 trades are statistically valid, so I often use 50 to be sure. You want to always be using the most recent data. I change parameters when I see that what I was doing is no longer working.
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