Invest FX

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This plan is not designed to remove the thinking from your trading but rather it is merely to show you how effective and simple a trading plan can be as long as it is adheres to the core principles that I teach.

This example trading plan incorporates multiple confluences to give lots of confirmation both in direction and entry levels; due to this I have named it the safe trade.

Example: – The “Safe trade”

To get our direction we are going to use 4 hour and daily market flow, and our daily Pivot point trading zones as confirmation.

So if price is above the main daily central pivot we will be looking to short that pair if it is below the main daily central we are looking to go long but only if the trade is in line with 4 hour AND Daily market flow i.e. they both agree on the same direction.

So before we take any trade we will have a confluence of factors determining which direction we will be trading in.

Here’s a chart example so far:

In this example we can see that 4 hour and daily market flow says down, plus price is just below our sell zone which begins at the main daily pivot (pink line).

Now we can identify easily and quickly which direction we will be trading in we need some entry points.

For this we will use the daily pivot support and resistance levels as our anchor.

So if we know we are going short, we would look to the Daily pivot resistance levels as possible places to take a sell from.

Next we need a confluence of reasons to actually take a short trade from a Resistance level.

If we plot a Fibonacci onto the 15 minute chart wave we can see a nice confluence at the Central pivot point with a 50% Fibonacci retracement level and a recent level of resistance.

Let’s see how this looks:

That’s 3 different reasons to use that level as a Resistance….on top of the fact that we are in a confirmed selling zone!

This is a great confluence of reasons to go short from the daily central pivot.

So now we are going to place an entry order with our broker, to go short as soon as price hits our level of resistance…and we are also going to use a 40 pip stop loss.

Let’s take a look at what happened as price came up:

So we can see here that the price reacted right off our expected level of Resistance and proceeded to go down from that point almost immediately.

The beauty of trading from confluences of support and resistance is that we are expecting the price to react right off that exact level meaning that our stops can be much smaller than in most other types of trades.

The other benefit is that you usually end up catching most of the move.

The next thing we need to do is look for an exit.

To do this we are going to once again keep things really simple so as soon as we get into the trade we will keep our initial stop loss in place until we see a new fractal form in the direction of our trade on the 15 minute chart, at which point we will move our stop loss to the tip of the new fractals.

We will then set our take profit at the Fibonacci extension level (127%), and just follow the price down with our trailing stop loss.

So one of three things can happen, we get stopped out for a small loss, we get stopped out for a small profit, or the price hits the extension and we make a maximum profit.

Once you decide that you like your plan the next thing you just want to check is that it adheres to the main principles that I use throughout my trading:

• You are trading with confluences (both in direction and entry)
• You are trading from Recognized Support and resistance levels
• It is a simple and easy to follow method
• You are trading what you see in the price using market flow and price action as your main price derived indicators.

Once again this is just an example of how to keep your trading simple whilst using the correct tools and adhering to the most important principles that I teach.

Notice that I haven’t crammed our plan full of every possible tool I have just selected a few but also notice that we haven’t limited ourselves to one minor timeframe I am also keeping in line with the higher timeframes to give our trades strength, it is important that you do the same when coming up with a trade plan that suits you.

If you require help or guidance when formulating your own unique trade plan, don’t hesitate to get in touch and I can help you get to where you want to be.

I sincerely hope that you have found this material useful and that it can be the catalyst to a long and prosperous trading career.

Next: Congratulations!