2-25-2013 – Trade Summary
Total Pips = +429 pips
I promised in our trading room to write an article about the reversal candle and a fast review Forex Candlestick and Reversal Day Trading Strategy today. We booked some nice pips in the U.S. session today (+429 pips) as markets sold off in a harsh manner. We were prepared and took action!
Quick Day Trading Strategy
In some cases I have found that a Forex day trading strategy can at times be a very profitable and effective method of trading. Of course this strategy should be performed only by an experience day trader since trading against the trend requires a good sense of market knowledge and day trading skills.
In working in Day Trading for over 14 years I have found that with certain criteria I can indeed get an ‘edge’ from using methods that appear to present themselves in the markets from time tom time. A good forex day trading reversal strategy is one that can indeed allow you to get a high risk reward ratio but normally has a very low winning percentage, since it against the trend. One reason is it is simply difficult to know when the market will have a reversal. I must admit, I do like these type of trades, but they can be dangerous for the novice. I have made a video to show you a nice candlestick formation that is one criteria that may help in a reversal trade. If you notice I look on the 4 hour chart for a reversal candle as this is more reliable for me even on intraday chart trades. Since the 4 hour chart presents itself as a chart that can be used by both swing traders as well as day traders, I feel it is a good time frame to check prior to looking into any day trades.
I want to mention again that most counter trend trades are quick to continue and many will be stopped out. If you have the plan to stay in if it goes your way then you may see this method of trading as a reversal day trading strategy.
Here is the fast video I made to recap our forex day trade today. This was taken based on a forex candlestick pattern on the 4 hour chart. I will make more videos on Forex candlestick trading in the next few weeks to come.