Once you know your areas and that they are anticipated to hold you must then define a set of SIMPLE and EASY to implement rules for trading these areas.
Any type of simple entry can be use but we have found that price will typically make reversal bar at a key area that is expected to hold.
Reversal bars are simple to see and easy to trade and the rules are simple and we will teach them to you here so you can see the simplicity.
In this case which is a bullish reversal, price must make a lower low, then close inside the prior bar’s range. This will complete the reversal bar pattern which is a well known price patter.
Below is an example of a bullish reversal bar that could be used to buy a key support area that is anticipated to hold.

If you cannot view the example above, go here.
You must practice these setups under several different types of conditions, smaller timeframes, larger timeframes and everything in between. This will help you to become familiar with yourself. Understanding your own personality is important when trying to determine if you have the discipline and speed to be a short-term trader or if it is more to your advantage to use larger charts for slower longer moves.
The best way to practice this method is in a live market condition. In the Nexgen training rooms we not only talk about the expected outcomes of each indicator but we talk about the trade setups before they happen.
Any type of live market learning environment provides traders with real-time feedback to their education and a forum of many like traders to also learn from. In this forum the education is accomplished by drawing on charts to make sure the process is right before thoughts of real trading can be attempted.
The final step is to start your trading success is to trade this method on a simulated account. This will help you to establish a baseline of performance that you can quickly and accurately determine if your live trading is in line with your simulated trading.
For example, if your education, testing and simulation generates 70% winners and a 2:1 reward to risk ratio over the course of 200 trades, you can quickly evaluate your last 10 trades, once you go live, to see if your inside that window or falling outside of that baseline performance. To continue your education and to further solidify your gains, you can work with an educational specialist from Nexgen to fine-tune your education or post charts in the Nexgen Advanced room for immediate feedback from the educators.
It is essential not to skip this step, as it is the blueprint of how you build confidence in a methodology. Without a firm understanding of the risks and the reward potentials and what your own hard work should generate for you trading live money is usually a losing proposition. Confidence in your methodology is a must for successful trading.
If you complete these steps you have done several very important things. One, you have built confidence that your methods and executions of that method should produce winning results. Two you will have a firm understanding of the loses that are involved with trading the method. Finally, you will have a solid foundation from which you can slowly build your financial independence.
Remember, your applying for a multi-million dollar a year job, make sure you give yourself the best chances of landing the job and being the best you can be at it by putting in the hard work and time needed to be successful.
Most traders think that just because they have bought software or tools and say they are going to be traders that they are entitled to some rewards. The truth is that buying software is not an entitlement to financial rewards. It is just the first of many steps that must be completed prior to doing the work of learning to become a trader.
At Nexgen Software Services Inc. we have the tools you need, the educational support and the staff to help you through this entire process. We can show you all of this in one short week, all you need to do is spend a week with us and you will never look at the market or how to become a profitable trader the same way again. |