【FX Course】Can you explain the entry reason in one sentence?
Can you explain it in one sentence?
Hello, this is Leo.
When you trade, there are times you want to search for many grounds to enter.
Horizontal lines
Trend lines
Moving averages
Chart patterns
Signal tools
The more grounds there are, the more you feel your trading accuracy improves.
But I think, if you increase grounds too much, it can instead
in the first place
to happen.
So what I want to be conscious of is
whether you can explain the entry reason in one sentence
.
Good trades have surprisingly simple reasons
For example, for a buy trade,
That level alone is enough.
Conversely for a sell,
works.
What you are looking at becomes fairly clear.
If you search for grounds too much, it becomes “reasons to enter”
For example, you actually want to buy.
But the conditions aren’t all in place yet.
So you keep watching the chart,
「MA is nearby」
「In the 15-minute there’s a double bottom」
「Oscillator is overbought」
and grounds keep piling up.
But this is less about analyzing the market and more about
to enter
potentially.
Grounds should be categorized by function, not number
If it were me, I’d organize by function rather than lining up many grounds.
Look at daily and 4-hour to see buy or sell
② Location
Look at horizontal lines, pullback lows, pullback highs
③ Timing
Look at 1-hour and 15-minute turning points
④ Risk
Look at stop loss, profit target, risk-reward
If these four are in place, it becomes much easier to organize.
For example, Euro/USD
Suppose the Euro/USD daily is in a downtrend.
The 4-hour is also down.
From there, the 1-hour has pulled back.
Stopped near an important horizontal line, and the 1-hour makes a new low again.
Then,
can be explained.
This makes it easy to review after the trade.
If you can explain in one sentence, you’ll understand why you lost too
Suppose the previous trade was a stop loss.
Then also,
Location was not bad
1-hour turning was confirmed
RR was not a problem
Then, it’s a rule-based loss.
On the other hand,
It was in the middle of a horizontal line
RR was poor
Then, there are clear points to improve.
In other words,
the verification becomes simple
If you can’t describe in one sentence, wait once
For example,
and
In such cases, the market itself may still be unclear.
I think this is fine.
Even writing one line before entering changes things
If you tend to enter on feel,
before entering, try writing just one line in a memo.
“Daily down + 1H pullback high stopped so sell”
That’s all.
If you can’t write it, don’t enter yet.
Even with such a rule, unnecessary entries will reduce considerably.
Same when using signal tools
When using signal tools, don’t justify entry only by the signal itself.
For example,
+
Higher time frame is down
+
Pullback selling candidate
+
RR can be secured
then,
you can say, “Sell because the sell signal appeared from the pullback in the higher time frame.”
And conversely,
if a signal appears but you can’t explain why you are entering.
then, you should pass.
If I were to check before entry, four things
② From which location to aim
③ What to confirm before entering
④ Where are the stop loss and take profit
Check these four,
and finally summarize in one sentence
that’s the idea.
Grounds are not about ten vs three; it’s about clear three
The more grounds you add, the more comfort you may feel.
But, not all of them are necessary.
Location
Timing
If these three are clear, it’s much easier to judge.
And then, confirm stop loss, take profit, and RR.
In trading, rather than gathering many grounds,
is important
Direction.
Location.
Timing.
Stop loss and take profit.
Organize these, and
“I buy because of x”
or “I sell because of y”.
If the explanation is complex, it may be a market that’s hard to understand at the moment.
Rather than increasing judgments, simplify judgments.
I also believe this is very important for trading reproducibility.
