Srs Trend Rider Complete Course
Srs Trend Rider Complete Course
Srs Trend Rider Complete Course
By Vladimir Ribakov
www.sRsTrendRider.com
Copyright 2010 | All Rights Reserved January 2010
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HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS. PERFORMANCE POSTED BY SYSTEM PROVIDERS MAY HAVE HAD LITTLE OR NO EXPERIENCE IN TRADING ACTUAL ACCOUNTS FOR ITSELF OR FOR CUSTOMERS. BECAUSE THERE ARE NO ACTUAL TRADING RESULTS TO COMPARE TO THE HYPOTHETICAL PERFORMANCE RESULTS CUSTOMERS SHOULD BE PARTICULARLY WARY OF PLACING UNDUE RELIANCE ON THESE HYPOTHETICAL PERFORMANCE RESULTS. PERFORMANCE POSTED BY SOME SYSTEM PROVIDERS MAY HAVE HAD LITTLE OR NO EXPERIENCE IN TRADING ACTUAL ACCOUNTS FOR ITSELF OR FOR CUSTOMERS. Notice of Rights: All rights reserved. No part of this eBook may be reproduced or transmitted in any form by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Trademarks: Throughout this eBook, trademarks are used. Rather than place a trademark symbol in every occurrence of a trademarked name or a screen shot of a product, we state that we are using the names in an editorial fashion only and to the benefit of the trademark owner with no intention of infringement of the trademark.
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Preface
Welcome to Vladimir's sRs Trend Rider Strategy, my proprietary trading system which paved the way to my success in the Forex Market. Over years of trading for a living, I have learned and used many trading strategies and tactics. However, I always used the sRs Trend Rider Strategy as a starting point. This is my most precious strategy, and today I am going to reveal it to you. Before I begin, you have to know two important things about this system: 1) The sRs Trend Rider Strategy is very simple and very easy to implement after you learn its exact rules and principles, and 2) The sRs Trend Rider Strategy is MECHANICAL. You will not need to be concerned with complex interpretations and hesitations. Certainly there are no tricks involved. A final word: despite the sRs Trend Rider Strategy's simplicity, no Forex robot can replace the human eye here. After reading and learning my strategy, if you have any questions, you can contact me directly at my personal Direct Customer Care: contact@sRsTrendRider.com
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Table of Content
About the Forex market (Beginner's Introduction)Page 7 Why trade the Forex market? Forex introduction When can I trade currencies? Forex Brokers Currency rates What's a Pip? The "Spread" an important term What is leverage? Profiting from the Forex market Trade sizes Trading account types The trading platform About Me.Page 19 My sRs Trend Rider Strategy ...Page 27 Background The sRs Trend Rider Indicator The sRs Template The sRs Trade Management Robot
Installing the sRs System. page 26 Installing the Template + Indicator + Alert + Expert (robot) Operating the sRs Trend Rider Strategy in MetaTrader Understanding the sRs Strategy.Page Understanding the Template Understanding the sRs Trend Rider Indicator Working with the Template + Indicator
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The sRs Strategy in DetailPage 38 Trading Rules Using the sRs when the Trend is Up (Bullish) How to Close Partial Percentage of the Trade Using the sRs when the Trend is Down (Bearish) The sRs Trade Management Robot..Page Money Management
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trades that I enter manually. This is one of the cornerstones of the sRs trend Rider, and I'll teach you all about it later in this eBook.
Forex introduction
Foreign Exchange, or as some people refer to it: Forex, FX, or Currency exchange, is the largest financial market in the world. The daily turnover in this huge market is around 4 Trillion Dollars a day! This is about 1000 times as much as the New York Stock Exchange (NYSE). The Forex market is also the oldest existing market, because as long as two countries traded with each other, they needed their currencies exchanged. If you live in the United States and would like to travel to Europe, youd have to exchange your $$ for Euro. Thus, trading in the Forex market simply means that you simultaneously buy one currency and sell another, for example buying Euros in exchange for US Dollars. If you want to trade the Forex market for profit, you will open a trading account with an online broker as opposed to going to a change shop to exchange your travel money. This way you can buy and sell currencies from the comfort of your home. This also gives you other advantages, such as limiting your risk and leveraging your funds, as Ill explain later. The Forex market has no central market place like the NYSE, Nasdaq or London Stock Exchange. These exchanges have one physical location where buyers and sellers meet and trade. Unlike these stocks and futures markets, currencies are traded between banks around the world, 24 hours a day 5 days a week. Trading is done via phone, chat or an electronic network. Until a few years ago, the Forex market was closed to private individuals. Only governments, banks, large hedge funds, and other wealthy institutions were allowed to trade this market. To trade currencies you needed to deposit hundreds of thousands of dollars and use astonishingly expensive real time data platforms.
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All this has changed in the wake of the internet revolution. Today, anyone can trade in the Forex market, as long as they have a computer connected to the Internet.
Forex Brokers
Forex trading is usually done between banks, companies and other institutions. Banks usually do not cater to the needs of the individual currency investor or speculator. It is only Forex brokers who enable you trade Forex with them on low commissions, create the possibility for small deposits and small trade sizes, online access, ability to trade using an automated robot and many other advantages.
Currency rates
Currencies are quoted in pairs. For example trading the Pound for US Dollars means trading the pair GBPUSD. The most actively traded pairs in the world are:
EURUSD (Euro and United States dollar), USDJPY (United States dollar and Japanese Yen), USDCHF (United States dollar and Swiss Franc), GBPUSD (Great British Pound and United States Dollar), AUDUSD (Australian Dollar and United States Dollar), USDCAD (United States Dollar and Canadian Dollar).
These pairs are called the majors. There are also numerous minor pairs (crosses) for all world currencies. For example: USDZAR (United States Dollar and South African Rand), EURNOK (Euro and Norwegian Krone). The first listed currency is called the base currency which is the basis for the buy or sell transaction. The second listed currency is called the counter or terms currency.
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A quote of 1.2980 for EURUSD means that for each 1 EURo (the base currency) you get 1.2980 of USD (the counter currency).
What's a Pip?
A pip is the smallest price change that a given currency pair can fluctuate. If the price of the EURUSD is 1.2974 and a few seconds later it's gone up to 1.2975 we say it has increased by 1 pip. Each point of change is called a Pip.
Advanced
As you see, currencies are quoted with several digits after the decimal point. For example: 1.2971 or 98.77 Most of the currency pairs are quoted with 4 digits after the point, except for pairs which include the Japanese Yen (JPY), which are quoted with 2 digits after the point. There are brokers who add an additional digit to the end of the quote. For example, they'll write 1.29715 to signify that price has moved by half a pip from 1.29710.
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This last digit is called a fractional pip. This might seem a bit confusing but you have to remember that the important digit is the 4th digit (or 2nd in case of JPY pairs). The additional digit is just a finer representation of the price.
Have you noticed that currencies are quoted using 2 numbers? The right number, which is always the higher, is the price you can buy the currency pair. It is called the Ask. The left number (always the lower) is the "Bid": the price you can sell the pair, e.g. Sell Euro and Buy US Dollar. Theoretically, if you bought the pair at 1.2974 you can immediately sell it back for the lower selling price of 1. 2971 (you always buy the Ask and sell the Bid) hence losing 3 pips.
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The calculation is: 1.2974 1.2971 = 0.0003 which are 3 pips. Ok, so it's clear there's a difference between the two quoted prices for each pair, the Bid and the Ask. Forex brokers should have some way of being compensated for their services. Since they don't charge a flat commission, they get those 3 pips of difference (or some part of it). The name given to this difference between bid and ask prices is: Spread. The spread is different between currency pairs and between brokers. Some might have a spread of 2 pips for EURUSD, some 3 pips, and still others will have a spread that fluctuates throughout the day.
What is leverage?
Leverage enables you to use the lowest possible deposit in your account, while still enabling large profits. However leverage can work both ways as it increases profits as well as losses, so it should be treated as a double-edged sword. One of the attractive benefits of Forex trading is the ability to use a very small deposit to control a much larger trade size. In effect, the broker is lending you money to trade as if you have a much larger account. In other words, suppose you deposit $500, you can enjoy the kind of profits that someone with an account such as $100,000 would have enjoyed; whilst at the same time limiting your risk to your deposit money only (most Forex brokers wont let you lose more than what you deposited).
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This deposit is called Margin account. For example, with just a $50 deposit in your account, you can buy or sell $10,000 worth of a currency pair such as EURUSD. This is called a 200:1 leverage (10,000 / 50 = 200). How leverage affects you? The effect of this leverage is to amplify market movements. Suppose your broker gives you a leverage of 100:1. Now you open a trade in the EURUSD currency pair, and it moves say percent higher. The leverage will amplify the move in your account, and the account will change by 50% for better or worse! (100*0.5 = 50) However, bear in mind that leverage is like a double-edged sword. It can work against you instead of for you if you dont use proper risk control. One of the most important safety measures is the pre-determined Stop Loss price. This means that whenever you put on a trade, you include an instruction to the broker to stop the trade at a loss if the trade goes a certain way against you. That way, your loss on a single trade is limited and known in advance.
Example of a currency trade with a pre-determined Stop Loss (S / L), which in this case is the price 1.2951
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As opposed to the stock market where you buy and sell actual parts of a company, in the Forex market you are selling currencies of countries around the world. Your goal is to buy a currency pair at a low rate and sell back when it rises to a high rate. The opposite is also true: selling a currency at a high rate and buying it back at a low rate. In other words, there are two types of trades you can do: Buy a currency pair This means you buy the base currency, in the case of the EURUSD you buy the Euro. Because it's the foreign exchange market, and you're dealing with a pair of currencies, it means you exchanged (sold) Dollars for the Euros you bought. Now, suppose after you bought EURUSD, the currency pair became more expensive. That means the same 100,000 Euro you bought just a while ago for $124,500 might now be worth $125,000. If you were to close that trade (sell the EURUSD) your account would register a profit of $500. Of course, if the rate of the EURUSD went down instead of up, it would have been registered in the trading account as a loss.
In this example we bought the EURUSD at 1.2979 and a few seconds later it increased in value to 1.2983 (+4 pips). Our profit, as seen in the right corner, is $40.
Sell a currency pair You sell the base currency, which in our example is the Euro. What have you bought in exchange? You guessed it: selling EURUSD means you sold Euro and bought USD.
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Suppose after you sold the EURUSD, its rate went down. That means the Euro got weaker vs. the Dollar. You can look at it the other way around and say that the Dollar became stronger vs. the Euro. Either way you look at it, since you bought Dollars and now they are worth more against the Euro, you made a profit. Of course, if the rate of the EURUSD went up, our Dollars are now worth less Euro, and it would have been registered in the trading account as a loss.
In this example we sold the EURUSD at 1.3011 and a few minutes later the rate was 1.3000. When selling 1 lot of this currency pair, a drop of 11 pips means a profit of $110 as seen on the right corner.
Trade sizes
When placing an order for the broker to buy or sell, you have to specify the quantity of the base currency to buy or sell. This quantity is defined in terms of Lots.
For example:
You would like to buy the EURUSD. The base currency here is the Euro. Now you must decide how much Euro you're going to buy. Suppose you want to buy 100,000 Euro, which is an amount possible even if you have a small margin account (please refer to the "Leverage" section above for explanation). You (or your robot) don't normally tell the broker: "Buy me 100,000 Euro!. What you need to do is specify to the broker how many lots to buy. 1 lot of EURUSD is worth 100,000 Euro.
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The correct way to pass your order would be to instruct the broker: "Buy 1 lot EURUSD".
Another example:
Suppose you want to buy 1.5 lots of EURUSD, how much Euro will this be? 1 lot = 100,000 so 1.5 lots are 100,000 * 1.5 = 150,000 Euro.
Main screen of the MetaTrader Forex trading platform. Except for the online price chart, you can also see the real-time quotes on the left, and an abundance of advanced trading tools and technical analysis indicators.
However, simply having the right tool at your fingertips is not enough, as many newcomers to this market have unfortunately discovered. 90% of all investors speculating in the Forex market are losing their investment! In order to profit from the Forex market you need something extra, an edge over those 90% losing crowd.
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About Me
The Forex Market is my life. I live, breathe, and eat out of the Forex Market. You can even say that I am married to a Forex Market girl. My wife Marina is a professional trader, too, as you can probably understand by now. I would be embarrassed to share our pillow talk with you, but suffice it to say Marina prefers reading analyst reports to Vogue magazine... My way in the Forex world started many years ago, and like many other traders it started by attending various Forex market lectures and courses. I participated in quite a few fascinating technical approach seminars and studied endless books from the most famous traders. And so I started trading. First using demo accounts, which was quite successful. Then I deposited small amounts, 100$, 250$ and to my surprise I managed to extract a few percentages out of the market. Taking my "beginners' luck" one step further I managed to convince my parents that I had a natural talent, so they agreed to "invest" 10,000$ of their life savings in me. Although I had heard it so many times before from the mouths of market gurus and I had learned a lot about risk management, I discovered the demo practice with small money turned out to be very different from the real world. I found out the harsh way that success with small deposits does not necessarily promise success in deeper water. On top of that, trading with other people's money is a different game altogether. A new side of human psychology comes into play. Sometimes I was impatient, rushing to trades without a strong reason. Other times (especially after losses) I hesitated to enter what was later proved to be a terrific money-making opportunity.
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I couldn't stop my losses, I hurried to take profits and I have literally made all the common mistakes of most traders. At the end of the day, I lost all my parents' money. I literally erased their money and it hurt. It really hurt. It was money that my parents saved during the years, and was intended to secure the family's future. The humiliation, shame, despair, depression are just a few words to describe what I felt!!! After an encouraging conversation with my parents who were surprisingly supportive, I gathered my racks and enrolled myself in higher financial education. I am naturally a very positive and persistent person. If I set a goal for myself I will do everything to achieve that goal. I promised myself that not only will I return my parents their money; I would also be the best in this field. Fast-forward several years, and I can proudly say that my goal has been achieved. The learning curve was long, exhausting, and had endless turnovers, but eventually I developed financial theories, tested many strategies, and came to final conclusions. I have no doubt that I wasn't the only one who experienced the things I've gone through. I know that many people share the same disappointment and despair that I felt. What I am going to teach you in this short and focused course I owe to many of you out there, who tried and never gave up. I am going to give you the strategy that put me back on track and helped to achieve most of the goals I set for myself long time ago. This strategy is my unique method which I have developed throughout several years of trading practice.
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I am not going to present just the strategy, but rather I will explain and demonstrate the way I deducted why to invest in this particular strategy. I will also disclose the recommended trading hours and the right currency pairs for them, as well as the way to use this strategy and what money management approach works best. This strategy works with my proprietary indicator and template, which I have developed myself and which my wife Marina has put life into. The template and indicator are enclosed with this manual. I have also prepared a short video to help you implement it in no time. So, go and make yourself a cup of coffee, relax, and let's begin
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Testing the sRs Trend Rider Strategy for almost a year with real money convinced me that I hit gold with my shovel. The profits from my sRs Trend Rider Strategy made it possible for me to redeem my parents' money and left enough money in my pocket to live a luxurious life, even though I was still just a student. I can honestly say that the sRs helped me regain my self confidence and finally gave me a good spot to start from. From that moment onward, I knew I was on the right path to become a professional trader. During the time, I have found ways to perfect the sRs to produce results which are even better and more profitable. Together with my wife, Marina, we have designed a special dynamic template for the sRs to ease the use of it and to make it more accurate. So, it is time for you to learn all about the sRs system. I'll start with presenting its basic components, so you'll have a better understating of your actions. Afterwards, I'll explain how to put it all together and turn it into your own trading plan.
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This number won't say anything to you at the moment, but carry on reading and you'll soon discover its magic. Any conclusion you arrive at will be dependent on this level. The logic behind using the sRs Trend Rider Indicator is based on all the outputs of my trading logs, collected throughout my entire trading career. I have gathered and analyzed the logs carefully. From my logs I derived and pinpointed exactly where my entry point was in relation to the best entry point, and also when the best time was to take profits. The sRs Trend Rider Indicator combines all of my long and complicated statistical calculations, taking into account momentum and market trends.
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You can even say that the sRs Trend Rider Strategy, with its template + indicator, functions as a "Semi-Robot". This strategy cannot be translated to a fully automated robot though. Even with today's modern technology, there is no substitute for the human eye. Thus, the strength of your human eye is needed, as you'll see in a minute. Tempting as it sounds, automated systems have their limitations, and I found that my unique system is so tailored to my "human" trading that it simply isn't a task for a computer. Before I show you exactly how to operate the sRs, let's just say that the sRs is designed to pinpoint the best entry and exit points, and you, upon very simple principles which you will learn in the next chapters, will decide whether to take this trade or not. This system, along with the unique money management system that I'll also reveal to you, has proven to have very high success rates and large profits!!!
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Since I combined all elements together, I found the sRs to be capable of delivering even more than 100 pips per day working with only two currencies pairs. I think this strategy is so profitable that it has the ability to replace your main income once you master it.
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Double-click it and it will open by using your unzipping utility. You should see a window similar to this, displaying the two files inside:
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The two files you see here are: 1. sRs_Trend_Rider_Complete_Course.pdf (the file you are reading at the moment) 2. sRsTrendRider_Install.exe Double-click the file: sRsTrendRider_Install.exe The quick install program will open and display this window:
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Click on the Next button to continue. In the following window, you need to locate the folder on your computer, where you installed MetaTrader. Click on the Browse button to find the folder:
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Now click OK to return to the previous window, where your chosen folder is displayed:
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The next window you'll see, confirms that the installation was successful. Click Finish to close it:
That's it! You have installed the sRs Trend Rider template, indicators and trade management EA. You can now open your MetaTrader platform.
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Right-Click somewhere in the chart area and from the popup menu select TemplatesRs_trend_rider_template:
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That's it!!! Your sRs Trend Rider Package is installed and ready for use.
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Later (in Rule #4) I'll teach you what to do when this alert sounds.
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The template combines 3 moving averages, 4, 6 and 14 and the sRs Trend Rider Indicator. As you can see, I differentiated between the moving averages with three colors, red, blue and green. The combination of these 3 moving averages and the sRs Trend Rider Indicator will provide us with Current Market Trend. The working rules of the 3 moving averages are as follows: 4 above 6 and BOTH above 14 the market trend is UP (Bullish)
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The automated Alert component of the sRs Template is designed to work with the indicator and sound an alert only if the indicator has passed its test level. Therefore, you don't have to constantly watch the indicator. Just wait for an alert to sound, along with the following Alert window that will appear on the chart:
Later (in Rule #4) I'll teach you what to do when this alert sounds.
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Many people use moving averages in many ways. However I found that the way I'll teach you here is the most effective and reliable way I can use them for my trading style. At the bottom of the chart you'll see the sRs Trend Rider Indicator that will give you the direction the market is moving IN RELATION to your test level 10,000 point.
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When the alert sounds, jump to Rule #4 which I call the "Eye Rule". This is the only rule that can't be automated.
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Rule #1 Look at the sRs Trend Rider Indicator and see when the asterisk crosses the 10,000 line.
When the 10,000 line has been passed, then the first rule has been fulfilled. For the sake of this example, it means that the market has moved toward an UP trend direction. You can now move on to rule #2
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Rule #2 Make sure that the 3 moving averages are set in the following order: 4 above 6 and both above 14.
As I explained earlier, the 3 moving averages are in fact a tool, which helps you identify and follow the trend. You want to be sure that the 3 moving averages are set accordingly. Now that you understand rule #2, you now can move on to rule #3. Rule #3 This rule is very simple. After you ensured the 3 moving averages are arranged in the required order (rule number 2), you switch to the next higher time frame, to ensure that the moving averages are arranged there in the right order as well. By "next higher time frame" I mean, for example, if you're working on the 5 minutes time frame (M5), you switch to the 15 minutes (M15). By the way, the alert automatically checks this higher time frame for you, so it will only sound when the rule is being met in the 15 minutes chart, even if you don't see the chart on screen.
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So, continuing our example, you switch to the 15 minutes time frame and make sure that the 3 moving averages are set in the following order: 4 above 6 and both above 14. If they're not arranged in that order, it means you don't have a high-probability setup, and therefore you may wish to wait for a better opportunity. Rule #4 This is the "Human Eye" rule, which means it's the only occasion when you have to use the strength of your eye's observation to determine the trade's entry point. Don't worry, after little practice you'll easily master this simple rule. Rule #4 says that the trade should be entered at the break of the last high in the current up trend. I'll now explain this in detail: What you have to do is look at the current up trend. It's usually just starting, but you can identify the highest price it has reached. What was the highest price reached in this up trend? Look at the example on the next page. I had a long green candle going all the way from the bottom, then another small green candle. The small green candle's top is market with the black line ("the last high"). This was the highest price reached before the current position. When the market surpasses this price we should enter the trade.
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Notice the pink arrow head pointing upwards. This marks the spot when the market surpassed the previous high, which is the spot you should enter the trade. I'll now give you tips and insights into how to determine the last high: (see next page)
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The last high is the highest point that you have in the current up trend. An "up trend" is defined as having at least 2 bars that exhibit higher "lows" and higher "highs", as Illustrated here: Notice how "high 2" is higher than "high 1", and "low 2" is higher than "low 1".
After spotting the last high, you must make sure that you have at least 2 bars (candles) after it that failed to exhibit a new high. Take a look at this illustration the two bars that followed the last high ("high 2") did not reach higher than high 2. Therefore, high 2 is our last high.
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Here are some more examples of correct and incorrect "last high":
Example 1 (left) shows an uptrend of 3 bars. The second bar from the left reaches the highest price. Then 2 bars fail to reach a higher price. Therefore you can say that the last high was set at the 2nd bar, which I marked with an arrow. Example 2 shows another uptrend of 3 bars. The third bar from the left reaches the highest price. Afterwards you can see 4 bars that fail to reach a higher high price. Therefore you can say that the last high was set at the 3rd bar, which I marked with an arrow. Example 3 shows an uptrend of 3 bars. The third bar from the left reaches the highest price. Then one bar goes down, and then the 5th bar reaches a price higher than the one set by the 3rd bar. Therefore, the high of the 3rd bar is not your last high. However, the high of the 5th bar is also not your correct last high, because you don't have 2 bars afterwards that don't exceed that high. You only have 1 bar after the 5th bar. In this case, you will not enter the trade, as the "eye rule" is not fulfilled.
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Some people may find using bar charts instead of candlestick charts easier in determining the "last high":
To change to a Bar Chart view, from the Charts menu choose Bar Chart.
In the previous screenshot you can see how the last high was determined where the black arrow points. After that high, there were more than 2 candles that did not manage to reach higher.
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Once you know the exact place where to enter your trade, it is time to secure yourself and place your Take Profit and Stop Loss. Placing the Stop Loss in an Uptrend market, we will put the stop loss 2 pips below the last low.
Example no.1
Example no.2
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IMPORTANT! If you're trading on the 5 minutes (M5) time frame, and find the stop loss to be greater than 50 pips don't enter the trade! This is too large a stop loss for a 5 minutes chart. The average stop should be between 25 40 pips. Placing the Take Profit in an Uptrend market, I have chosen a very special approach and after I detail my rules for it, I will explain why I have picked this method. 1. Determine your take profit half way from your stop loss. That means that if you found that the stop should be placed after 40 pips from the entry price, you set the take profits to half of it, namely 20 pips. 2. Once you achieved the first profit target of 20 pips to take profits, close 80% of the trade and leave 20% open. For example, if you opened a trade of 1 lot, close 0.8 lots. Don't worry, you don't actually need to close it yourself, the sRs Trade Management robot will do it for you automatically. Ill explain more about this later. 3. Once the 3 moving averages changed direction, I will close the rest of the trade, meaning the 20% which I left open. By "moving average change direction" I mean that they are aligned for a down trend (rule #2). Here you also don't actually need to close it, the sRs Trade Management robot will do it for you automatically.
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Example no.1
Example no.2
"Early retirement" of the trade Sometimes the first profit target is not reached, i.e. you didn't have a chance to close 80% of the trade because the market did not rise enough. If the market did not trade at the stop loss level, you're still in the trade. If you see the moving averages line up in the other direction (for a down trend), close the trade immediately. I call this "early retirement" of the trade.
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The trade closing window appears. In the Volume box you'll see the total number of lots for this trade. In this case: 1.0 lots.
Replace it with 80% of the trade's lots. For example: 1.0 * 0.8 = 0.8
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That's it! In the Terminal window you'll be left with the remainder of the trade (0.2 lots) open:
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Note: as explained earlier, rules #1, #2 and #3 are automatically covered by the sRs Alert. Rule #1 Look at the sRs Trend Rider Indicator and see when the asterisk crosses the 10,000 line.
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When the 10,000 line has been crossed, than the first rule has been fulfilled. For the sake of this example, it means that the market has moved toward a down trend direction. You now can move on to rule #2 Rule #2 See when the 3 moving averages are set 14 above 6 and above 4.
When you understand rule #2, you can move on to rule #3. Rule #3 This rule is very simple. After you ensured the 3 moving averages are arranged in the required order (rule #2), switch to the next higher time frame to ensure that the moving averages are arranged there in the right order as well.
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For example, if you're working on the 5 minutes time frame, you switch to the 15 minutes:
So, continuing our example, you switch to the 15 minutes time frame and make sure that the 3 moving averages are set in the following order: 14 above 6 and above 4. If they're not arranged in that order, it means you don't have a high-probability setup, and therefore you may wish to wait for a better opportunity. Rule #4 This is the "Human Eye" rule, which means it's the only occasion when you have to use the strength of your eye's observation to determine the trade's entry point. Don't worry, after little practice you'll easily master this simple rule. Rule #4 says that the trade should be entered at the break of the last low in the current down trend. I'll now explain this in detail: What you have to do is look at the current down trend. It's usually just starting, but you can identify the lowest price it has reached. What was the lowest price reached in this down trend? Look at the example below. I had two red candles going down, then another small candle that reached a bit lower. You can see it in the screenshot marked by a black line ("last low"). This was the lowest price reached at the time. When the market goes lower we should enter the trade.
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I'll now give you tips and insights into how to determine the last low. The last low is the lowest low that you have in the current down trend. A "down trend" is defined as having at least 2 bars that exhibit lower "lows" and lower "highs", as Illustrated here: Notice how "high 2" is lower than "high 1", and "low 2" is lower than "low 1".
After spotting the last low, you must make sure that you have at least 2 bars (candles) after it that failed to exhibit a new lower low. Take a look at this illustration the two bars that followed the last low ("low 2") did not reach lower than low 2.
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Here are some more examples of correct and incorrect "last high":
Example 1 (left) shows a down trend of 3 bars. The third bar from the left is at the lowest price. Then 2 bars fail to reach a lower price. Therefore you can say that the last low was set at the 3rd bar, which I marked with an arrow. Example 2 shows another down trend of 3 bars. The 3rd bar from the left reaches the lowest price. Afterwards you can see 4 bars that fail to reach a lower price. Therefore you can say that the last low was set at the 3rd bar, which I marked with an arrow.
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Example 3 shows a down trend of 3 bars. The third bar from the left reaches the lowest price. Then one bar goes up, and then the 5th bar reaches a price lower than the one set by the 3rd bar. Therefore, the low of the 3rd bar is not your last low. However, the low of the 5th bar is also not your correct last low, because you don't have 2 bars afterwards that don't exceed that low. Remember you must have 2 bars that do not exceed the last low, and here you don't have any further bars. In this case, you will not enter the trade, as the third "eye" rule is not happening. Even though it's a matter of personal preference, you might find it easier to determine the "last low" if you use a bar chart instead of candlesticks chart:
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Once you know the exact place where to enter your trade, it is time to secure yourself and place your Take Profit and Stop Loss. Placing the Stop Loss in a down trending market, determine the last high, and place the stop loss 2 pips above it plus the spread (spread should be added only for sell trades, not for buy). For example: If you found the last high to be 1.4000 you'll add 2 pips and also add the spread (say 3 pips), so your stop will be at: 1.4000 + 2 pips + 3 pips = 1.4005
Example no.1
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Example no.2
Placing the Take Profit These are the rules for a profitable exit of a sell trade. In a minute I'll explain why exactly I have picked this method. 1. Determine your take profit half way from your stop loss. That means that if you determined the stop loss should be placed after 40 pips from the entry price, you set the take profits to half of it, namely 20 pips. 2. Once you have achieved the profit target of 20 pips to take profits, close 80% of the trade and leave 20% open.
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For example, if you opened a trade of 1 lot, close 0.8 lots. Don't worry, you don't actually need to close it yourself, the sRs Trade Management robot will do it for you automatically. Ill explain more about this later. 3. Once the 3 moving averages changed direction, close the rest of the trade, meaning the 20% you left open. By "moving average change direction" I mean that they are aligned for an up trend, as explained in rule #2. Here you also don't actually need to close it; the sRs Trade Management robot will identify the situation and do it for you automatically.
Example no.1
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Example no.2
"Early retirement" of the trade As with a buy trade, also here sometimes the first profit target is not reached, i.e. you didn't have a chance to close 80% of the trade because the market did not rise enough. If the market did not trade at the stop loss level, you're still in the trade. If you see the moving averages line up in the other direction (for an up trend), close the trade immediately. I call this "early retirement" of the trade.
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Now let's move on to examples: 1. I opened a trade of 1.0 standard lot. This trade size means that each 1 pip of market movement will be worth $10 in my account. My stop loss is 50 pips. This means that my first profit target should be 25 pips. When I reach this target, I'll close 0.8 lot, which are 80% of the original trade size. With 0.8 lots, each pips of movement is worth $8. So I get: 25 pips * 8$ = 200$ Let's assume the trade continued in the desired direction, and I exited the trade when the moving average lined up to the other direction, with a 100 pips more in my pocket, earned with a trade size of 0.2 (what was left from previously closing 0.8 of the trade). Now my additional profit on the 0.2 lots would be: 100 pips * 2$ = 200$ This means a total of $400 on this trade. 2. Now let's say I opened a trade of 1.0 standard lot (each 1 pip of market movement will be worth $10 in my account). My stop loss is 50 pips. This means that my first profit target should be 25 pips. When I reach this target, I'll close 0.8 lot, which are 80% of the original trade size. With 0.8 lots, each pips of movement is worth $8. So I get: 25 pips * 8$ = 200$ Let's assume the market reversed and I exited the remainder of the trade on its stop loss. This means: 50 pips * 2$ = -100$ This means I ended the trade at a profit of 200-100 = $100!
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Now the truth is in the numbers, and 80% of the trades close in profit (actually, due to my experience I get a much higher percentage of my trades that close in profit most of the time). This is why most of the trades will close in profit, and on the whole you have here a method with an amazingly high statistical positive expectancy. This translates to big profits for you! You'll see that the numbers and charts don't lie, and you have here a simple, effective, and highly profitable system. Plus, I will email you a weekly report to help you see the method in action and learn from my own trading, which is based on years of experience. But if you thought this was the end well, its just beginning! In the beginning of this course you might remember that I mentioned something about how a "half robot" saves you a lot of hassle. I realized that the best and safest way to get you on course is to make sure you'll identify the correct trading opportunities as easily as possible. That is why my wife Marina and I have built the sRs template and alert (which are a sort of "half robot") that will signal you when the 3(!!!) first rules are present in the chart. This is incorporated in the sRs template, so all you have to do is wait for the template to alert you of an incoming opportunity! No need to sit in front of the computer and wait for a trade. Just make sure you're close enough to your computer that you can hear the audible alert.
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Once you hear the alert and see the alert message on screen, such as this one
you need to check for rule #4 - the "human eye" rule. If the market displays the rule, enter the trade (if the alert was to go LONG, enter a Buy trade. if the alert was to go SHORT, enter a Sell trade).
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I also mentioned earlier that you received a Trade Management robot that will manage the trades for you. This is how to operate it: 1. First, after entering the trade, make sure you set the trade's stop loss as I explained earlier. 2. In the Navigator window, click the little plus sign next to "Expert Advisors" to expand the list. Note: if you don't see the Navigator window, go to the View menu and choose Navigator.
3. Double-click the sRs_Trade_Management_Robot and make sure the following are ticked in the Common tab:
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4. Now click OK. That's all your trade will be managed automatically. For advanced users: Click the Inputs tab of the sRs Expert and you'll see the following:
Let's go over the available parameters: Get.Full.Take.Profit = should remain on its default (true) if you'd like the robot to manage the trade automatically. If you're an advanced trader who would like to close the trade according to your own personal trading rules, then choose "false". Alert.With.Sound = leave on its default (true) to hear an audible alert every time the 2 rules of the sRs are present. If you'd like to just see a message on screen with no alert, choose "false". Get.Protected.Stop.Loss = this is an important parameter. Sometimes the first target is not reached, but the stop loss is not touched either. The robot will wait patiently, and once the moving averages would point to the other direction - the robot would do the same thing that I would do and close the trade. This is the default (true).
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If you'd like to close the trade only with its stop loss, or upon any other condition, choose "false". Lines.Color = choose the color of the take profit line that the robot will paint on the chart. If you still don't believe it is that simple, let's look at a real-life example: Do whatever you like around the house, just relax and enjoy yourself, and when the sRs template tracks an opportunity, you'll hear an alert sound and see this message on your screen:
See, it's that easy! Now remember, don't enter the trade immediately. You need to look for rule #4 - the "human eye" rule and only then should you enter the trade.
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Now let's see the trade in action: In point 1 you can see the sRs Trend Rider Indicator crossing the 10,000 level downwards. But the moving averages are not lined up correctly, so there is no alert.
In point 2 again the sRs Trend Rider Indicator crosses the 10,000 level downwards. This time the moving averages are lined correctly, and you get a signal. After a minute or two, you see that the last low was broken down (the dashed line above points 1 and 2), meaning it's time to get into the trade. You open the trade, determine the stop loss to be above the last high, and then apply the Trade Management Robot to this chart. This is what happened after a few more minutes: 18 pips * 8$ (80% of the whole trade) = 144$
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Now let's see what the robot will do with the rest of the trade, 0.2 lots. It will close them when the moving averages change direction, which is at point 3 on the chart. 100 pips * 2$ (20% of the whole trade) = 200$ And at the end you are left with a nice profit of $344 from a single trade... That took 5 minutes of your time. Of course not every trade will be profitable, and not all trades will be as profitable, but you will have winning trades and see your account grow. Let's see some more examples:
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A couple of important points: 1. Economic News: do not ever enter a trade if the signal appears less than 30 minutes before a major economic news announcement such as: Interest rate, US nonfarm payroll, unemployment, GDP, etc. You can check news times with this excellent website: www.forexfactory.com 2. sRs was developed to take away all the hard work and hassle of manual trading. However you still need to give your final confirmation of the trade, and that's why you enter the trade manually.
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There's no escaping this, because a robot wont be able to see everything that your eyes see. So take a quick glimpse at the chart, and let the robot do the rest. I'll end by showing you one of my trading weeks:
A total profit of $2680 for one week. And this is not the best of weeks, since I had 3 losing trades
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This is the reality, $2680 for one work week, more than $10,000 a month. This is for 1.0 lot per each entry. Of course if your trades are smaller than 1.0 lot the profits will be less. But this is just on one currency pair the GBPUSD. Since the sRs works with all currency pairs, you have the opportunity to do much more than that. Adding another currency pair will bring an income of more than $20,000 for that month. Imagine what happens with 3 currency pairs And now for some recommendations and my own favorites with this strategy: Favorite currency pair: GBPUSD I also achieve great results with these pairs: Eur\jpy Gbp\jpy Usd\cad Favorite times of day (GMT) 5 am to 18 pm. Alternatively, trading the American session (from 13:30 GMT). Recommended chart timeframe: 5 minutes (M5) IMPORTANT! When trading on the 5 minutes (M5) time frame, if you find the required stop loss to be greater than 50 pips don't enter the trade! This is too large a stop loss for a 5 minutes chart. The average stop should be between 25 40 pips. Please note that the above are only my favorites, and it certainly doesn't mean that the strategy don't work with other currencies, time frames or trading hours!! I have found the strategy to work well on all currency pairs.
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Regarding trade times, if you pick the times when the markets are most active (the European and/or US sessions) than you'll see more action on the chart, meaning you'll reach your targets more quickly and easily, as with any other trading strategy. Let's do a quick summary of how to trade the sRs: 1. The sRs Trend Rider Indicator shows the 10,000 level crossed. 2. Moving Averages lined in an uptrend or downtrend direction. 3. Alert is displayed. 4. Check the "human eye" rule. 5. Enter the trade and determine stop loss. 6. Operate the Trade Management Robot. 7. Collect profits Just be sure to stick to the trading rules, don't change them or give in to the temptation to close too early or to the fear of getting into a trade. And don't use high leverage! It always kills your account, no matter how good your strategy is. So be careful with your trade sizes. Ok my friend; this is where you start the profitable part of your Forex journey. I hope you enjoyed this eBook, and will make full use of the powerful secrets within it. I wish you the best of luck, and hope you'll know how to make your dreams come true! All the best, Vladimir Ribakov
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