Get ready, folks, this is quite a bit of a story.

Speaking of stories, I think one of the most fascinating aspects of retail day trading are the stories people share about how they decided to start trading and what that early process was like. Such anecdotes help others understand that day trading is a skill that anyone can learn, so long as you put in the effort, patience, and persistence.

I want to give you a detailed background of who I am and the reason why I decided to learn how to day trade foreign exchange currencies.

If at any point my story resonates with you, feel free to comment!

The story I am sharing with you is adapted from the second chapter of the book I wrote called The Seven Habits of Successful Day Traders, which covers some of the key thoughts, behaviors, and routines profitable traders use to make trading systems. Contrary to the wise advice to only trade what you can afford to lose, I began trading out of sheer desperation for income and some sort of work I could easily do from home.

Let me explain.

The first time I ever traded a security was in 2015. It was through a recently released app targeted for young and new traders, like myself, who wanted a platform so simple that even Steve Jobs would approve.

Its name? Robinhood.

This was a fun and exciting hobby for me while I was going to graduate school and earning meager wages from a few part-time gigs.

During a hike in the woods where I was living in Philadelphia, I told a friend about my newly discovered interest in the stock market. He mentioned the trending hype around 3D printing as a viable option for a sector. So, I bought some shares from a developer of 3D printers. In a couple of weeks, out of sheer luck, I was up $5,000.

Woo hoo!

This began my hobbyist intrigue with stocks.

Now, I wasn’t attending any ol’ graduate school program. Of all the possibilities for a career, I was training to become a rabbi.

From rabbi to day trader?

Yes, a bit of a big pivot, but I didn’t exactly plan it that way.

I wanted to become a clergy person and help people navigate their experiences with Judaism. I am fascinated by and empathetic towards the exploration of religion and the wrestling with some of humanity’s most difficult reflective questions, like why do bad things happen to good people. My interest in and study of religion and philosophy didn’t only revolve around Judaism but also Buddhism and ethics.

During my college years, I went to a small Jewish university in the Los Angeles area while also attending regular group meditation sessions and lectures at a couple of different Zen centers around LA. I was drawn to Buddhism as a teenager because of its emphasis on alleviating suffering via a discipline of meditation, self-reflection, and conditioning of one’s heart to be respectful and compassionate towards others.

Ever since I was a kid, I’ve been attracted to challenges that require strict, even stoic ways of thinking and being. I find this funny because my behavior and personality through my teenage years and early twenties were outright turbulent and impulsive.

A Zen teacher of mine once stated, “No one comes to Buddhism because their life is fine.”

Many people are seeking relief from the world or from themselves.

Buddhism’s tenets and practices can offer a kind of healing salve to the scars that come with life’s difficulties.

There were many scars and aspects of myself I wanted to mend and change. As a teenager lacking healthy coping skills while wrestling with severe depression, I turned to alcohol and drugs to numb myself. I was living a juggling act, as I was going to school and loving academia, but also routinely making choices that drew me closer and closer to trouble. In the morning, I could diligently work on a research paper as I hit my daily writing goals. Yet, at night, I would wind up in wild and risky situations like nearly inhaling a whole case of beer by myself, getting a homemade tattoo in some dude’s apartment, or taking a piss on Sunset Boulevard at four in the morning.

I was balancing between the pursuit of a successful future and outright self-annihilation.

Meditation helped me to finally develop a loving, wise voice in my head that could self-talk my way into better behavior and more compassionate thinking.

Zen Buddhism, in particular, is quite practical and can complement other religious practices without the dogma that most people fear of participating in religion. Between the support I received from my rabbis, teachers, friends, and the sangha (the group I meditated with), as well as the epiphanies that came with “waking up” to my own sense of responsibility I was able to get sober and completely change the trajectory of my life.

Nearing the time of graduation, I had three paths to choose from: the first was that I was accepted to a graduate program in Comparative Religion. The second was to spend few years meditating and working at a Zen Buddhist monastery. Or third, I could further my studies and pursue the path of becoming a rabbi.

In the end, I chose door number three while also maintaining a commitment to Zen Buddhist studies and practices. I invested all of my resources into this career choice and, at the advice of a professor, sought to spend at least a full calendar year living in Jerusalem to study halachic law. Living in Israel was both life-changing and very complicated. I made a group of friends who were more interested in having philosophical dinner conversations and playing fun board or party games than going to bars and clubs. Exploring the ancient cities and adapting to the culture cultivated a strong sense of adventure and curiosity within me. I found a new way to enjoy life, to process difficult emotions and fears, and to develop social skills without the help of liquid courage.

However, my stay in Jerusalem coincided with war and political turmoil, although this is not a rare occurrence for the region. It was very stressful and I started to have mixed feelings about the way Israel chooses to handle its own political and social issues. This experience forever changed my gratitude for having an American passport and the privilege of having citizenship in a relatively safe, free, and prosperous country, despite its own problems and need for change.

Afterward, I was accepted into a rabbinical school in the Philadelphia area and moved back to the States to continue my studies there. I was also pursuing a joint degree with another college to obtain a master’s in Nonprofit Management. At that point in 2015, I felt like I finally arrived into adulthood. However,  in my second year of studies, I started experiencing some alarming symptoms.

One fall evening, I woke up experiencing a hot flash. I didn’t think much of it. I just popped some Benedryl and promptly went back to bed.

Every consecutive night that followed for the next four years, however, would result in the same sensation of overheating and insomnia.

After the first few months, the flushing not only happened multiple times at night but also multiple times during the day. The insomnia was so bad that I began missing classes and the Torah classes I taught to a  cohort of senior citizens, as I needed to catch up on sleep during the day.

The flushing episodes then increased in frequency and duration of time. During the winter of that first year, I could walk out in the snow wearing only a t-shirt and shorts.

Something was seriously wrong.

I started seeing doctors and specialists, with nearly all my blood tests coming back normal. I tried to maintain my everyday existence as much as possible, but I knew my health was too out of control to manage it all.

The stressors increased: I wasn’t making enough money to cover my expenses, getting deeper in debt, my girlfriend and I broke up, leaving me with extra rent, and on top of all of that, I needed to go back to Israel to take classes over the summer to meet graduation requirements.

In the end, after starting to show signs of severe memory loss, I didn’t complete my studies in Israel. Instead, I returned to my native Southern California in an attempt to visit several doctors while staying at my mom’s house.

It would be years before I could tell whether I experienced deep sleep at night or not.

I’m sure you know that sleep deprivation is used as a form of torture – it was a living hell I couldn’t escape.

By then, I knew I needed to go on medical leave and get expert help. I tried to stay with some friends in Philadelphia if my condition improved so that I could continue my studies afterward but by the new year, nothing had changed. I decided to move back in with my family in California. I saw more doctors and specialists, I participated in an undiagnosed patient program with a top hospital in Los Angeles. When these endeavors failed, I met with nutritionists and functional medicine doctors.

While we found tweaks to abate some of my symptoms, my body and mind were still a wreck and there was no final diagnosis apart from a vague case of “Autonomic Dysfunction”.

After years of no sleep, I lost my ability to drive, as I couldn’t properly focus on the road, and my sight declined – I was stuck in constant tunnel vision with minimal to no peripheral vision, experiencing terrible fatigue, and suffering short-term memory loss.

I was even contacted for that one particular Netflix show about undiagnosed cases but it never went past a second interview. By then, however, I learned not to be bothered by disappointment.

Now, who here in their 20’s has managed to save a multi-years worth emergency fund just in case your health surprisingly falls apart and you’re unable to work? No hands? Not one?

There are certain circumstances that you cannot prepare for, no matter what kind of diligence you take.

This chronic health issue became my personal Black Swan event, one of those experiences that are unforeseeable, rare, and capable of completely redefining what “normal” looks like.

Because I didn’t have a proper diagnosis, a claim for disability seemed unlikely. My illness is invisible: I look like a healthy guy on the outside. But on the inside, I live in a constant cloud of confusion and fatigue.

Because of my unusual sleep patterns and brain fog, I knew I couldn’t be trusted to maintain a job, even if I worked from home. Whatever I could do for income had to be done in my own time and under my own decision-making power.

Some of you may be familiar with being stuck in survival mode.

It felt like I was making “last resort” decisions left and right.

In order to avoid having to make payments on my student loan debt, I was able to continue and graduate with my MS in Nonprofit Management since the courses were offered online.

After that, I was accepted into a Ph.D. program in Business, since my credentials in nonprofit management qualified me for the position. This gave me some confidence and something to focus on besides my health. I wanted at least one thing to feel like it was going right in my life. I love academia and I am passionate about research and writing. However, I still needed to find ways to pay for my medical bills and living expenses.

That’s when I discovered the world of retail day trading.

Continue with Part 2

Andrew, from Disciplined FX, here! If you’re interested in learning how to day trade as your profitable skill, I recommend reading the book I wrote on how you can leverage the most important habits of professional day traders to set yourself up for long-term success in the markets!

I’ve Been Thinking…

I want to share with you something that I’ve been reflecting on for some time now. 

Most of you reading, like me, probably grew up with parents or society pressuring you to get an education in order to create financial security in life. 

You might have been encouraged to hustle for scholarships or take out enough student loan money that could have covered the cost of a house in order to gain a university-level education and therefore qualify for a steady paycheck and benefits. 

This formula of “initial education investment + diploma + time and energy in someone else’s business, nonprofit, or government entity = financial stability and maaaaaybe satisfaction is starting to become more anachronistic and perhaps even mythical. 

 

Steady is no longer stable. 

A lot of my friends and family have what are considered “stable jobs” – sure, they receive a paycheck every two weeks, but their time to take care of themselves is limited, the amount they make barely scratches the surface of the student loan debt or living expenses they incur, and lurking in the shadows of this seemingly stable job is the threat of being laid off or fired at any given moment. 

Some of them like their work but others trudge along because there is no financial safety net to allow them the choice to leave. 

Thus, paying Fedloan Servicing or private student loan companies a ¼ of your budget each month and giving away ⅓ of your entire life, while failing to get enough sleep, have time to be with your family or friends, or just play, all for the sake of acquiring this illusion of a secure job is no longer a reliable formula for financial security, let alone a well-lived life. 

Now, This isn’t particularly enlightening of me to name this issue, as I believe most people are aware of this discrepancy. 

Some of you reading this may be feeling this pain right now. how to make +10k per month from home

(I will say that there’s also a special kind of motivation that comes with knowing you have debt, though. That’s a hidden ability we can use to our advantage. But that thought is best left for another post.)

While I think many folks have a hunch as to what a solution to this problem looks like, they may not have a clear formula for what to do to reclaim their time, energy, creativity, purpose, and financial well-being. 

So that’s what I want to share with you, today. 

A simple formula that I’ve seen others perform, time and again, to spend less time working, make enough money to assuage financial woes, and focus on the activities that create a better world and a more meaningful life. 

We know that relying on a sole paycheck won’t necessarily give you the safety it once promised. 

We also know that trying to drive for a ride-share company on the side or selling your used things on an app each month won’t necessarily grant you financial freedom either. 

So, what to do instead? 

Here’s my formula: We need to combine our favorite skills with income-generating activities OR develop skills that have a high return on investment and take those skills to market. 

Lucrative Skill + Skill Development (Time + Effort + Knowledge + Experience) + Marketability = Financial FREEDOM. 

This approach may require a lot of time and effort up front, but in the future it lets you acquire the resources to invest less time for the same return. 

 

Let me show you how to do this through 4 simple steps.

 

4 Steps to Making +$10k Per Month

Step 1) Research and Select Your Marketable Skill

As mentioned, there are two paths you can take with this. 

One is to select a skill that you’ve already developed and turn that skill into a business. 

The other approach is to learn a new skill that is inherently lucrative. These skills often involve the exchange of value for large sums of money and therefore have a large return on investment. checking new strategy works for forex EUR/USD

Some skills that fall under this category include selling real estate, learning a high-demand tech skill like coding, developing marketing or sales skills like copywriting and social media marketing, or, my personal favorite and the primary subject of this blog – day trading

Start by doing a little research on either starting a business or developing your preferred skill and based on what you discover from this research, write down your top five goals surrounding your project of developing that skill. 

This should include a financial goal, such as making $7,000 in sales or $10,000 in trading profit each month. 

The other goals should include important milestones on this journey that help you reach your financial goal, such as creating and launching your first online course, or passing a prop trading challenge, like the FTMO challenge

Step 2) Develop Your Skill

This is where we get to work. Your next step is to develop your skill. 

If you are taking a skill you already have and turning it into a business, then during this stage, your focus is to develop the skill of running a business. 

You’ll want to learn as much as you can about marketing and sales strategies, how to turn knowledge into a product, like a course or a book, as well as how to create a system that runs the business itself. 

So During this stage, you will put a great amount of time, effort, and probably money into learning this skill. 

Some ways you can go about this include finding information on youtube, blogs, reading books, paying for courses, and even finding a mentor to guide you in developing this skill. 

The secret to becoming great in anything is to find people who already do or have what you want and learning from them so as to avoid unnecessary mistakes and take a faster journey by learning your skill in an organized and systematic way. 

Let me reiterate that last part – this path of developing your skill should feel organized and systematized. 

Take notes and review what you learn regularly. 

Track your stats in order to figure out what to improve. 

Also, make sure you’re putting time into practicing your skill almost every day. 

There are certain things that can only be learned by doing them yourself. 

It can also be useful to find groups of people who are learning this skill and build relationships that help you reflect and grow.

Before moving on to the next step, I want to note that this stage of developing the skill will probably take more time than you think. 

Based on my own experience with day trading and learning about how to grow a business, as well as what I’ve observed in other people’s stories of capitalizing on a skill, I’m going to suggest that you can expect to stay in the development stage for at least 1 to 2 years. 

This doesn’t mean that you can’t earn money right away, but to get to that special level you outlined in your goals from step one, be ready to play the long game. 

Impatience will likely come with some costly mistakes that you might not be able to absorb without burning out. 

Think maybe half-marathon, not sprint and pace yourself. 

{If you’re interested in learning how to day trade as your profitable skill, I recommend reading the book I wrote on how you can leverage the most important habits of professional day traders to set yourself up for long-term success in the markets!}

Step 3) Take Your Skill to the Marketplace

This is the time when you take your business live, you land your first deal, or you trade your first prop trading challenge. 

If you’ve been working on a skill like coding or SEO optimization, this may be the point at which you start applying to and interviewing for roles that demand this skill. 

Make sure the numbers add up – if your goal is to earn $7k/ month then be firm on that amount when you get to the negotiating table. 

If you have other requirements you want to see in a job, like the ability to work from home or bring a dog to work, then keep searching for that optimal package. 

You should feel confident in your skill at this point and know that you are valuable. 

Step 4) Grow, Reap, and Repeat 

At this point, you should feel highly knowledgeable and effective in your skill, and some, if not all of your goals from step one should be accomplished. 

At this point, you can decide if you want to create new goals for yourself to take your skill to an even higher level, whether that means writing a book, turning your lucrative skill into a business, launching a social media platform around your skill, or if you’re a prop trader, then perhaps growing funds for your own account instead of only depending on prop trading firms. 

Also, it’s okay to be content with this new level that you’ve achieved and maybe use it to give yourself more comfort or rest in your life. 

Not everything we do has to be about endless improvement. 

You can come back to step four at any time. 

The one thing to watch out for, though, is to not become so complacent in our knowledge and expertise that we start backpedaling. 

This world is continually changing and often our skills need to adapt to new environments and circumstances. 

So make sure to keep a habit of regular personal development and skill improvement. 

Now that we’ve reached the end of this lesson, I hope you can step away from this video feeling like you have more clarity around what your process to success could look like. 

I believe this is an organic formula that most high performers use to achieve greatness in what they do.

{If you’re interested in learning how to day trade as your profitable skill, I recommend reading the book I wrote on how you can leverage the most important habits of professional day traders to set yourself up for long-term success in the markets!}

It’s also not to say that you need to quit your salaried or hourly position in order to have a better life – as there are plenty of meaningful and necessary jobs that serve a great purpose that requires working for someone else. 

You can use this formula to become more valuable and effective in your field or even develop a business or skill on the side. 

Remember that success is not reserved for the talented, the privileged, or intellectuals. 

Anyone can get started on learning a skill. 

Patience, Perseverance, and Proactive reflection can see you through. 

If you have a skill you think you’d like to learn or grow a business out of, or have already achieved these four steps, please share your aspirations, wisdom, and stories with us in the comments section below. 

 

I want to participate in helping more people feel empowered to achieve a level of success and meaningfulness in life than ever imagined before. 

 

I wish you all the best of strength and luck, take care!

For today’s tutorial, I want to show you how you can keep a digital record of your trading while still enjoying the freedom that comes with writing a journal with pen and paper. I’m going to walk you through step-by-step how to turn a Rocketbook into a day-trading journal you can use every time you have a trading session.

I’ll be transparent and say that I am an affiliate of Rocketbook, but I want you to know that they didn’t ask me – I asked them to become an affiliate because I absolutely love my Rocketbook and I want to help others find convenient ways to use it in their day trading, as well. All good?

Let’s Dive in!

What is Rocketbook?

First, what is a Rocketbook? Some of you might not be familiar with Rocketbook.

The company launched a little over five years ago and came out with an early version of a notebook that you could write on, microwave to wash it off, and reuse it endlessly.

Since then, they’ve updated their products to use special ink from the Frixion line of pilot pens and added designer paper that can be wiped clean with a spritz of water and a swipe of a towel.

Rocketbook has an app that lets you take a screenshot of your page and send it to one of the destinations you link to the symbols on the pages.

For example, you can send it to a file in your Google Drive, Dropbox, Evernote, among others, or even have it sent to your email.

Handwriting recognition software can also translate your printed copy into a typed digital one.

You can find out about more features by checking the Rocketbook website

Also, here’s a link to free samples of their notebook pages so you can try it out without paying a thing.

I personally own the Rocketbook fusion, which I like to use for what I call “brain droppings.” You know, all of those notes you need to write down when you’re on the go.

And just recently, I started using my Rocketbook for day trading.

Why is Rocketbook a Good Solution for Keeping a Trading Journal?

So, why would you want to use Rocketbook as a trading journal?

There are a few ways I’ve kept trading journals in the past.

  • At first, I had a physical notebook but I’d often get lazy and not write out all of the important details each time because I had to write a new template every session. Sometimes I’m not at home when I trade, so I wouldn’t always have my journal on me, since it was kind of bulky and added extra weight.
  • I tried keeping an electronic document for a while but found that I didn’t like this setup either. I genuinely like the feel of paper and pen. I know that I look like I’m 18, but I actually just turned 30 this year and never owned a smartphone or laptop until I was in college.  I still really enjoy the feeling of handwriting and I believe I remember more of what I write than what I type. Also, I tend to stay more engaged when I’m writing than when I’m typing.
  • So For the last year or so, I found a solution through using an iPad and pencil and keeping a journal through a new document on the app Goodnotes. This works really well for my needs, but I still ran into issues when my pencil or the iPad when they would lose battery and I’d be left without a journal for the trading session.

But now I think I’ve found my ultimate answer to this conundrum.

The ROCKETBOOK FUSION.

Using a permanent marker, I could create a template for my day trading journal on one of the page layouts. Then, when I’m trading, I can write what I need to record by hand, and after the session, I can upload it through the Rocketbook app so the entry is saved on my google drive. Then, I can wipe it clean and have it ready to use for the next trading session.

How to Turn Your Rocketbook into a Day Trading Journal

Here’s What you need: a Rocketbook Fusion set, black and/or colored Sharpies, a blank piece of paper, and a pencil. (Optional: a ruler)

First, brainstorm what kind of information you want to record in your trading journal.

You may want to add or keep off more information depending on how many pages you want to dedicate to your journal template. I only want to capture and upload one page per trade, so I’m going to stick to the necessary information I’ll need to properly review my trades at the end of the week.

So what’s the most important stats we should record for our trades?

For me, this looks like writing down the date, day of the week, time of the trade. Whether it’s a short or long, how much money is risked, how many lots were bought or sold, as well as the profit and loss and overall percentage of account gained or loss.

But most importantly, I want to be sure to include a good amount of space to write out my thoughts, feelings, and ideas that come to mind while I trade.

This is the kind of information that you’ll want to regularly review in order to improve your trading discipline and strategies. I’m going to want to split these into different sections, one for recording my thoughts intratrade, and one for any ideas or follow-up tasks I should consider doing after the trade.

When I go over my trading journal at the end of the week, I want to be able to add any tasks to my planner from this section that I can work on over the weekend or the following week. 

Next, depending on how much you trust your writing and design skills, you’ll probably want to test out what your format could look like by taking a sheet of paper and outlining the size of the Rocketbook page.

For the Fusion, the dimensions are “5.25 by “8.6” inches. Then, with a pencil or pen, you can map out some possible designs that would meet your needs.

Then, pick a page that you want to use for your template.

Once you create this template, you won’t be able to wipe it off again, so be sure you’re okay with allocating this page to just your trading journal.

I personally like the dotted graph pages best, but you could also do this on a ruled page, too. Also, decide what color sharpies you need, if you like to add color. I like to use a red and green for my short and long options and a blue for my long-form journal sections to help visually organize the page.

Plot an outline on the Rocketbook sheet with a pencil

For those of you who are gifted with great penmanship and drawing skills, you won’t have any problem here, but for yours truly, I’m going to need to put down a pencil layer first and be sure to take my time. You’re going to recreate your template on the Rocketbook page.

Once this is done, it can’t be removed, so take your time to make it look as clean as you like!

Lastly, let’s put this baby to use.

Be sure to have your Rocketbook, Fuxion pens, some water, and towel ready when you start your trading session. Record as you go and be sure to avoid using any other pens with the Rocketbook than the Fuxion ones.

Since I have a mindless habit of reaching for my pen holder, I’ll make sure my desk is perfectly clean while I trade to avoid making a mistake.

At the end of the session, you can select the preset file you want it to go to (mine is set to google drive), record your sheet with the Rocketbook app by taking a picture of the page, and once the file is uploaded, you can add any screenshots you took of your trade to this document as well.

It’s so freakin simple! And might I add, minimalistic!

So in 5 easy steps and for the same price as a fancy notebook and for 2% of the cost of an iPad, you can have your hand-written cake and digitally eat it too.

I sincerely believe the Rocketbook is one of the most underrated tech tools that can help people minimize paper waste and keep an organized, minimalistic workstation. Again, if you want to learn more or purchase a Rocketbook, feel free to use my affiliate link here. By doing so, you also help support me in my endeavor to provide you free and useful tutorials on trading discipline and forex strategies through this blog and Youtube channel.

I can’t wait to hear about how using a Rocketbook as a trading journal helps you, too.

Best of luck and see you out there in the markets!

Is It Possible to Succeed at Day Trading While in Graduate School?

Hey folks, Andrew Bloom, here! If you’re looking to learn day trading while in graduate school, you’re not alone! It’s completely possible to learn how to day trade while also pursuing academia or professional education.

Me, I’m a Forex day trader who uses only mechanical strategies. My main style of trading is scalping.

I am also currently working on a Ph.D. in Business with a concentration in Entrepreneurship.

Here’s a little backstory

I first started investing in stocks via Robinhood when I was pursuing a master’s degree.

The summer after I graduated with my master’s in nonprofit management and before I started doctoral studies, I started teaching myself how to day trade. Ever since then, I’ve been day trading through the entirety of my Ph.D. education.

Now, to give you some context, I am taking the minimum number of course credits to maintain my status as a full-time student while also giving myself enough time to juggle other priorities.

Therefore, I make a point to trade in a way that allows me to spend less than 15 hours a week in front of the charts.

Thus, I only take a small number of scalping trades with a mechanical strategy that tells me exactly what I need to do and when.

That way, I can just show up and focus on following my rules and then close out early enough in the day to be able to meet all the requirements of my courses, research, and the needs of my business, as well.

It’s completely possible to day trade while you’re also pursuing a graduate degree so long as you tweak your trading style, your schedule, and your expectations to the rigor of both day trading and your academic lifestyle.

I want to share with you five things to keep in mind as you seek to make money from day trading while also working on a graduate degree. 

Let’s dive in!

1) Adapt your trading sessions to the time you can commit to sitting in front of the charts 

First, as you probably already know, when you’re in a demanding graduate program, time is worth gold.

You are often expected to juggle hours of reading research papers and textbooks in addition to showing up to class. Academia is notorious for expecting students to “fake it” because in all reality the amount of work assigned is never practical or realistic.  

day trading in grad school

And because school and life cost money, you probably are working, as well, alongside any research or academic internships required of you to complete the program.

Therefore, what time you do have to commit to day trading will likely be limited. It’s probably not a good idea to expect to use a strategy that requires six or more hours a day of watching the charts.

Personally, I like to use a scalping strategy that’s limited to about three or four hours of chart time each day that I can commit to doing first thing in the morning.

Make an audit of how much time your academic work and personal life require and see how many waking hours you have left to commit to day trading. Then, when choosing or creating a strategy to trade, keep your time limitations in mind.

2) Keep a Beginner’s Mind

By the time you’ve reached graduate school, you might be feeling some pride in your ability to learn and achieve. Some of you watching this might have aced your entire way through school.

So when it comes to the early months of day trading when you’re making mistakes left and right and it’s costing you money, it can feel painful to realize that you can’t perfect your trading experience.

I’m telling you this from a place of empathy because perfectionism is something I’ve struggled with off and on throughout my own life. It’s crucial to accept the losses that come with day trading and to give yourself plenty of self-love as you stumble along and gain your bearings.

In this way, remember to keep a beginner’s mind, kind of like how it might have felt to take your first college introduction course on the subject that you are now studying in greater depth at this point in your career.

Remember that curiosity, passion, and willingness to keep learning will help keep you confident enough to persist. Maintain that kind of mindset when you’re discovering how to trade the markets and overall, stay humble.

WANT MORE TIPS AND TRICKS FOR MAINTAINING AN OBSERVANT, BEGINNER’S MIND IN FRONT OF THE CHARTS? Be sure to read The Seven Habits of Successful Day Traders: A Quick Guide to Profitable Day Trading PracticesThe Seven Habits of Successful Day Traders Andrew Bloom

3) Take breaks and days off from trading as it supports the demands of your program

Day trading for profit requires discipline and discipline requires a strong mental fortitude.

If certain periods of your studies require extra time and demand on your energy, such as with finals week or when writing a thesis or dissertation, consider taking a break from the charts during the days or weeks that require your full focus on school.

I know it’s not ideal to miss out on opportunities in the markets, but you’re shortchanging both your ability to make responsible decisions in your trading and your ability to perform your duties as a student if you force yourself to trade when you’re overworked or feeling more stress than usual.

Another tweak you can consider is changing your trading frequency, such as looking to swing trade during these more intense periods of the academic calendar.

In my experience, I’ve actually found taking breaks from the market to be relieving and even a form of recovery as it releases the pressure to trade and allows me to sleep in a bit. 

4) Treat learning how to day trade with the same diligence and effort that you apply to your studies

At this point in your academic career, you’re probably aware of what helps you learn best. Whether that means utilizing video resources over books or making flashcards for terms you’re unfamiliar with, you can apply this self-awareness of your learning style to studying trading skills and markets.

For me, I like book learning a lot because I have an affinity with the quiet thinking that comes with reading. I can go as slow or as fast as I want when I read a book and I can take notes and review the material easily.Day trading in graduate school

Speaking of taking notes, even if you’re only watching videos, I highly recommend designating a notebook for trading notes and keeping it with you while you’re watching.

We are more likely to learn and remember that which we regularly reflect on and review, so having notes you can go over regularly will help you remember the key tactics and rules to succeed at trading.

5) Have realistic expectations about what you can afford to trade and how long it may take to achieve profitability

If you’re new to day trading and Forex, don’t expect to see much of a return during your first year of trading.

This is not a get-rich-overnight kind of endeavor and it’s not a steady paycheck, either.

Trade only what you can afford to lose, so if you need your cash to pay for textbooks, rent, or other necessities, put your money towards those things instead of your trading account.

Be willing to stick with this over the long haul, as you will need time to get used to day trading and with building your trading discipline.

Remember how long it took to get through your undergraduate courses to meet the requirement of your major or to study for the GRE? Succeeding at trading will take time and effort, too, but it’s a thoroughly enjoyable process so long as you do everything you can to improve each week you return to the markets.

That concludes our quick list of tips for day trading while also pursuing graduate school.

Neither trading nor graduate school is necessarily easy but it’s not impossible to succeed at both either! I wish you the best of strength and luck, and I’ll see you in the markets!

WANT MORE TIPS AND TRICKS FOR MAINTAINING AN OBSERVANT, BEGINNER’S MIND IN FRONT OF THE CHARTS? Be sure to read The Seven Habits of Successful Day Traders: A Quick Guide to Profitable Day Trading Practices

 

WORSE THAN FEAR/GREED:

Is There a Day Trading Psychology Foe More Cunning and Dangerous Than These?

There’s a foe that lives close to you.

 

It’s a pesky foe, one that seems to feed off the kinds of people who are attracted to the idea of day trading.

Day Trading Psychology FearIn fact, this foe is nipping at me as I write this.

 

When you first learn about trading psychology, you’ll often hear quite a bit about the dual trading antagonists of FEAR and GREED. 

 

FEAR – the emotion that arises when your trade immediately goes against you and you realize that you need to close a losing trade. It’s the emotion that arises when you get an entry signal but your past experiences with losing are telling you to stay out. It’s the nagging voice in your head that tells you to keep trading that day so that you can cover the week’s losses.

 

GREED – the emotion that waves its cheerleading pom-pom’s telling you to let a trade “GO GO GO!” and hold on past your take profit target. It’s the delusion that believes, “It’s going to the moon!” without defining how far away that moon is or where the boundary lies that signifies an “overshot.”

day trading psychology greedYou need to be able to understand these two feelings.

You need to be able to recognize them as they occur.

And you need to be able to say to them, “I can feel you Fear/Greed, but I’m choosing my rules anyways.”

 

But they are not your true foe. 

 

There’s a more cunning adversary that sends FEAR and GREED your way. Those two are just the messengers.

 

Who is the monster that seeks to sabotage your trading discipline?

 

Perfectionism

You see, you wouldn’t even feel fear or greed if you didn’t have a nagging belief that you ought to trade with 100% accuracy and success every time you put on an order.

 

Who whispers sweet nothings about some lofty standard that exists beyond reality? Perfectionism, that’s who!

[What to read more of my reflections and advice about day trading psychology, be sure to check out my book, The Seven Habits of Successful Day Traders: A Quick Guide to Profitable Day Trading Practices

This blog post is actually inspired by a book I recently read from an author whose writing style I highly admire.

 

Jon Acuff’s Finish: Give Yourself the Gift of Done, is a gripping and inspiring read about how to wrestle and win against the greatest threat to actually achieving our goals and getting things finished: Perfectionism.

 

(By the way, I am not an affiliate of Jon Acuff, I am sharing this recommendation because it’s something I find very valuable and want to pass on to my mentees and students)

 

In Finish, John personifies Perfectionism (as I have done here) as a persnickety and thwarting bedfellow to the best of our dreams and aspirations. He explains throughout the book how Perfectionism tells us a variety of lies in order to prevent us from moving forward and taking action.

 

Some of Perfectionism’s lies include:

 

Quit if it isn’t perfect.

 

Your goal should be bigger than average.

 

You need to wait to do X until you do Y.

 

Among an assortment of other lies that lead us to procrastination, being hard on ourselves, and ultimately failing to achieve what we originally set out to do.

 

As I was reading this book, I thought to myself, “Oh. This is spot-on. Not just for most goals, but also trading! This is exactly what happens when we make assumptions about continuous positive return.”

Perfectionism’s Role in Day Trading Psychology

Perfectionism leads us to believe that we ought to be able to make a regular profit within a few weeks of learning how to trade.

 

Perfectionism fools us into thinking that we should expect an 80-100% win rate.

 

Perfectionism amplifies our feelings of let-down and self-hatred when we make endless mistakes.

 

Instead, we need to get realistic.

 

Let go of perfectionism and choose to keep showing up. Forget about some clean, linear straight line of progress with your trading skills and your total account size. 

 

You might have profitable weeks followed by losing ones. If you’re just starting out, it can easily take two to three years to see your total net earnings in the green. 

 

Just when you think you’ve mastered taking your stop losses or sticking to your rule of three trades or less a day, one day your discipline goes haywire and you do some considerable damage to your account.

 

But before I leave you feeling deflated or hopeless in the face of what is a wild and unpredictable plight ahead, let’s go over a few ways we can make authentic progress with our day trading psychology without letting perfectionism drive the train.

How to Apply These Lessons to Your Day Trading Psychology Plan

Pointers for making realistic trading goals (as inspired by Acuff’s suggestions for stifling Perfectionism):

  1. Cut the goal in half – If you started out with a goal to make 20% off of your account each month, try cutting it down to 0%. Or if your goal is to grow your account to $50,000, trim it down to $25,000 first. In this way, you can take smaller baby steps to your larger long-term goal.
  2. Double the amount of time you are giving yourself to achieve your goal – if you are aiming to be profitable in the next six months, how about stretching that out to at least a whole year (or likely longer)? 
  3. Add on new routines and new trading tactics a little at a time – Through the discipline resources I offer I tend to make a lot of recommendations for different actions to take to improve trading discipline. Instead of trying to do everything at once, pick a few suggestions at a time and see if you can implement them well for a while before taking on new tactics and routines.
  4. Have fun on the journey– It may seem obvious that you would hopefully find some enjoyment out of trading if it’s the endeavor you’re choosing to use to make more money in your life, but once we get into “goal mode,” humans tend to get serious. Perfectionism would rather see you stressed out and doubling down on your intent to profit from day trading. But introducing fun into your routine and your experience can help you stay more serene and avoid anxiety- which is an emotion that tempts us into making mistakes. Instead, allow yourself to stay curious, intrigued by the markets, and make your trading practice and work sessions more enjoyable. Personally, I like to play music when I practice, backtest, and even when I trade live. Trading memes can help you laugh at the problems a lot of different traders make. Always be responsible and diligent, but don’t forget to laugh and enjoy yourself!

Let’s talk about the top five trading routines you can use to develop trading discipline and improve your trading skills!

You know, there’s something profoundly human about keeping routines. Think about some of the routines you keep. Whether it’s brushing your teeth two times a day, having a coffee while reading a self-help book in the morning, or going to the gym four times a week. Perhaps at first when the routine was new, it took more time than it does now and there might have been some

Day trader mentally preparing for scalping

 psychological push back against doing this thing on a regular basis. But over time, you got used to the motions, you memorized the steps of the routine, you were able to start performing the task without effort, and the energy required to start it is no longer demanding.

There are so many things we need to do to survive and stay healthy, so it kind of makes sense, biologically speaking, to be able to become accustomed to a routine in a way that requires less energy and focus to perform as you continuously do it over time. I’m here to tell you that trading well is no different from other routines that keep us well and healthy over time. There are certain things successful traders do consistently which losing traders don’t do frequently or fail to do at all. We’re going to go over the top 5 key trading routines you can keep as a day trader who is aiming for success

Let’s dive in!

Trading Routine #5: Recording the outcomes of your trades in a long-term trading log

Do you know, right now, how much you have returned or lost this particular month? Or how many trades you’ve taken so far? If not, it’s time to start recording your trades in a long-term log. A decent trading log should consist of 3 things:

1. Information from each of your individual trades

2. A breakdown of your return and loss from each week

3. Any deposits or withdrawals from your account.

The purpose of a trading log is to be able to track the return from each of your trades, as well as keep an account of your brokerage account balance. Most of the time, your brokerage can provide this information for you, but it’s a good practice to record this information for yourself so that you are sure to review it and reflect on your overall performance. I find I keep better records when I record my trades after each trading session, but you could also record them once a week, like on a Friday to tie up the trading week, by referencing the data from your brokerage firm.

Trading Routine # 4: Prepare for the week ahead

This routine is not as structured as the last routine, but that depends on what you need to do to prepare for your trading strategies. This could involve preparing on a 

Forex day trading routine preparing night

Sunday morning or evening by checking the economic calendar for the week and writing these times down. It can also involve setting an intention for the week ahead.

For example, if you got too greedy and held past your take profit the week before, you can write down an affirmation that you will be vigilant to avoid doing the same thing this week. I like to trade with the same position size all week, so I’ll usually write down and preset my order sizes based upon the amount of money I choose to risk for each trade. This is also a good time to draw any support or resistance levels from the daily and weekly charts if that’s a tool you like to use to trade.

Trading Routine #3: Mentally Prepare yourself before you trade

Think about high performers. A lot of athletes talk about having mental prep sessions before a game where they help themselves get into a zone. It can be a song that helps them pump up or a warm-up routine that tells their body it’s game time. Remember, your ability to stay level-headed and disciplined while you trade is crucial to your success. So perhaps instead of getting too wired before you trade, you’ll want to keep a start-up routine to help you get centered and focused. You can meditate before you trade or write out a declaration for yourself that you’ll say aloud, promising yourself that you will follow your trading rules today. This is also a good time to quickly reflect on the biggest trading mistakes you want to watch out for. 

So too, performing a visualization of yourself following through on your trading rules can also be beneficial. By the way, if you want a free checklist to help you follow through on some of these daily trading routines, you can download it here. Your headspace is the worst place to store your ideas and commitments. It’s better to have visual reminders of what we need to do to succeed and checklists are a handy tool used by professionals to ensure they follow through on their services. Okay, let’s move on!

The next two routines we’re really hard to rank. I couldn’t decide which one is more deserving of the #1 spot. But I think I made the right choice and I’ll tell you why soon. 

Trading Routine #2: Journal your trades

This is different from keeping a trading log.

A trading journal is where you can record not only the data of your trades but also any thoughts or emotions you had while you traded. Since intense emotional experiences are often the reason why many of us make mistakes while we trade, it’s helpful to write them down so we can discover what mental states or situations we need to improve.

For example, you could be waiting to take your stop loss, but as the price gets closer, you decide to move it out of the way to another price that is risking two to three times more than what you intended. During that moment you may be feeling intense anxiety. That’s one of the best times to write down what’s going on and why you’re feeling that way. Getting this out on paper may help you recognize that this is an emotional reaction and help you return to your rules.

That’s also why I like to add my trading rules to my trading journal so I can see them while I record what’s going on. If you want to see an example of this, I made a free trading journal for the once-a-day Disciplined FX scalping strategy I posted here on the Disciplined FX blog.

When keeping a trading journal, be sure to fill it out every time you trade, while you’re trading. Some people, myself included, like to take screenshots of the trade and store them in a distinct file on the computer. This is helpful for recognizing patterns in the market and in your trading behaviors. However, there’s one more thing you need to do with your trading journal and that helps us segue to the #1 routine on this list

Trading Routine#1: Review Your Trades

The top routine you can keep for your trading practice is to review your trades. Now, it’s a lot easier to review your trades when you have a trading journal and a log. But the reason why a review session is number one on this list instead of journaling your trades is that collecting information can only do so much for us. We have to analyze and act on the data we collect in order to make the best use of it. For this routine, I recommend sitting down either at the end of the trading week or right before your next one and go over every trade you performed that week. Look at each individual journal and notice what kinds of thoughts and feelings you experienced with each trading day. If you saved screenshots of your trades, go over these as well. Pick out which trade was your best trade (that is, the one in which you followed your rules to a T), and which one was your worst. Notice what mistakes you made and think about ways you can improve. This is also a good time to calculate your profit and loss for the week. I like to review my trades on a Sunday evening so that they are fresh in my mind for the week ahead. 

So, let me know in the comments below which trading routines you want to focus on including in your trading practice. Are there any routines that I missed that you think also belong on this list? Your insightful and respectful feedback is always appreciated!

If this is your first time thinking about keeping trading routines, I recommend beginning with the top two, which is keeping a trading journal and reviewing it once a week, because this practice will have the greatest effect on your trading discipline and confidence. By examining what’s going on when you trade, you can help dispel some of the confusion and anxiety that comes with learning how to trade. I hope this list has you thinking about the ways you can structure your trading for success. 

Best of strength and luck, and I’ll see you out there in the markets!

 

Have You Ever Tried Scalping in Forex Markets?

First off, if you’re new to the concept of forex scalping, I want to apologize for the horrid term. Whenever my non-trader friends ask me what I teach, I always get a concerned face because of this term. I’m going to take an educated guess and say that it’s likely that this was a term that came into play sometime around the same period when brokerages moved online and high-frequency trading became a common way to make a lot of money in the markets. So, 1980’s, maybe 1990’s? And we all know how culturally sensitive and gentle the social norms were during that time. (I’m being sarcastic, just to clarify) I’m also comfortable with being wrong about this theory, but either way, I’d love to see new slang come into the purview of the English trading lexicon. How about something like, “Swiping,” or “Tinder-Style Trading”? Not much better, huh?

 

Okay, let’s get serious! 

 

Today, you’re going to learn a new swiping/scalping strategy that can be used on the EUR/USD once a day. 

 

What are some of the benefits of using a strategy that only trades once a day?

  • You can keep your day trading session as short as possible
  • You avoid running the risk of breaking rules by spending less time in front of the charts, and therefore, will not be tempted to over trade or make impulsive trading mistakes
  • You can day trade while also keeping a full-time job or going to school or parenting young children or doing whatever activity that brings you joy and fulfillment in life and requires your time
  • It can be helpful for transitioning to day trading from investing or swing trading

 

WANT TO WATCH A STEP-BY-STEP TUTORIAL OF THIS STRATEGY? CHECK OUT THE VIDEO BELOW

WANT A PRINTABLE VERSION OF THESE DIRECTIONS AND A PDF OF A TRADING JOURNAL WITH THESE STRATEGY RULES? ENTER YOUR EMAIL AND WE’LL SEND YOU THIS KIT!


I remember when I was first learning how to trade. While it was exciting to learn about and participate in what I thought would be a “quick” way to make money, for months and months I felt so confused. I didn’t really know what to do or how to find or create a strategy I could trust. There are plenty of strategies available for free on the internet, but a lot of them felt really vague and rarely did anyone also post evidence that it worked in real time. Furthermore, a lot of strategies only work well during certain types of markets or during certain times of the day, and a lot of the strategies I came across were being marketed without clarification as to when to use them.

I just wanted someone to tell me exactly what to do! I wasn’t looking for THE ONE STRATEGY that would make me 50%+ return a month, I wanted something that I could sink my teeth into and trust to lead me to a little profit as I worked on weeding out the common beginner trading mistakes, like learning to always take my stop loss or take only five or less trades a day. 

 

Of course, it took some time to learn that if I wanted to find a strategy that I could trust the most, I would have to create one myself. But I didn’t have the experience, knowledge, or confidence to try that approach during my first year of day trading. 

 

Instead, I ended up paying for a strategy online. 

 

While it’s no longer the strategy I use today, using that paid-for strategy helped me to focus on one strategy and use most of my mental energy and time to train myself to stop committing expensive trading mistakes. Part of what made this strategy so useful was:

  • It came with video tutorials
  • The trader showed examples of how the trade worked
  • There was some guidance as to when and how to use it (instead of pretending like it was some catch-all for all markets, all currency pairs, or all times of day)
  • It was easy to backtest

 

I want to offer you something similar, but for free! 

 

I created this strategy with beginner day traders/scalpers in mind. I don’t think it’ll be the only strategy you’ll ever use, but it can be one that you trust enough so that you can focus more of your time and effort on developing good trading discipline. When you gain more experience, you can eventually develop your own trading strategy that works best for your personality, time zone, and personal schedule. Or, if you like it and feel comfortable, just keep using it!

 

So let’s dive into it!

Day trader diving into new easy beginner strategy from free course

First, What is Scalping? How is it Different from Day Trading?

Just a quick word before we get into the nitty-gritty of the strategy. 

Whether you’re new to scalping or you’re a seasoned trader on the hunt for a new scalping method, I want to clarify my own understanding of what scalping is. Because in the Forex markets, scalping can look a lot different from, say, scalping in stock markets or cryptocurrencies. 

Many people may assume scalping to be different from day trading because of the length of time a trade lasts. You probably know that a swing trader will take trades that last for a few days to a few weeks. And that a day trader takes trades that last from as little as a couple of minutes to a few hours, but always closes before the end of the trading day. Some may think that a scalping trade happens over a matter of seconds and mere minutes. 

And yes, sometimes it does!

You’ll see this most of the time with stocks, especially penny stocks.

But I don’t think of scalping as defined by the length of time it takes to trade.

Instead, I think of scalping as a way to define the number of ticks or pips that the trade covers. So if the EUR/USD moves 100 pips in a day, I would say a forex scalping trade is one that takes out less than 20 pips (20%) of that day’s range. Even if that one trade takes half an hour to close, I would still consider it a scalping trade.

You’re going to find with this forex scalping strategy that even though we are going to (usually) capture less than 20 pips on a trade, the entire trade may take more than an hour to complete. 

Summary: Scalping trades are those that seek to capture a small amount of pips/ticks/points. Sometimes this happens within a few seconds, sometimes this can take more than an hour to complete. It all depends on the market you trade.

 

The Disciplined FX Once-a-Day Scalping Strategy: THE OVERVIEW

 

Okay, so now that we know what a forex scalping trade looks like, we can talk about how this scalping strategy works and why it has a favorable probability of performing well for the EUR/USD when the NYC stock market opens.

 

THE PURPOSE OF THIS STRATEGY IS TO LET YOU, YOUNG NINJA,  PRACTICE WITH A WOODEN SWORD INSTEAD OF STEEL

This is not the only forex scalping strategy you’ll ever trade.

This is not a holy grail.

This is not a strategy meant to earn you ginormous amounts of profit in a mere number of days.

checking new strategy works for forex EUR/USD

This is a strategy that takes the stress and pain out of researching and hunting for a profitable strategy and instead ALLOWS YOU TO FOCUS ON DEVELOPING DISCIPLINE when you’re first learning how to trade with rules!

 

All clear? Good!

 

The thinking behind this forex scalping strategy is that when you observe trends on the 5-minute chart, rarely do they keep plowing in the same direction all day long. Once the London markets close for the day, often any trends from the cross-over of the London Close and the NYC Opening lose their steam and start to pull-back or enter a range. Not always, but often enough that we can make a profit of it. That’s when we want to pop in for a quick swipe of a few pips!

 

As someone who has spent almost the entirety of his 12 years of adult life in academia, I don’t want to try to convince you of anything without first showing you some evidence. It’s not ethical, or influential, to do otherwise. 

 

So, here’s a screenshot of a backtest I performed for this strategy at the end of May 2021:

ATR = Average True Range at time of trade entry

R = ratio of pips won or loss to the number of pips risked

Wait, What’s R?

In this instance, R stands for “Ratio” and represents your risk-reward ratio. If your stop loss is 5 pips and your take profit is 10 pips, then you would have a risk-reward ratio of 2. For what you are risking, you are returning twice as much when you win.

I like calculating R when backtesting because it allows me to get an idea of what kind of profit this strategy could return for different levels of risk.

When you combine R with the percentage of your account that you’re risking each trade, you can figure out how much you would make on this strategy (assuming you risk the same amount of money each trade).

For example, if you are trading with a $1,000 account, you may decide to risk 1% of your account for each trade. That means that you would risk $10 per trade.

If your risk-reward ratio (that is, R) is 2, then for every $10 you risk, you would return $20. 

Got it?

Therefore, when we add up all of the R’s from each individual trade during this backtest, we get the sum total of 5. If you had risked 1% of your $1,000 account on each trade, then you would have returned 5% of your account (which is $50).

If you risked 2%, you would have returned 10% of your account ($100)

If you risked 3% you would have returned 15% ($150)

 

But before you start thinking you can go risking 3-5% of your account on a single trade, Look at that third week of the backtest sample. Three losses in a row. If your first week trading resulted in a loss every day, you could have had a drawdown of 15-25% of your account! That’s not good! A rule of thumb is to risk no more than 2.5% of your account per trade.

 

Some Observations from this Backtest:

  1. There were 4 days of no-signal/no-trade
  2. 4 trades resulted in a break-even
  3. 3 out of 11 trades resulted in a loss
  4. 4 out of 11 trades resulted in a win
  5. The third week would have involved sitting through loss after loss
  6. If you don’t include the break-even trades, this strategy had a 57% (rounded) win-rate
  7. If you traded this strategy and went by “feeling”, seeing how you would have only won four times, it probably would have “felt” like you weren’t getting anywhere with this strategy
  8. BUT at the end of these three weeks, you would have been in PROFIT

* NOTE: Backtesting is different from live trading. Sometimes you don’t get the same entry as you would have in a backtest because of the size of the spread between the ASK and BUY. This backtest also fails to take into account slippages and commissions

 

Overall, returning 3-10% a month in Forex is really good!! Actually, given the fact that most people lose when they trade, any kind of profit should be celebrated! 

 

Be careful of what kinds of expectations you place on yourself as a trader and the kinds of returns you think you should be getting from the markets. If you’re new, start with learning how to return any kind of profit. Then, once you’ve developed some discipline, you can try out other strategies that seek to return a higher amount of profit, should you take that route at all.

 

How to Trade the Disciplined FX Once-a-Day Forex Scalping Strategy

Now for the juicy part you’ve been waiting for!

 

Here’s a breakdown of the DFX Once-a-Day Scalping Strategy:

 

THE INDICATORS 

  1. ADX – this is the Average Directional Index. It usually measures the strength of a trend. Often, anything above a 25 is considered a durable trend. Anything below it is considered a weak or non-existent trend. 
  • Settings for the ADX should be 14, WILDERS (this should be the standard setting)
  1. ATR – this stands for the Average True Range. It gives the average size (in pips, from bottom to top) of the chart’s candles over a certain period.
  • Settings for the ATR should be 14 for ADX Smoothing and 14 for DI length (this should be the standard setting)
  1. Exponential Moving Averages – A moving average is the average price of the last length of candles depending on the number/length you select. So if you have a 9 moving average, it would measure the average price of the last 9 candles. However, the exponential moving average is different from a simple moving average in that it gives greater weight to the most recent candles. 

When price moves away from the candles, there’s usually a trend in the direction the candles are moving. If the moving averages are all tied up, crisscrossing each other frequently, then the market is likely oscillating or ranging. 

  • You are going to use 2 different EMA’s
  • The settings for each of the EMA’s = 5, 200 

 

THE RULES FOR ENTRY

  1. This trade can only occur between 930am – 1230pm EST on the EUR/USD (I haven’t tried it with any other pair, but feel free to backtest it and try it in a similar “end-of-one-market-opening-of-another” scenario)
  2. First, note which side of the 200 EMA that the candles are trading 
  3. If the candles are trading ABOVE the 200 EMA, look for LONG/BUY trades ONLY
  4. If the candles are trading BELOW the 200 EMA, look for SHORT/SELL trades ONLY

ENTRY SIGNAL:

  1. You are going to wait for the candles to touch and close ABOVE the 5 EMA if you are LONG/BUY/ABOVE the 200 EMA. Enter a BUY trade (usually via market order) with the opening of the next candlestick
  2. You are going to wait for the candles to touch and close BELOW the 5 EMA if you are SHORT/SELL/BELOW the 200 EMA. Enter a SELL trade (usually via market order) with the opening of the next candlestick

 

STOP LOSS = 1 x ATR (exp: if the current ATR at the entry is 5 pips, then you will put a stop loss limit order 5 pips above/below the entry)

TAKE PROFIT = 3 x ATR (exp: if the current ATR is 7, you will put a take profit order 21 pips away from the entry)

 

MOVING THE STOP LOSS

  1. After the trade moves 1 ATR in a favorable direction (towards your take profit target) move the stop loss to break-even (the price you entered the trade)

 

And that’s it! You take this trade only once!

 

Theoretically, if you know how to set up a moving stop loss, once you’ve entered this trade, you can walk away from the screens and move on with your day. 

 

This trade is meant to help you get started with forex scalping/day trading without having to dive in head-first. 

 

YOUR NEXT STEPS

  1. Set up your charts for this trade.  If you want a walkthrough, be sure to check out the tutorial I made to compliment these instructions
  2. Backtest the trade – Go over at least 100 samples of this trade from the last couple of months to make sure it’s still profitable for this current market. Your results may differ from the backtest report listed above because markets are always changing
  3. Demo Trade or start with a small amount of live cash – before risking your entire account on this trade, try out a few trades with a demo account or by risking a small amount of cash, like $5-$10 per trade
  4. Journal your trades – focus on honing your discipline and following these rules to a T. Note down any extreme emotions you have or if you make any rule-breaking mistakes. Furthermore, stay attentive to any issues that affect the trade, like the spread your brokerage offers or issues with getting your entry filled in time with the opening of the next candle.

 

 

Final Thoughts

I’ll say again, as I’ve said earlier in this article – this is a training wheels strategy not meant to return a whole lot of money, but to get you started with forex scalping and focusing on your own trading discipline. By recognizing that it’s possible to rarely win in a month yet still profit, you are more likely to take your stop losses and follow your trading rules. 

That’s what we’re aiming for – that’s the real WIN in all of this – DISCIPLINE. Once you’ve cultivated discipline, you can trust yourself to try out riskier and more elaborate forex scalping strategies. 

 

If you approach this process in the reverse, that is, get a risky, profitable strategy first and work on discipline once you’re making money, you’re setting yourself up for much loss and failure. 

 

But that’s not going to be you. You’re going to be responsible about this and grow from the experience.

If you ever need more help from me, you know where I can be found.

 

I wish you the best of luck and strength, as always.

 

See you in the markets!

 

Luv,

Andrew

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