💡Summarize your Strategy/Trading plan/Risk management plan in a few words.👇
Elliot wave theory
A trading plan should include:
1- An obvious strategy in order to make your analysis.
“We use Elliot wave theory, chart patterns, Support/Resistance levels, trend lines, Divergence, Fibonacci, candlestick Patterns.
2- Set of rules to follow in order to look for confirmation/setups.
“We wait for a corrective structure on a lower timeframe such as a 1hour “Flag/Wedge/Triangle” and we enter on a breakout.
3- Rules for Entry/Stops/Targets.
We usually enter a trade after a breakout of a lower timeframe corrective structure, and targets are usually calculated based on Fibonacci Extension levels or potential support/resistance levels, stoploss is usually half the distance of the target to achieve the 1:2 risk to reward ratio.
▪️Risk management plan:
A risk management plan should include:
1- Preferred risk per trade.
“We prefer to risk 1% per trade and aim for 2% return.
2- Preferred risk to reward ratio.
“We usually use 1:2% risk to reward ratio, so if our target is 100 pips then the stop loss would be 50 pips.
3- Maximum preferred drawdown.
We risk 1% per trade and we open no more than 2 trades at a time, so the drawdown is usually lower than 2%, we always aim to keep the maximum drawdown as low as possible “Lower than 5%”. .
. *Please note that the above perspective is our view on the market, We do not take any responsibility for your own decisions.
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