CHARLIE BOWDEN 2019 - WordPress.com

Document written and published by Charlie Bowden on 01/11/2019

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CB – Pattern Trading Guide Version 0.1

A technical trading guide for identifying key patterns and trading them on all

financial markets

This technical document has been created by and is owned by Charlie Bowden. It is not to be distributed without the owner’s permission and should not be

copied or manipulated in any way.

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Prologue: The purpose of this trading guide is to provide you with the necessary tools and knowledge to analyse the financial markets and identify and enter trades based on the re-occurring patterns you can find. This guide will not include every pattern that ever “exists” because there are too many and, in my experience, most are not that easy to spot and are not very effective either. I am a fan of keeping it simple and you will see that my charts and the main patterns I use are all very simple. This means I spend less time hesitating before entering trades and this helps me to be more effective and profitable in the long term. Every software, technical indicator and programme used in this strategy is available on the internet and is 100% free of charge. I cannot begin to stress the importance of reading through the whole document before you start trading because as with all trading strategies, they only work if you use everything in conjunction with each other. Trading isn’t for everyone and I would always recommend practicing with a demo account before risking your hard-earned capital. That being said, demo trading is easy. There are fewer emotions involved and very little at risk. Trading psychology is not covered in this technical document but at the end I will recommend some excellent books that do cover this subject. Getting Started: Your Personal Trading Infrastructure: Before you can start trading the financial markets you will need a few key items and an “infrastructure” in place. The financial markets are global and accessible by anyone so long as you know what you are doing. This is what you will need:

1) A laptop or PC with internet access. 2) A financial market charting software – I use Trading View and Meta Trader 4. 3) A brokerage account for placing trades.

There are many different charting software providers and brokers out there so do your own research. Some are better than others and in the case of brokers, there are scams out there that will take your capital and not return it. This is a technical document written to explain a how to trade using patterns. I am not going to dive deeper into the setting up of your trading infrastructure but there are many articles online that can provide you with more detailed information.

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Basic Technical Trading Terminology: It is almost possible to say that trading has its very own language. Trader’s use a lot of terminologies to explain what’s happening in the markets with their analysis and how they are entering and exiting trades. I will outline below a list of key trading terms you will need to know and understand to use the techniques I am about to explain. The explanations of these trading terms can be found online at www.babypips.com or www.investopedia.com

• Pip – Price Interest Point or Percentage in Point • EMA – Exponential Moving Average • TL – Trendline • Fibonacci Retracement Levels • Candlestick Formations • Price Action • Take Profit • Stop Loss • Reward:Risk Ratio (R:R)

The above terms are all used in the techniques I am about to teach you via this document. It is imperative that you learn them and understand them, as without this knowledge you will certainly lose trades and therefore also lose your trading capital. What Financial Markets should I trade? Theoretically, you can trade any financial market but naturally some financial markets react better and are more profitable over the long term than others. There are various financial markets you can use this strategy to trade on and I have listed the main 3 below:

1) Foreign Exchange (FX) – World Currencies traded in pairs against one another. 2) Indices – A portfolio of stocks that represent a market. 3) Stocks & Shares – Individual stocks. 4) Commodities – Gold, Oil, Gas, Wheat

Each market has its own individual benefits and weaknesses and some strategies (including this one) are more profitable on some markets more than others. It is down to you as individuals to test this strategy on multiple currencies, commodities, indices and stocks to confirm your preferred markets. You can find more information on each of the financial markets by clicking here.

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Initial Chart Setup: In theory, the key trading patterns I am about to show and explain to you appear on all timeframes across most financial markets. Therefore, there is no definite timeframe that you need to have your charts set to. I trade patterns on the 15-minute, 1 hour, 4 hour and daily timeframes depending on what I am trying to achieve in terms of Reward:Risk and what the markets are doing. Patterns are mainly structure based and identified by how price action appears with candlesticks. This means your charts can be kept very clean and tidy with no indicators or moving averages needed. The main tools I use are trendlines and the Fibonacci retracement tool when trading patterns. However, although I say that pattern trading is simple, it is also very heavily reliant on the trader’s experience and discretion. If you are looking for a more mechanical trading strategy then I would suggest reading one of my other trading strategy documents called “CB – Day Trading Strategy 1 Ver 0.2”. Here is an example of my chart when I am looking for patterns to trade. This is the AUDJPY FX Currency pair on the 4hr timeframe. I will show you examples of patterns on various financial markets but you will probably notice that I am heavily bias to FX currencies as they are my specialty.

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What patterns do I trade? There are many types of patterns to trade, if you simply Google “Trading Patterns” you will find hundreds of examples. If you look at the charts for long enough or in a particular timeframe or view then you will almost always be able to find an example of where the patterns appear but that doesn’t mean they work in the long term. You will be able to go on to any trading forum and find someone who is claiming to be profitable from trading obscure harmonic patterns like “The Crab” and “The Butterfly” but I don’t use these. The 3 main patterns I use when trading are as follows:

- Flag Continuation - Wedge Continuation - Head & Shoulders Reversal Pattern (Inverse)

These patterns can appear in many forms and will not always be picture perfect, it is only practice and experience that will eventually make you a better trader when using patterns. To identify these patterns, I follow my normal process of top down analysis whereby I start with the higher weekly & daily timeframes and go down to the 4hr, 1hr and then 15min timeframe charts if necessary. Another benefit of trading patterns (at least on the higher timeframes) is that you do not need to spend all day sat in front of the charts. With practice you can begin to notice when certain patterns may form and then anticipate the entry zones and just routinely check the chart every few hours. If you are trading the weekly and daily timeframe charts then you may only need to check the markets at the end of each trading day. These patterns can work for both bullish and bearish entries and I will show you examples of both for all 3 of my favourite patterns. The basic line versions of these patterns are below.

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Bullish Flag Continuation This pattern is very simple to spot and trade. Bull flags are a momentum continuation trade and are a fantastic entry strategy for getting into a trade when you may have missed the initial entry. This pattern appears on all trading timeframes from 5 minute up to the weekly chart and will therefore vary in size but the basic entry and exit strategies of trading them stays the same.

Bearish Flag Continuation This pattern is the exact same as the bullish flag continuation pattern but entry and exit criteria is reversed and we are looking for bearish momentum to continue. All of the rules are the same but you will be entering a short position instead of a long position.

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Bullish & Bearish Wedge Continuation These 2 patterns are similar to the flag pattern but they have a distinct difference that make them an even better pattern to use when trading. Like flag patterns, wedge continuation patterns appear after a trend phase and are a form of consolidation prior to the trend continuing in its previous direction. Examples of the two types of wedge patterns are below. Bullish Wedge Pattern

Bearish Wedge Pattern

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Head & Shoulders Reversal Pattern The head and shoulders pattern is a reversal pattern and is very well known and frequently used by many technical traders. The basic theory behind this pattern being a reversal pattern is that the trend is reversed as shown by a lower high being made after a higher high is made on a bullish trend. The key components to the head & shoulders pattern are as follows:

1) Left Shoulder 2) Head – A higher high made after the left shoulder. 3) Right Shoulder – A lower high made after the head. 4) Neckline – A zone which spans the 2 lows made between each shoulder and the

head. I have labelled these components on the example pattern below.

You can also trade the head & shoulders pattern for long trades which is known as the inverse. It follows the exact same principle but upside down. The idea being that the bearish trend has been reversed with a higher low being made (inverse right shoulder) and then price continuing upward.

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Pattern Summary: So far, all I have done is show you the very basic “text book” images of the 3 main patterns that I use to trade. This is the basic outline of what each pattern should look like but it is very uncommon to see them appear so perfect in the financial markets. Firstly, I do not primarily use the line chart when trading and instead use the candlestick chart. Therefore, it can be slightly more difficult to spot the pattern that is forming. Practice and experience will make you better at spotting patterns in the long term but another good tip is to switch back to the line chart to check if the pattern you believe is forming does look like the examples I have shown you above. In the following section I am going to show you examples of each pattern using real financial market price charts. I will annotate every chart to show you why they are to be considered the type of pattern it is. I will also give you a detailed breakdown of each trade to show you the possible method of trading each pattern with the potential risk and reward. Bullish Flag Continuation Pattern The first pattern I will show you in detail is the bullish flag continuation. As the name suggest, this is a pattern that forms during a trending market and is useful when looking for position entries to get in to a trending market. The basis behind the pattern is that after an initial trend move the markets consolidate because some traders are locking in profits and price is waiting for its next first direction. Then the trend continues onwards in its original direction after new traders join in on the trend.

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Bullish Flag Continuation Example 1 - AUDUSD

The above example shows you how simple the bullish flag trade is once you have mastered the art of spotting flag patterns forming. For a simple profit target, I like to mirror the previous trend phase that lead up to the flag and apply this to the exit of the flag. This is marked by the purple zones. Key Trade Information: FX Currency Name – AUDUSD Entry Date – 4th September 2009 Close Date – 16th October 2009 Duration – 42 days Stop Loss Size – 290 pips Profit Size – 740 pips Reward:Risk Ratio – 2.55 : 1 Carry – Negative Entry Criteria – Bullish flag continuation pattern. Lower risk break out entry. Exit Criteria – Profit target reached.

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Bullish Flag Continuation Example 2 - AUDUSD

I have used the AUDUSD FX Currency pair again for this example because it will show you that not every flag pattern forms a picture-perfect image. I have marked on the trend and consolidation phases along with the trade entry and exit and this time, you will notice that the flag pattern actually formed a small bearish trend as part of the consolidation. It made 2 lower highs and lows before continuing on with the flag breakout and bullish trend. This trade is a very good example of when to take the riskier entry and the benefits of doing so. I entered on the 3rd bullish daily wick rejection of the lower flag line and this also coincided with a 3rd touch of that line. It was clear that there was enough support at this zone to hold price and the probability of the next move being bullish was high. The main benefit of taking this riskier entry was that the R:R of the trade was now over 9 : 1 because of the smaller stop loss and larger distance to my normal target profit. Key Trade Information: FX Currency Name – AUDUSD Entry Date – 13th July 2009 Close Date – 16th November 2009 Duration – 126 days

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Stop Loss Size – 170 pips Profit Size – 1568 pips Reward:Risk Ratio – 9.2 : 1 Carry – Negative Entry Criteria – Bullish flag continuation pattern. High risk, lower flag bounce. Exit Criteria – Profit target reached. Bearish Flag Continuation Pattern This pattern is the exact same as the bullish flag continuation pattern but entry and exit criteria is reversed and we are looking for bearish momentum to continue. All of the rules are the same but you will be entering a short position instead of a long position. As with the bullish flag pattern, this bear flag relies on the market phases theory to capitalise on momentum and enter trades with a high probability of success. I will now show you some bearish flag trade examples. Bearish Flag Continuation Example 1 – CHFJPY

This is a simple bearish flag continuation trade. There is a possibility to drop down to the lower 4hr timeframe on this trade and enter earlier with a much greater R:R ratio. I have marked this zone in yellow.

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Key Trade Information: FX Currency Name – CHFJPY Entry Date – 19th December 2018 Close Date – 3rd January 2019 Duration – 15 days Stop Loss Size – 190 pips Profit Size – 464 pips Reward:Risk Ratio – 2.45 : 1 Carry – Positive Entry Criteria – Bearish flag continuation pattern. Lower risk break out entry. Exit Criteria – Profit target reached. Bearish Flag Continuation Example 2 – EURNZD

I have selected this trade example to show you that the entry techniques in this strategy are not guaranteed to work 100% of the time. This was a higher risk entry set up with a daily pin bar formed at the 3rd touch of the upper flag line which is the criteria I personally use for taking these higher risk entries. However, you will see that the flag line did not hold and I was stopped out of this trade a few days later for a loss.

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Key Trade Information: FX Currency Name – EURNZD Entry Date – 4th May 2012 Close Date – 16th May 2012 Duration – 12 days Stop Loss Size – 165 pips Profit Size – 1697 pips Reward:Risk Ratio – 10.3 : 1 Carry – Positive Entry Criteria – Bearish flag continuation pattern. Higher risk entry. Exit Criteria – Stop loss hit. Bullish & Bearish Wedge Continuation Pattern The bullish wedge continuation pattern is similar to the bullish flag because it forms in a bullish trending market and is a form of consolidation before the next trend phase begins. The wedge can be almost horizontal or even slightly bearish and showing a small pullback, it does not matter. The main thing is that it occurs after a strong bullish trend phase and market price is getting squeezed. The bearish wedge is just the opposite. It will occur after a market sell-off with strong momentum and is often just consolidation before the sell-off continues. The key difference between a wedge pattern and flag pattern is the way price consolidates because, as the name suggests, the wedge pattern shows price squeezing and therefore often leads to a much better trading opportunity. Quite often with a wedge pattern trade, you can enter with a much tighter stop loss and the continuation is a lot stronger which means greater reward:risk and profitability in the long term.

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Bullish Wedge Continuation Example 1 – US Oil

As I explained in the start of this strategy guide, the techniques I am teaching you are applicable to almost all markets. All markets move in phases, all markets trend and consolidate at some point but it is down to you as the trader to find these phases and capitalise on them. This chart is the US Oil daily timeframe and is a prime example of a bullish wedge continuation trade. I have marked the different phases on the chart along with my entry and stop loss placement. The target profit was defined by mirroring the previous trend phase as it was below the nearest key resistance zone at $75.00. You will notice I ignored the large bearish engulfing candle on the 20th April and I did this for 2 reasons. 1) The candle was dictated by a reaction to news and 2) price gapped up on opening the following day and resumed the normal pattern. You could have included the large bearish candle and the pattern would then have formed a bullish flag in which case the entry upon a break of the pattern was still valid. Being able to ignore certain price actions will only come with experience and professional knowledge of the market.

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Key Trade Information: Futures Name – US Oil Entry Date – 1st May 2009 Close Date – 11th June 2009 Duration – 41 days Stop Loss Size – 611 pips Profit Size – 1939 pips Reward:Risk Ratio – 3.17 : 1 Carry – Neutral Entry Criteria – Bullish wedge continuation pattern. Bullish momentum break of the wedge. Exit Criteria – Target profit reached. Bearish Wedge Continuation Example 1 – GBPJPY

The above daily chart on GBPJPY is a good example of how patterns repeat themselves and also how market phases are very apparent in the markets. You will see in the to left corner of the chart we left a wedge pattern (consolidation) before entering a bearish trend phase before forming another wedge pattern. Price consolidated for a second time before forming a nice tight wedge pattern and then producing a good short trade opportunity.

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The entry was on the bearish engulfing candle on the 27th February as it shows the seller momentum coming back into the market to start the next trend phase. Target profit was the support zone at 195.00. This is a key support zone so the chances of price reaching the full distance of the previous trend phase were slim and this was a good plce to take profit. Key Trade Information: FX Currency Name – GBPJPY Entry Date – 28th February 2008 Close Date – 17th March 2008 Duration – 19 days Stop Loss Size – 325 pips Profit Size – 1601 pips Reward:Risk Ratio – 4.93 : 1 Carry – Negative Entry Criteria – Bearish wedge continuation pattern. Bearish engulfing daily candle. Exit Criteria – Target profit reached. Head & Shoulders Reversal Pattern As the name suggests, unlike the other 2 patterns, the head and shoulders pattern signals a bearish price reversal and not a continuation in its existing bullish direction. In my opinion, this makes it slightly riskier because you are betting on an established trend reversing and changing its direction which can sometimes be less probably than trading with an established trend. The key to trading using the head and shoulders pattern is to make sure that you use the pattern its self (shoulder, head, shoulder) in conjunction with other analysis tools like support and resistance zones, EMA’s and the fibonacci retracement tool. The inverse head and shoulders pattern follows the exact same rules as the normal one but it is flipped upside down. You will therefore be looking to enter long positions on the belief that the bearish trend is reversing.

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Head & Shoulders Pattern Example 1 – EURAUD

This example of a head & shoulder short trade on the EURAUD FX currency chart is a good example of how to use extra confluences to enter with the riskier technique. As with previous examples, it is important to keep things simple when looking for these patterns. I have marked on the key parts to the pattern and just like support & resistance, I treat them all as zones because like in normal life, nothing is perfect in the financial markets. Firstly, you will notice that on each shoulder there is actually a double top instead of just a single daily candle high point. This is perfectly acceptable for me and I still class this as a shoulder because the 2 tops are in my shoulder “zones”. You can then see that I have marked the neckline on with a purple zone because again, I am not expecting this to be perfect but if I was taking the less risky entry I would wait for a daily bearish candle to break and close through this zone. Personally, I prefer the riskier entry when trading the head & shoulder pattern because the risk reward is greatly improved and I use the extra confluence of the Fibonacci retracement tool to further improve my odds of the trade being a success. In this example, I applied the Fibonacci retracement tool to the previous swing high (the head) and the swing low (touch of the neckline) and I can see that the right shoulder zone is froing at the Fibonacci 0.618 retracement level which is perfect. This is an extra confluence for me to take the trade and it also provides me with an initial trade target at the Fibonacci 0.27 extension level.

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This is a swing trade so I won’t close the trade at that extension level but I will pay attention to how price reacts there and move my stop loss to the entry price to remove any risk from the trade. My stop loss is placed 30 pips above the left shoulder high to avoid any stop loss hunting and my target profit on this example is at the next key support zone at 1.38. Alternatively, you can mirror the previous trend phase up to the H&S pattern (left arrow) and use that distance as your profit target (right arrow). Key Trade Information: FX Currency Name – EURAUD Entry Date – 3rd March 2014 Close Date – 5th September 2014 Duration – 186 days Stop Loss Size – 270 pips Profit Size – 1567 pips Reward:Risk Ratio – 5.8 : 1 Carry – Positive Entry Criteria – Head & Shoulder reversal pattern. Risky entry at Fibonacci 0.618 rejection. Exit Criteria – Target profit reached.

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Head & Shoulders Pattern Example 2 – EURUSD

For this example, I have chosen the EURUSD FX currency and what was an excellent head & shoulder pattern on the daily timeframe chart. I have marked the chart with key points of this pattern and the less risky entry entering short on the bearish break of the neckline. I placed my stop loss 30 pips above the left shoulder and my profit target at the major support at 1.05 which is also a mirror of the previous trend phase that lead up to this pattern forming. As you can see this trade almost immediately reversed from entry and went on to hit the stop loss. Again, what I want you to take away from this strategy (along with the key parts to building a successful swing trading strategy) is that nothing is guaranteed to work 100% of the time and losses are a major part of trading the financial markets. It is down to you as a trader to accept them and deal with them. Form my experience, trading these patterns works in the long run because their win rate is consistent and the Reward:Risk ratio is above 2:1. What you can learn from this trade example is that by taking the riskier entry at the top of the right shoulder, you would have been able to take this trade risk free on the break of the neckline or at the Fibonacci 0.27 extension level. That would have meant that this trade would not have been a loss but instead a zero trade. The risk entry is shown below.

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Sometimes it pays to be risky. This risk entry ticks my strategy entry requirements because we have a daily wick rejection of the Fibonacci 0.5 retracement level. The increased R:R makes it beneficial and, in this example, it actually gives you more time to remove all risk from the trade. Key Trade Information: FX Currency Name – EURUSD Entry Date – 26th October 2017 Close Date – 24th November 2017 Duration – 29 days Stop Loss Size – 290 pips Profit Size – 1150 pips Reward:Risk Ratio – 3.96 : 1 Carry – Positive Entry Criteria – Head & Shoulder reversal pattern. Low risk entry on break of neckline. Exit Criteria – Stop loss hit.

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Inverse Head & Shoulders Pattern Example 1 – NZDUSD

This example of the inverse head and shoulders pattern is one of the best and cleanest examples I have seen in quite a while. The way the right shoulder reacted perfectly to my key support price level before rocketing upwards to my profit target was excellent. I incorporated the fibonacci retracement tool into my analysis on this one to predict where the right shoulder and higher low might form. The 0.618 retracement level was in line with the previous left shoulder so this zone should have shown support for price which it did. A 25 pip stop loss was all that was needed for this higher risk long position but even a stop loss 2x this size (50 pips) would have produce returns of over 3.5:1 RR. You will notice that the price action around the neckline was quite messy but it does not matter if you plan to enter on the riskier entry method at the potential right shoulder. Even the low risk entry at the break and close through the neckline would have produced some nice returns on the long positions. Key Trade Information: FX Currency Name – NZDUSD Entry Date – 16th October 2019 Close Date – 23rd October 2019 Duration – 7 days

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Stop Loss Size – 25 pips Profit Size – 175 pips Reward:Risk Ratio – 6 : 1 Carry – Negative Entry Criteria – Inverse head & shoulder reversal pattern. High risk entry on right shoulder. Exit Criteria – Resistance zone reached. Advanced Trading Techniques: In this next section I am going to talk you through 2 techniques that I use to further increase my profitability over the long term. These are 2 techniques that can be used alongside the swing trading entries that I have shown you in the earlier parts of this document. You won’t always be able to use these techniques as they rely on you being very patient and waiting for them to appear but when they do appear, they will help you boost your returns. Carry Trades: You will have noticed that throughout this guide, I have been recording whether the carry on each example trade is positive, neutral or negative. This hasn’t been important until now when I am going to explain what this means. The term “Carry” relates to the swap fees associated with trading a financial instrument and is mainly related to trading FX currency pairs which are my speciality. Swap fees are charged daily when you hold a position overnight or through the market close which is 10pm GMT on FX currencies. It is calculated from the central bank interest rate (base rate) differential of the two currencies and is then charged daily to you based on the size of position. All FX currency pairs will have a swap fee, positive or negative, unless both currencies have the same interest rates. If I enter a long position on an FX currency pair like EURUSD, for example, I am buying Euros and selling US Dollars and therefore I get paid the European central bank interest rate on the Euros but I must pay the US central bank interest rate on the US Dollars. This is simple cost of borrowing and lending. I will show you an example of this calculation now for a EURUSD long trade. FX Currency Pair: EURUSD (Euro vs USD) Trade Direction: Long (Buy Euro, Sell USD) Position Size: 100,000 contracts Market Price: 1.14800 Total Position Value: £101,207 GBP (100,000 x 1.148 x 0.8816) Euro Interest Rate: 0.00% USD Interest Rate: 2.50% Interest Rate Differential: -2.50% Daily Swap Fees for this trade: -£6.93 per day (£101,207 x 2.5% / 365 days).

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This may seem small but bear in mind that some swing trades can be held for many months so the costs of this trade can easily increase and become substantial. Now this is where it gets interesting. As a trader, you can look specifically for swing trades that align with the positive swap fees on the FX currency pair you are looking to trade. You can think of it like trading the trendline bounces and therefore trading with the trend. By trading with the positive swap fees of an FX currency pair you will increase your profit of that trade because you will receive an interest payment from your broker. For example, the above example used the EURUSD FX currency pair, you could look for entries to short the EURUSD for a long-term swing trade and then the interest rate differential would work in your favour because you would now be selling Euros and buying US Dollars. Most brokers will list the long and short daily swap fees for each instrument that you are looking to trade so you don’t need to do the mathematics but it is always good to know how the mechanics of trading work. EURUSD is just one example of how swap fees can affect a trade and the interest rate differential is relatively small. At the time of writing this document, some central banks like Japan and Switzerland have negative interest rates. This means that if you trade the Japanese Yen (JPY) or the Swiss Franc (CHF) against an FX currency of a country with a high interest rate like the US Dollar or the South African Rand (ZAR) then the swap fees can be very large. To recap, a good carry trade is when you trade enter a position that aligns with the positive swap fees of two currencies that have a large central bank interest rate differential. The benefits are that the longer it takes for your trade to reach your profit target and the longer you hold the trade, the greater your profit becomes. This is because you get paid fees daily from your broker to hold the trade. At the time of writing this document, the following trades would be good carry trades if the technical analysis confirms swing trade entries as per the techniques I have taught you in this document.

1) USDJPY – Long Trade +2.60% interest rate differential 2) USDCHF – Long Trade +3.25% interest rate differential 3) AUDCHF – Long Trade +2.25% interest rate differential

To find out the current central bank interest rates of the world currencies, please click here.

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Scaling In: (Multiple Entries) This advanced technique is really for traders who have mastered the entry and exit techniques I have explained in this document so far. Scaling in is the method of entering multiple position at once on a single instrument. For example, I have entered long on the AUDJPY currency pair based on a bullish flag continuation pattern on the daily timeframe. Whilst I am holding this trade, another bullish flag or wedge starts to form after the trend phase form the original pattern breakout and if I am using the scaling in technique, I am able to enter a second long position on this flag pattern and set a target profit for this position. If price then breaks out again and starts further trend phase, my profit is doubled. The reason scaling in works and can be used often in the financial markets is because the patterns and entry criteria I have explained in this document repeat themselves over and over again on multiple timeframes. Naturally with increased reward you will have increased risk but by sticking to the entry techniques you have learnt and by using a money management and risk system, you should be able to use the scaling in technique to increase your profits exponentially. Below is an example of where you could scale in on an existing open trade position and exponentially increase your profits. This trade example is actually the bigger picture of a chart I have used in a previous trade example in this document.

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End Note: This document does contain a lot of information and specific details that must be digested and understood to make the strategy successful. You will enter trades that lose. That is a given fact of trading. Not every trade is a winner but if you stay focused and dedicated to a strategy then you can take the losses as they come and focus on winning in the long term. I would also like to use this end note to remind you that this is not financial advice. This strategy is also not guaranteed to win and make you rich overnight. This strategy is not for everyone and it is down to you, the trader, to make it work. I do however, advise you to practice the techniques I describe in the guide before using it with live capital. Practice does make perfect, especially in trading the financial markets. And finally, here are some books I recommend all new and aspiring traders read. They will help you to overcome the psychological aspect of becoming a successful trader and accept the losses and manage wins.

1) Trade Your Way to Financial Freedom by Van K. Tharp 2) A Random Walk Down Wall Street by Burton G. Malkiel 3) Trading in The Zone by Mark Douglas 4) Trading to Win: The Psychology of Mastering the Markets by Ari Kiev

If you have any questions about this trading strategy or would like to learn more then please feel free to email [email protected]

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