Is it really this "easy"?  Well, the concept is, but like most things, knowing is usually easier than DOING.

Step One.  Identify the market cycle.  Use the the Wave.  Whether you know it or not, every entry strategy ever devised was designed for a certain market environment.  Somehow that fact has been lost and certainly the allure of that one magical set up is tempting for many traders.  It just doesn’t work that way.  Market go up, down, and sideways.  You need a way to enter all, and that means at minimum three entry strategies.

Step Two.  Once you know the direction of the market, now you know which entry style to use.  Simple?  Well only if you know which of your strategies are breakout/down or trend following.  Some of you might even have a range-bound entry strategy.  Have all three?  You’re set.

Step Three.  Confirm your entry with some sort of filtering indicator.  Indicators should not be used to make entry decisions, but they are terrific filters.  I use the MACD Histogram for momentum entries, CCI for reversal entries, and the Wave of trend following.  Occasionally I will use a slow stochastic for range bound entries.

Now there is ofcourse the detail that you must work into these broad strokes…but some trades don’t even do the *obvious* I’ve listed above.  Understanding order entry will give you an edge in getting your price.  Using chart patterns will offer more and better trade opportunities.  Fibonacci levels and pivot will assist you in finding support and resistance levels and trade management.  This is where you trading style can be more personal and designed for your own approach to the markets. 

Each Tuesday we talk about these steps in detail.  Join me here at FX Street for the chart pattern trading webinar each Tuesday and you can see it at work in the LIVE market.

You can also join me tomorrow for the Forex for Newbies webinar at raghee.com.

- Raghee

Hello Everyone, I am enjoying some time away form the office in Dallas this week but we have PLENTY of webinars this week.

Ofcourse, I hope to see you all tomorrow for the Chart Pattern Trading webinar.

We’ll be taking about chart pattern set ups and more…

Also this week is the Forex for Newbies webinar at raghee.com - it will be a step by step presentation about forex for anyone who is just learning about trading foreign exchange.

Last, but certainly not least, feel free to visit my personal blog at http://www.ragheehorner.com

For anyone who hasn’t tried the Autochartist chart pattern recognition, scanning, and alert software - what are you waiting for?  You get a 21-day trial and the INTRO video series…free.

- Raghee

It’s a simple question that most people don’t know the answer to…mainly because no one talks about it or because no one has an answer to the question.

Each and every strategy you’ve ever seen, learned, or used was designed with a particular market direction in mind - whether you what it is or not.  Maybe it’s a breakout strategy.  Maybe it’s a trend following strategy.  Maybe it’s trend reversal strategy.  Maybe it takes advantage of range-bound markets.

Whatever it is, you must know when to apply the strategy.

Now somewhere along the way this idea has been discarded.  I think partly because some people are fooled into thinking that their strategy works in all market environments (wrong!) or they don’t have a reliable tool to determine a trending versus non-trending market.  (it’s not as easy as you think to do in real time)

This video talks about this topic…in fact all the Chartology chart pattern trading videos discuss this as a confirmation step.  It doesn’t matter if you trade chart patterns or not, learning how to identify the market direction should be one of the initial steps in any trading approach.

This is today’s Chart Pattern Trading webinar replay (May 6th).  We talked about a lot of important topics to forex trading success as well as chart pattern trading.  It runs just under 40 minutes and is a terrific primer (if I may say so) to getting a complete view of the markets as well as getting started with some specific chart pattern trading steps.

Get your 21-day free trial to Autochartist and your free INTRO video series here.