Strategy Refinement

I have read Trading In The Zone and I’m 137 pages into Trading With Your Gut. Here is what I have learned:

  • Choose a set of a market variables that define an edge
  • Trade Entry
  • Stop-Loss Exit
  • Time Frame
  • Taking Profits
  • Trading in Sample Sizes
  • Accepting the Risk


  1. I am going to focus on the first four for this blog post and for the next week. The market variables that I will use are primarily support and resistance levels used alongside MACD, RSI and Bollinger bands for confirmation.The primary charting tool will be to give me this edge.
  2. The trade entry must be based on trigger behavior. S/R levels along with the overall trend and direction are used here.  Trend can be determined using Weekly and Daily Charts. Then entry is determined based on the Risk Reward Ratio (>2:1)
  3. Stop-Loss Exit is when the trade no longer makes sense and the absolute maximum risk you must take to determine whether or not the trade is worth it. It’s all about speculation and troubleshooting, but after a certain range, the trade is no longer “to-be-determined”. It’s just a bad trade bro.
  4. Time frames must be consistent for entry and exit. So the time frame I most prefer is the hourly for support and resistance entry and 15 minute chart for the details.

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