Monday, August 21, 2017

How To Formulate Your Own Forex Strategy

December 18, 2013 by  
Filed under Fx Tutorial


In this post today, I am going to teach you how to formulate your very own strategy from scratch so that you will have a reliable strategy to trade with. The techniques to formulate a strategy took me sometime to learn and therefore I decided to write it into a blog post so that every readers of my blog can learn this technique and eventually be able to formulate your very own strategy. In fact, some of the strategies that I am using in my Fx Street University course are formulated by myself.

Therefore I am going to teach you how to do it so that you can also formulate a forex trading strategy for your own use. However you must be prepared that formulating your own trading strategy does really take time. So take sometime to go through this post as it will really benefit you in the long run. Do feel free to give your comments or ask question at the end of this post.

Step 1: Create a General Strategy

In order to setup the general strategy, you must first decide what type of trading style you want to trade. For example: breakout strategy, scalping strategy or trend strategy. Being able to do a proper technical analysis is very important for a trader.

Once you have decided on the trading style, you will then select a few indicators that fit the strategy. If you are not sure which indicators fit which strategy, you can take a look at the forex indicator category on this blog as I have written several articles that will tell you which indicators are suitable for which strategy.

Best Forex Strategy

Now that you have the indicators ready, you will need to decide on the trading setup such as when to enter a trade and exit a trade. However this is already done for you guys here in this blog. In fact, all the strategies blog posts that are written in this blog are general strategy setup.

Forex Strategy Tips

Therefore you can in fact skip Step 1 as I have already done it for you. Just go to the forex tutorial category of this blog and select one general strategy that suits you.

Step 2: Fine tune the Strategy

This is in fact one of the most important part of formulating a forex strategy. This is what actually turns a general strategy into a money making strategy. A general strategy may not be a profitable strategy. In fact, most general strategy do not make much money and that is why we as trader need to fine tune every strategy in order to turn it into a winning strategy.

In fact, those strategies that you have learned in those forex books from book stores or other websites are all general strategies. The money making strategies are those that have been fine tuned by a trader and usually you will only get it in their offline or online courses.

So what you should be doing here is to adjust the setting of each indicators to see if it can gives you a better entry and a better exit. At this point, you should also observe to see if you can setup some trading criteria for this strategy.

Trading criteria are stuff like when you should avoid getting into a trade or what are the situation that you will almost always get into a winning trade.

Sometime, I may try to add another indicator to see if it can make the strategy better. Do note that this step usually take a few weeks to a few months. For every fine tuning you have done, you will have to go to Step 3 to test it out.

Step 3: Back test The Strategy

Usually I do a 6 to 9 months back testing for each fine tuned strategy. What I will do is to record now all the results of each trade and write down the observation that I have done for each indicator during the entry and exit of a trade.

At the end of the back testing, I will do a check to see if it is a profitable trade for every single month of trading. For me, as long as the strategy have one losing month, I will go back to Step 2 to do another minor fine tuning. At the same time, I will try to establish a criteria from the observation that I have done in the backtesting.

Step 4: Rinse and Repeat Step 2 until you have a profitable strategy

After you have done your back testing, you will consider it done when your strategy manage to make profits for you every month for the back testing period.

If not, you will then rinse and repeat Step 2.

Formulating a profitable strategy takes a lot of time but it is worth every seconds of your time as long as you manage to formulate one that can make you profits every single month without fail.

It took me close to a year to formulate the 8 strategies in my Fx Street University but I will say that it is worthwhile as it is making money for me every month since then. So you have to be patient if you want to have a strategy to call your own.

I hope that you enjoy this article that I have written for you and you can try to formulate one strategy for youself now.

You can definitely be able to formulate a great forex trading strategy for yourself using the method above. These are the exact same steps that I use to do it for my own trading.

However if you do not want to spend time formulating your own strategy, you can take a look at my Forex Street University Course below which will teach you the 8 strategies that I have formulated for myself and they are the exact same strategies that makes me consistent income from trading all these years to allow me to quit my day job as a process engineer to become a full time trader from home.

I understand that a lot of you have been very cautious when looking for a forex course as there are a lot of lousy courses that are created by marketers trying to make money from those of you who are interested in trading. These people are not real traders and this explains why those strategies that they teach do not work. In fact, I have purchased several low quality courses when I am new to trading and therefore I understand your concern. You can take a look at my course but do not rush into buying it, have a feel of the way I teach in those articles and videos in this blog before you decide if this course is for you.

Click Here To FInd Out More About My Fx Street University Course

Upon constant request from readers of this blog, I have started a Forex Signal Service that will help you to trade your account using 1 out of the 8 strategies in my course.

If you will like me to trade your account for you and help you recoup back your previous losses or help you grow your trading account, you can take a look at my Forex Signal Service below

Click here for my Forex Trade Copier Service

For those of you who are totally new to forex trading, I will suggest that you read through this blog post that I have written for beginners

Forex Trading For Beginners

If you are interested to learn how I do my forex technical analysis, you can take a look at the post below

Forex Technical Analysis Tips

Comments

11 Responses to “How To Formulate Your Own Forex Strategy”
  1. joseph says:

    I love the way you explain the ADX Thanks a lot.

  2. Arjun says:

    Hi Kevin,

    I am a student and is the course still available with installment option? and am I able to see all 5 modules at once rather than watching it separately one by one?

    Thanks very much

    • Lee Kelvin says:

      Hi

      The course is designed in such a way that you will receive one new module every 3 days so that you have time to practice each module before you move on.

      However if you wish to have all the modules, I can give you access to them at once but you must remember to practice them slowly one by one

  3. Jentzen says:

    May I know is it possible that the strategies you taught will not working in the future?

    • Kelvin says:

      Hi Jentzen

      I have been using those strategies for years since 2009 and I have not done any updates to them since then. I am still making consistent profits with them every month and therefore I believe that the strategies that I teach will continue to work in the future.

      • jentzen says:

        Hi Kelvin,

        Actually, I’m using your piggyback strategy earning quite good profit, but i just worry one day it won’t work and cause me have to work as employee again. lolz.

        Thanks.

        • Kelvin says:

          Hi Jentzen

          Great to hear that my piggyback strategy has allowed you to trade for a living. Well Done!!!

  4. Steve says:

    Hi Kelvin,

    Is it true that even if you have profitable strategy that can make money but if you are not full time monitoring the computer, it will become useless and you will lose the chance as commented by Cheryl Ong?

    If so, how do you spend your time a day monitoring the computer?

    Thanks.

    • Kelvin says:

      Hi Steve

      Not really. If you only have abit of time everyday to trade, then you can choose to trade off the higher time frame like the hourly or 4 hourly chart.

      With the 4 hour time frame, there is only one additional candle every 4 hour and therefore with lesser time to monitor the chart, the movement on the higher time frame is slower and therefore allows you to get into trade on time.

      If you want to trade on the 15 minutes chart and only have 1 hour a day to look at the chart, you will find that you tend to miss out on quite a number of trades.

  5. cheryl ong says:

    Dear Kelvin,

    Merry Christmas & Happy New Year to you and family.

    I would like to seek your opinion regarding robot trading, will it be profitable? Following your strategy is making money but mst of the time loss the chance because not full time monitoring the computer, so why not convert your strategy into robot trading? Do you think it will be better work on this way?

    • Kelvin says:

      Hi Cherly

      Happy new year to you and your family too.

      In fact, you are not the first one telling me to setup a robot trading software. I am working on something for you guys this year but it is definitely not robot trading as I am not a fan of it.

      Shall let you know once it is ready.

      Cheers!

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