welcome to this trading tutorial on a Forex strategy that works so well that I trade this every time it sets up to this day so I've been trading this for years and you know this darn thing just continues to work and work and work it is so reliable
and they like to give you a little introduction to it on this YouTube video and then make the entire trade setup and rules and all that available to you absolutely free if you're interested so here is the Forex trade strategy that works by the way this also works
on stocks emini futures gold crude ETFs pretty much anything you can chart and I've been trading this for years so here it is and let's introduce a couple of general concepts to set up the trade and why it works the logic behind it so it's generally accepted and
I will be the first to acknowledge that there are many variations within this but generally acknowledged in the trading community that there are two types of dynamics in the market that is trending and then reversion to the mean that type of trades so certainly within trend trading we
can include such things as low volatility breakouts that are starting a new trend trend reversals are a type of trend trade even though there were a reversal trade so a lot of different subcategories under trend trading and a lot of people know about that so that is something
that is very well known but I find dent reversion to the mean trades are not quite as well spread throughout the trading community and that's what this one knows this is a reversion to the mean type trade and I like these kind of trades they're not typically as
big of a reward to risk ratio but win-loss ratio on that can be very very high so this can be a great way of making some money while you're waiting for trends to set up and some people say that marks only trend 20% of the time so kind
of nice to have another type of trade to be able to use anyway this is the 50 ma this green line here that's the 50 simple moving average and it's very important that with this type of training you use the simple moving average and not an exponential moving
average or any type of moving average that would be faster so that's one thing that kind of blows people's minds especially beginners they think well wait a minute I don't want the slower moving average on with a faster one because the faster moving average will follow trend and
prey section more closely and ironically that's exactly the reason we don't want it when you want something well think of it this way if you get a moving average that follows close with price it becomes useless the closer it follows price the more useless it is the moving
average they would follow price most closely would be a one period moving average basically just connecting every bar so you don't need that you could see the the price bars so whenever you use any kind of indicator whether it's a moving average or anything else the only reason
to put it on your chart is to show you visually something that isn't obvious just looking at the price bars so when it comes to reversion to the mean you actually want to use a slower and even lagging indicator so counterintuitive to a lot of people most people
think nope I want the fast indicator in in my approach to trading I actually always use a combination of a lagging and leading indicator and it's part of my strategy I use the two in combination together and that really is optimal but we won't go into all that
right now let's just basically focus on the concepts so the 50 ma we use as our intermediate trend indication and this is the type of thing we normally see in grams so prices above the 50 I mean yo retrace here goes up higher highs higher lows etc okay
so that's great that's the kind of thing we expect in the trend and if we can continue going up then whether we see again we see the typical kind of thing that the market then goes in to more of a sideways pattern and we see that by the
50 simple moving average kind of flattening out because it's a moving average we're going to go exactly perfect straight line that goes horizontal it will wiggle a little bit but basically going sideways price action go sideways this is one type of cycle in the market by the way
most people think of cycles of being low high low high low and that is one type of cycle that's the oscillation type of cycle but there are actually many types of cycles and one of them is the trending and non trending cycles markets go three times where they
trend and then they can go two times where they are not trending so that's another type of cycle all right so that's fine then we continue to go on let me show you a reversion to the mean type of example so now we get back into a trending
market 50 I'm a going up price going up your highest higher lows all that great that's what we expect cool works out great come back down now here is what we're looking at okay this is a reversion to the mean type of pattern so now what we have
is wait a minute the 50 I main here is the basic structure it's a price structure type of trade and we had a few extra details to it but here's the general structure of it so now we get something different instead of price continuing to go up as
the 50 period simple moving average is going up we actually have price go down below the 50 period simple moving average for the first time and it goes down pretty hard so it's below the 50 period simple moving average but guess what the 50 period simple moving average
does not move down it continues moving up and that's the structure that is the key price structure now if you used a 50 period exponential moving average or you used a faster moving average you wouldn't get this structure because the moving average will start to move down and
therefore you would not be able to trade reversion to the mean types of trades very well so this is the real structure here we're looking for price bars below again an upward angling 50 period simple moving average and we are looking for it to then get back to
the 50 period moving average that's our first target by the way and then sometimes of course it will go even further and the uptrend will continue so this is a basically what's happening here is a high volatility move to the downside and a short period of time so
we could create a rectangle with that that's what I normally do but this is the structure as you see this is not the norm so these are trades that they do set up you can the nice thing is you can actually scan for these trades pretty easily so
if you have any kind of scanner it's real easy to basically just set up a scan that says you know price bars whether but you want the open high open low close all that stuff the entire bars to be well below the 50 period simple moving average and
then you just put into the scan prices below the 50 ma and the 50 ma is angling up in other words you know the the clothes of today is greater than the clothes of 1 day ago two days ago three days ago something like that to have the
angle of the 50 period simple moving average angling up so that simple little scan program that and whatever scanner you use can help you find these trades because yeah they don't set up a lot or all the time but frankly most of the best trades in the world
are the ones that don't set up that often they're a bit of an anomaly and they seem counterintuitive and that's ironically what makes them actually work because a lot of people aren't going to trade that they don't get it they don't understand the philosophy the mathematics behind it
and the traits that most people take are the ones that don't work the professionals understand you know an anomaly like this is something that gives you an opportunity that most retailers are not going to take so that's the basic structure now there's a few other rules around this
which don't have time for right now I always keep my YouTube videos under ten minutes but I'll give you all the rules everything absolutely free we've got it takes about 26 minutes I've got a video that I'll be happy to share with you absolutely free and shows you
in about 26 short minutes this which I call the rubberband trade it's called the rubberband trade because basically it's stretching away from the 50 ma and then it snaps back to the 50 ma and to sometimes beyond so it's that snapback that makes me call it the rubberband
trade so to get that rubberband trade strategy absolutely free just simply click on the little eye with a circle around at the top right hand corner of this video if you're not watching it on YouTube there's a link below the video or an opt-in form on the side
and once you do that I'll personally email the video to you with the entire rubberband trade strategy with all the rules for timing all the details that make it really work well for you you
