The Holy Trinity Of Forex trading

[Russ]

I was talking to my son the other day about the Holy Grail of trading.

Many newer traders are keen on finding the Holy Grail, and if you don't know what that is, it's the one forex trading system that doesn't lose.
The Holy Grail of trading is the perfect system that tells you when to get in and when to get out and never loses.
Unfortunately, this doesn't exist, I have looked for it for many years of my trading career, and for a while, it was actually my job to find it as a system developer.

HOWEVER, I do believe there is something I called the Holy Trinity (in keeping with the Holy Grail theme)!

There are 3 aspects to your trading that, when they work together, you will HAVE to make money.

Trinity Number 1.
Target more than your initial stop loss.

Your basic trade will target the same as your stop loss, meaning this is a 1:1 trade.
When you place your trade, target a little more then your stop loss. It can be as little as 10% more.
For example, if your stop loss is 100 pips, your target would be 10 pips more at 110 pips.
If you were to wine one trade at 110 pip and lose one trade for 100 pips, you would be ahead 10 pips.

Trinity Number 2.
Manage Your Stop Loss To Reduce The Risk.

As the trade progresses, you will usually find an opportunity to move your stop loss towards your entry level.
Again with your 100 pip initial stop loss, you may be able to cut your risk in half by moving your stop loss 50 pips.
If you were to lose the trade, you would lose half of what you would have lost if the full stop was hit.
If you win one trade at 100 pip and lose one trade at 50 trades, you would be ahead 50 pips!

Trinity Number 3.
Win more then 50% of your trades.

While the first 2 options are completely in your control, this third one is a little harder to control.
By default, the super-average trader should win about half their trades and lose half their trades.
By using a decent trading system, assessing the market conditions, following the rules of the system, you can improve your win rate by 5%.
You can go from winning 50% to winning 55%. This means that when you lose, you will lose 45% of your trades.

If you want to guarantee that you will make money in your trading, aim for these 3 things:
Target more than your stop loss.
Manage your trade when you get a chance.
Win just over half of your trades.

I live by these 3 concepts and my trading benefits from it everyday, it will help you too!

Russ