This podcast is brought to you by the award-winning prop firm, Fidel cre,
and is for entertainment purposes only. I'm.
A strong believer of reading the markets and looking at price action.
Price is absolute king to me. So if I can see something, man,
I can see people joke about patterns and I do at times,
but there are certain things that you see there and you see it enough and you
think, ah, yeah.
And then you probably find out that it is a pattern that's well known and
recognized, and I've never found it before, but I've just recognized it.
But I guess, or subconsciously it's there anyway,
I take what's on the table effectively. I use pivot analysis a lot,
which I will show you. So I'll take what's there, not what I want to have.
Basically, in a sense, I'd like them all to be 10 to one.
But the reality of these markets is as long as you can cover your costs and your
strategy has a bullish bias, you can make money. Again, it's a strong belief.
I have, you count in Pips and you mislead everyone by saying, well,
the systems under a thousand pips.
And realistically it's probably done 4% because the amount of risk that you put
on the other side of those. Yeah. What what you gained was,
was just didn't make sense. He was just a blinking good trader.
And the only reason he was a good trader is cause he read price. However it was,
yeah, he would look at price and he, he read price.
He wasn't using all this market matrix stuff.
He was actually just reading the price,
cuz he'd always have an excuse of why he is just done this and why he is done
that. And all he is doing is reading the price and memorial stories.
Just learn how to read price and you can, I,
I can show you how to trade literally without anything else but
price. And I do this at any time.
I didn't care if people can come into my room free of charge for a day or two,
and I'll show them how to reprice.
You can see how you could make money just by reading price action,
put pivots on them price. And it's an absolute dream for me.
I know the stats behind the pivots and I can see the price action,
and all of a sudden I've got an edge in that market.
But I know that edge is gonna work a good percentage of the time,
and a good percentage may be 60, 65%.
Episode 215. What's up traders? We've got Kim Watson here on the show today.
Now Kim's a very experienced trader from the UK who's been around for a number
of years, and he's already told you what it takes to make it as a trader,
you'd really need to know how to read price. Well,
the best traders read reprice.
Now you're gonna find out how he reads price in today's show as well as the
video we shot afterwards. So make sure you don't miss that.
Other things going on here at Trading Up, we've got that livestream opportunity.
If you do wanna jump on the trading up livestream and take part in a 50 K
challenge, we can win $1,000 at the end of it.
Then jump over there onto the livestreams or links under the video or in the
podcast description and take on that Fidel Crest challenge.
Now talking about Fidel Crest,
let's hear from my sponsor and get on with the show.
Fidel Crest is an award-winning pro firm that funds traders with up to 2 million
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So one thing that really says Fidel Crest apart is their no minimum trading days
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challenge. Click the link in the description below.
Or the the card above to find out more. Alright folks,
here we are on Trading Up.
We've got Kim Watson in the house from the Pivot Trader. Fun fact. Uh,
we actually interviewed Kim's business partner from years ago, uh, back in 2018.
Charlie and I believe both of you guys are actually funnily enough into karate.
Is that right?
Well, he's given up, but I'm still doing it. Yeah,
I've been doing it for 40 years now, so.
Wow. 40 years.
Unbelievable. I know, I don't look that old and, but, uh, yeah, yeah,
that it's just, just yeah, around about 40 years this year actually.
Cool. Now it's not just that, but you are also a, uh, professional trader.
Uh, you do swing trading four ex markets. You didn't start off there.
So let's start by hearing your long, uh, trading journey,
and I believe it is quite long. You've been doing it for a long time.
I have, yes. I mean, it started, uh, way back. I,
I got into the idea of trading. It sort of came to me gradually. Firstly,
um, we had Margaret Thatcher in power and she was selling off a lot of companies
like BT and British Gas and things like this. So, um,
everyone said buy the shares, they'll, they'll do pretty good.
So I bought the shares.
So I got into sort of buying some shares and some of them just doubled overnight
almost the, the demand for them was so great. As soon as they hit the market,
there were people trying to buy them. And, um, it, it was,
it was a great start to trading. Um,
the next sort of stage of that was when I was working at a company that then
started offering these, um, uh, buyers or owners. You earn schemes where you,
uh, you would be offered the option to buy the shares at a certain price.
Um, like it's one pound 20, the first thought I bought and I,
in five years time, you can sell 'em for the price you opted to buy them at.
And they were five pounds, 60 or something like this. Yeah.
So every year I was adding to them and they,
they didn't all increase as well as that, but that was the first lot I bought.
And I thought, yeah, hey, this is something in, in this. And I,
I then got given, I sort of got promoted and ended up with, um,
executive share scheme, option schemes and things like this. And suddenly you,
you sort of getting a bonus for doing absolutely not a lot really . Um,
but that, that sort of got me into it. And then, um,
of course I picked up the usual habit of what we do is you hear someone down the
pub talking about a particular share and they said, don't tell anyone.
But he used to, and again, I a look at that and I, I bought some real duffers.
Uh, one of 'em was dragging all, it turned a,
it gave me a return of 5% over per year return when I
eventually sold it. Cause it just hang on, hang on and forgot about it. Uh,
so its a bit of luck really. But, um, it,
oil prices obviously eventually started going up and it had some value,
but it was just a duffer,
it's a real learn not to listen to anyone down the pub really. Um, then,
then I started and we, um, we went on a course actually and, um,
it was run by Tony Robbins organization and it was,
it was all on shares and options,
basically co do looking at covered calls where you buy the share, you sell the,
the option, um, the call option away,
and if the certain things meet the criteria at the end of the, um, the period,
the,
you have average shares called away from you or you stay with the shares and you
just earned the money from selling the option. So, uh,
did that for quite a while. Then 2000 came along and it really, uh,
sort of when the market started going a bit sort of wrong there with the.com
crash, et cetera, it really devalued the, the value of options.
You couldn't make so much money on the options.
And I sort of started then scratching around looking and I was, I was,
I was feeling quite successful. Well, we started then just trading pure options.
We were literally buying,
put contracts or core contracts on different companies. So we, we were really,
uh, wow, I was really overleveraging as well. And it sort of,
there was some major, I mean,
there were times when you just think you're trading God because everything's
going well for you.
And it turned out I was probably just very lucky to start with because then you
hit the sort of, ah, no, um, that's got, you know,
you just lo you just wiped away half your, your, your,
the money you've made and or more, you know,
you sort of right back down to scratch it seems.
So I then sort of got into trading better with,
with some, um, technique and looking at money management rules eventually came.
Um, and, and, and then sort of looked at, uh, I,
I quite like the idea of four x because it is a market that works particularly
well through the London sessions, uh, through, uh, through our sessions.
It's got, I mean, it's got loads and loads of benefits.
There's o obviously loads of problems with it for some people as well,
but overall, if you trade it well, it's got some real opportunities.
So I've got into the fourex market. So, um, and started trading that now. Um,
at that stage, I, I, I'd left work, I've sort of decided this, this was for me.
Uh, and I be, before that I was working for a healthcare company, actually, um,
over here. And I just, I'd got headhunted by another healthcare company,
which I didn't like so much. And I had loads of, loads of time at home.
So I'd already started setting myself up to trade, but I was,
I was just the typical bloke that wants to trade basically in real terms when I
started off. And that, that's where I came from. I didn't go to,
didn't have any of these sort of, I, I knew a lot about shares. Um,
I, I, I've done an N B A, so it's, it is sort of a,
i I knew about businesses and things like this and the principles behind it.
So that was all, you know, knew that sort of stuff. But I liked it.
I liked the idea that you could carry on expanding your knowledge,
you could earn some money if you got it right. And so that,
that was sort of the, the, the sort of starting point.
And from there, really it just, it just grew it, uh, learn.
I'm forever learning. Um, you mentioned karate, you're always learning. Um,
trading is no different. I mean, even to this day, I might see something.
I think I might give that a try. You just pick things up. I, I,
I'm a strong believer of reading the markets and looking at price action.
Price is absolute king to me. So if I can see something,
then I can see people joke about patterns and I do at times.
But there are certain things that you see there and you see it enough and you,
you pick up and you think, ah, yeah.
And then you probably find out that it is a pattern that's well known and
recognized. And I've never found it before, but I've just just recognized it.
But I guess, or subconsciously, uh, is it, is there anyway. But, um,
either way. So I'm always learning. I, I, I, you know, day in, day out, I'm,
I'm learning, I'm testing strategies. Um, I'm, I genuinely believe,
and I've always done this, is, uh,
the biggest problem traders have is their mindset, um, and how they trade.
But they never take it seriously.
They never treat it as a business in the first place.
And there's very few businesses that you would start up and just guess
at, because some blokes sort of taught you on a course or whatever. For us,
this is how it does it. Uh,
but for some reason we do a trading cuz of the greed and everything else that
comes with it. Um, and the desire to a lot of escapism for people.
They think they'll, uh,
earn their money and they won't have to ever work again or whatever else.
So it, it,
I've gone through all those sort of things and I've found the best way to do
things was to test them. Always test them, do the hard work. Um, it's,
it is about,
it's not about just sitting there and some someone's gonna teach you or you're
gonna find a strategy. You've gotta test it because in the, in the, in the,
in the mindset, um, the traders have a problem with,
part of it is the, the belief in whether the,
the whatever they're using is gonna work and get to their targets.
But if you've tested it manually, and I,
I'm a strong believer of manual testing as well,
if you've tested it yourself and you've manually gone back there,
you'll you'll recognize the price. You will, uh,
action when it's doing certain things and it just sort of picks it up.
So when it comes to real time, you are used to that.
And the great thing about technology nowadays, you can roll the screen. I mean,
when I started back in, oh, pre 2000, I used to ring up almost.
It was a case, you know, shares, the shares are bought.
I rang up to buy the shares, the,
the technology wasn't this anywhere near where we are now.
I remember options trading. I,
I was lucky enough to get into the Chicago Board of Options, um, um,
and sorry, the wasn't sure why I went there as well, but I,
I went into the s and p pits and there was this guy standing over the back of
the pits and I asked the guy that had taken us in there,
what's that fellow doing over there? And he said, oh,
he is dealing with the options.
And he was on a little PDA sort of thing and his hands and it, it,
it took it to the phone and it went backwards and forwards. And I thought,
no wonder my trades take so long to set up. I mean,
nowadays it's just like this, but it, it just, oh my goodness, you know.
Anyway. Wow. Uh, sorry, I've, I've probably overs answered your question,
but that's my, my sort of journey into trading. And I,
I've got a real thing with, um, uh, probability. I, I,
I think as I say, the trader mindset needs some,
should have some probability tied in behind it to help it.
Cuz we can do a lot of things to help all the traits that people struggle with.
And what, and what do you do? I mean, you,
you haven't quite touched on what you're doing now, so what,
what are you doing on the here and now?
Okay. Uh, so now I just, I just sort of progressed. I've, um,
now I, I run run a, a, a relatively modest business. Uh, the pivot trader,
um, there, the, the, the, the aim is to, um,
trade in the mornings with the guys. Cuz I, I personally find a,
I've got a window of opportunity between about eight and 10 o'clock London time
and I'll trade that time.
It's my first opportunity then probably 12 to about three. And again,
it's all by analysis. Uh, I've wor worked out when I was taking trades before,
uh, before eight o'clock, the probability of them weren't very gr good there,
there was a lot of false breakouts, et cetera. Um, anyway, so, um, my,
my trading day is that, so I share that time with the guys that, um,
subscribe to my, my channel and the Pivot Trader.
And we literally go on Zoom every day. We take the charts, we look at things,
we take trades,
if there's trades to be taken because it's important to take them live. I think,
you know, if you just work on theory, I've seen people just,
they'll only show you their strategies on slides cuz they don't trade them. Uh,
so you,
you've gotta see them traded and what it really looks like when that on the
right hand side of the chart, when it's actually happening and how, you know,
for some people it's quite scary. Um, me, I enjoy it. Um, it, it,
it's, it, it's, it is, it,
it is quite a nice bit of feedback as you get people hopefully getting
successful and more successful doing it. So, um, that,
that's my sort of morning, my afternoon. So I'm, as I say, I'm testing, I'm,
I'm, I'm doing some recording and I,
I put a load of stuff onto YouTube as well.
The day goes past so quickly. Yeah. Um, and you know, as I say,
got those two major windows to be trading through. So, um,
I trade a little bit of someone else's money, but I'm,
I'm not out there to look to trade major, major money. Maybe, uh,
I might change that at some point when the children go to university. Um,
but at the moment I'm quite happy where I am, um, with, uh, you know,
tra trading myself. I don't have the phone calls of people saying, hang on, it,
it moved it, you know, a little bit down the other day.
They never ring you up when it's going up. But, uh, uh, the guy,
the guys I trade for, they, they've got, uh, absolutely, they,
I don't speak to him for months on end. Um, and that's why I like him.
Yeah. And, and so it's interesting. Um, I,
I spoke to a guy last night or trader last night who's gonna be on the show.
I dunno if it's gonna be before or after you,
but they said exactly what you are doing was the solution.
I e having a mentor that you can actually sit there and watch them take the
trades and watch them at the charts, uh,
it seems to be much more advantageous versus, you know, here's how you do it.
And good luck with that. Yeah. You know, good luck with that. Well, he,
he knows what he is talking about. I can tell you . Yeah, yeah.
Because it is, I mean, I, when I,
even when I started trading options and covered calls and things like this, but,
you know, I, I, I did this course, um, and it's, uh, what is it,
wealth Mastery or something like this, it was called. And I did it,
but at the end, at the end of the day, I came around with it.
I've still got the book somewhere cuz it is a massive folder. And I,
I like everyone else,
I've probably still got it and never referred back to it ever again. Um, you,
you start trying to work out, well how does that work?
And fortunately I come across a guy, he was, um,
he was trying to get a bit of a trading company going himself as in teaching
people. One of Forus he was,
the trouble is he was never very successful with his trading company,
but he was a really good teacher and he really knew options and,
and and what we were trying to achieve and showed us, uh,
and literally showed us live and this is what you're doing in this same place.
It right. This is, and this is what we're doing. Um,
and it was so easy to learn. And that, that sort of made me think, well,
there's no point just putting stuff up on you. I mean,
I put stuff on YouTube and hopefully it gives people ideas to take away and
test and try for themselves.
But there's nothing that beats just literally sitting there looking at screens.
And the biggest thing is, um,
it's when you can't get a trade because everyone's looking at you. So,
oh, uh, they probably are looking at me actually, and,
and thinking why isn't he taking a trade?
Cause the market isn't offering me anything. I've got the patience. I,
I don't particularly wanna sit there and just take a trade to show you how to
take a trade. Um, I'm looking to take a trade because look, we can see this,
this, this is a good strategy here. This makes sense. It's gonna, it is got X,
Y, Z going for it. Um, there's the risk, there's the reward. It's pay,
it is paying its way, let's go ahead with it. And, uh, if it doesn't, I mean,
I I, I couldn't get a trade this morning. And so sometimes I almost feel,
feel like in a sense that you're failing you, you, you,
the guys that are coming into the room. But at the same time,
it's making them aware. You don't have to be a cash is a position ,
you know, you don't have to be in the market all of the time. Um,
and I dunno, I've, this year actually, I, I,
I mean I keep a record of the,
of the trades I've taken in the trade room separately.
So I've got like a list of where we are over the year, um, since I started the,
uh, the pivot trade in March, uh, last year. And so I,
so I keep a running total of what's going on.
I look at the draw down and everything else that we've got. So I've,
I've actually done a sort of four analysis for them,
and which I share with them and we, we sort of run through, um, and it's,
it is doing okay. Um, but um,
I try and encourage them to do all the same things so that they, and, and they,
they know there's times that I, I may get a break even trade. I may, uh,
never even get a trade.
And hopefully it encourages them to realize you can do okay.
Not train every day or every session of the day. You, you, you can,
yeah. It's, it, it's, it's a long journey. It's not like a race or sprint. It's,
it's, it is a, it is a real journey to be trading.
And if you're looking at sort of 20, 30% over a year, um,
I don't think enough people realize that's a blinking good return.
I look at what the, the bar share, hedge, hedge, uh,
bar Barclay's hedge shows in terms of four x traders. I think it's, uh,
9% they did last year. Um, and the,
these are so-called professional traders. Mm-hmm. , so, uh,
hedge funds, et cetera. And you just think, well, if you can outperform that,
you, you, and they've probably got some of the inside information,
or if there is such, well, there is some, there is information, but, um, they,
they may have better information,
but they're still not really knocking out of the path that much.
Now, um, let's, let's dive into, I mean, I've got a ton of questions on the,
what you've mentioned, but we're gonna try and keep the flow and dive into that.
Sorry. Yep. Analysis that you talked about with, you know,
you're keeping a track record of here's what we've done this year, students,
what, what's that look like from a stats point of view?
If you wanted to just sort of reel those out. I mean, how did you,
how many wins? What's the sort of risk to reward kind of thing on the trades?
Yep.
Yep. Okay. Now the risk rewards, I, I'm, um,
lemme just move it over so I can see it as I'm talking to you a little bit
better. Um, yep. Um, I'm not agre, I,
I take what's, what's on the table effectively. I use pivot analysis a lot,
which I will show you. Um, but it's, it's, um,
so I'll take what's there, not what I want to want to have, basically,
in a sense I'd like them all to be 10 to one. Um,
but the reality of these markets is
as long as you can cover your costs and your strategy has a, a,
a, a bullish bias, you can make money. Um,
I actually did a lot of analysis on, I've,
I've got a particular strategy that I've done stacks of analysis on, and it, it,
it does like 20, 30% a year, um, with one,
well now it's down to one currency pair. Cause I've knocked,
I had three currency pairs on there, but the, the, the two on the,
the periphery were basically taken away from it as opposed to adding to it so
often. Um, it, it, it was, it's a great exercise. Been looking,
training it over a number of years and kept all the data on it.
And it, it's, the whole process is a massive learning process because you,
you understand you can have 7, 8, 9 losses in a row on this.
Some of these things, it's one strategy and it, that's how it goes.
But then all of a sudden it absolutely flies.
But the coming back to the risk reward, um,
the optimum risk reward was 1.3.
Now I looked at all of the, the figures and I thought, well,
I wanna automate this. So I've automated it. It's, it's on a little aa, but, um,
because it's easier. Yeah, it is.
It's an easy way if you're not sitting at the screen all day. Just, and I,
I was out today. Okay, I,
I switched it off today cause there was so many speakers coming out today.
So there'll be days I make a decision, well, I'm not gonna trade. Right.
And have it on that day. Yeah. Um, yeah, yesterday I had it on yesterday, yeah.
I had it on. Um, and then today I turned it off yesterday.
It just actually hit me. I confession,
I had the timing this set on the, on, on the, uh, autotrade and it took me an,
it took me a seven o'clock trade, which I'll never, ever take. I'm,
I'm an eight o'clock starter . It took me,
I had two winning trades off it yesterday cuz that's seven o'clock one.
But it's, I've turned it, I've adjusted the time now. But, uh, um, yeah,
it just does itself and I get little pings on my phone and cuz it's using, um,
t4, you, although you can't do it, sorry, apple at the moment, but you can get,
get it to send you messages anyway. So.
So you're looking at like URISA awards one one to 1.3?
Well average.
That would be the optimal Yeah.
That would be that, that's all, that's all one strategy on different strategies.
As I say, it depends on the strategy because some of these things,
if I'm looking for somewhat more of a swing,
I'm looking for two or three multiple, two or three hopefully. Um,
but it, as I say, it depends on what's, what's really there.
I've moved probably most of the trades I've had recently have been day
trades because the way the markets have been moving is that couple of them are
run overnight, but majority of them are day trades. But they're,
if you counted them in pips you think, oh, that's really good. But, um,
in percentage terms, cuz I, I I, and, and, and again,
it's a strong belief I have, you count in pips and you, uh, you know, you,
you can mislead everyone by saying, well, you know,
the systems I a thousand pips and realistically it's probably done 4% because
the amount of risk that you put on the other side of those. Yeah.
What what you gained was was just didn't make sense.
So I just look at risk and reward. Um, I measure everything.
And so I look at multiples of that. I mean, some,
some of my returns have been like 0.6 for whatever it may be.
I may been trailing to stop on it or something like this. So, um, they look,
they look quite ugly at times. Um, be because I'm moving,
moving things, but I'm not, I'm only moving things in, in,
in alignment with my strategy. Um, the, the thing we're trading with and,
and I mean, I'm just looking more recently, I've sort of had 1.4, 1.5,
1 8 6, 1 0.86, 1.9, and, uh, 1.2, 1.5,
1.2. It's a lot of 1.2 is 1.6 on Monday, uh,
lost, lost half a percent yesterday. Um, so my loss,
my biggest loss is only ever gonna be 1%. Um, I never risk more than 1%.
Is that is absolute. Uh, and June, uh, came back after, uh,
Christmas and I only for the first week or so I was on half percent risk. Um,
because it's such a horrible time. I'm just, you know,
looking back historically at my own figures and I just think,
why don't I have an extra week's holiday?
? Yeah, right. Ok. saving.
Money. It's, it's like, it's like September. It's just sort of, you, you,
I I sort of go away in August. This August was pretty good and I looked,
I should really go away in September. It's September's not as good as August.
August is actually right. Um, yeah.
Hanging in there and not doing so bad. So.
Ah, that's interesting. And so.
So.
Variable. How many strategies have you, how many strategies do you actually run?
Um, I probably about four or five.
Um, the, the, I mean, uh, there's,
I've sort of got one completely fixed strategy. The rest are,
I'm, I'm doing my best to make them as mechanical as possible.
Uh, because I, I read price at the end of the day and, uh,
the entry of getting into a price is done by the what I'm reading. Uh, so I,
I have to teach people how to read the price and what you're looking for. Um,
so it's, it's, some of them are, uh, very, very, like flags.
I really love flags if they're in trend. I mean, it's, it's one of the, uh,
people say, why don't you trade flags or whatever else.
They're brilliant if you get 'em right, if you, but I'm using them with pivots.
So I've got this overlap. So I'm using a lot of pivots as my sort of background,
uh, tool. And then I've got three or four pivot strategies that run around that.
So I, I can u yeah. But they,
they just different opportunities that you can use pivots for.
So, um, there, there's great stats around pivots and they're,
they're very easy to ma uh, measure and, and get good, you know,
I know the probability of just about everything happening with a pivot in any
given day. So I say in every given day, I know the long-term probability of the,
the pivots being hit. Um, yeah. And the chances are, I mean, if you look at the,
um, R one s, uh, sorry, r threes, S three s,
if you into pivots and you look at those,
they've only got like a 5% chance of it ever being hit.
So if you are setting targets outside of those in a day and you're looking at it
as a day trade, you haven't really got a lot of chance. You know, you,
you've got 5% chance.
So a lot of my strategies applied around ha knowing what the
market may deliver. Um, I think any fall can take a trade, uh,
and get into a trade. But the, the great thing is getting out of the trade, um,
and getting out of the trade in a way that you don't wanna be leaving loads
back, but you don't need to be coming if you're shorting.
You don't need to be coming out the bottom. If you are going long.
You don't need to be coming at the top. You need a,
you need a point where it's completely logical when, if it's a previous high,
previous low, a pivot or whatever it may be.
I think traders need to sort of wake up and sort of of think, well,
it's not because I want it to go to the moon and I have this idea that it's
gonna go and go and go. I've,
I've gotta have a reason to work for whatever I'm trading to target, uh,
specifically cuz I think that traders spend a lot of time learning strategies
and everything else, but they never really learn the,
the art of exiting the trade.
Yeah. Yeah. That it is a big ass, isn't it? It is. It is a big art. Yeah. Now,
um, so you, you said you created an EA based on one of your strategies.
Was there a particular reason you chose that strategy to, to automate?
Yep. It's, uh, it's, it's based on some candles and one moving average.
It is the most simple thing ever. Um, it, it, it, the,
the the, the signal comes up quite frequently.
Um, it, it,
I I only use it on as a continuation pattern as opposed to, I mean,
some of the most major tops and bottoms, the signal comes in.
But I'm not really a a a,
I'm not looking to sell into tops and buy into bottom. So I, I think, you know,
we've got 80% of retail market losing money.
And I think good part of that is that traders are trying to trade clever,
they're trying to be clever on a market,
which is quite obviously sometimes in a downward trend or an upward trend.
And yet they wanna pick tops and bottoms.
They probably started off trading trend, um,
and then decided to go for tops and bottoms. And I'm, I'm a trend trader. I, I,
I really like trend, even if it's a, it's,
i I want it really across the timeframe. So I like the daily,
daily timeframe being up, the four hour being up,
and then I'm happy to be taking my trades off the hour timeframe. Um,
I go go down to smaller timeframes to get in a more eloquent entry. Uh,
but, um, and just look for the detail below the timeframe. But, um,
it's really four hour alleys when I'm entering the trades. Um.
And so, so this, with that particular strategy where you've automated it,
when you automated it,
did you go back and test it across historical time just and see
that even though you'd only started trading it, maybe what, I don't know how,
how many years you'd traded it for,
but was it still performing before you manually traded it?
Yeah, yeah, it was. I mean I, I,
I started trading it back in 2006 and, but the thing is,
I was trading it and for, for some reason, I I,
in those days I thought it I should look for a fixed point target.
Um, so that's one, that's one thing I was doing. I was looking, so it,
it became hard. I, and it, it worked at that time.
It seems to work really well for the euro on a 15 minute chart. And it,
it was given some really nice, it, it's like,
can't remember a 20 pip, 20 pip stop, 40 pip target, something like somewhere,
somewhere in that line. Um, how I was trading it at the time.
And it looked really, really good. Um, well,
and it worked for a while. It worked for a,
a decent while when the markets were in a certain, well,
the markets were quite volatile, but it worked pretty well on that basis.
However, the, uh,
the average true range of the euro came down to 45 pips,
and there's me looking for 40 pips and 45 pip full day, you know,
and you've still gotta get in the trade and out of the trade and, and it,
it wasn't really working, it even rolling over to the next day or so,
the market's just too choppy. Um, and it just got so consolidated it,
the mar it, it killed it. Mm-hmm. So I left it alone, but then I, I,
I looked at it cuz the, the pattern is, it is just, it is brilliant.
A little three bar pattern. It is just so silly, uh, that it work that it works,
but it works.
And I looked at it again and I thought there must be a different way of,
you know, deciding on when to trade it and also deciding on what,
uh, what sort of target is, is, is suitable. And it,
I I literally, once I cracked that, so I, I had a, a, a little formula,
which gives me the, the target and, and I back tested it, back tested it,
I went years, years back, I went five years back. Um, uh,
it actually physically, uh, testing it so you know, it, it was a case of,
um, yeah, it works . And, and I'd seen the figures and,
and there was really horrible times during those five years and there was really
good times. And as I said, it comes back to the mindset in terms of we,
we are pr we don't program ourselves to understand what really could go on.
We could, we, someone would tell us, so it's got a 60% win win rate,
but over time it can have a 60% win rate,
but at any given time it may have a 90% losing weight rate in that little
picture. Yeah. And crikey, that's squeaky bum time in, in real terms.
And people give up with it. And um, we, we did, it was, uh,
2019, uh, 1921, we,
I can remember the date in 2021. Not that old 2021.
It had a, a poor old year. It sort of started off okay in January,
March in April it was okay.
And then it just really went downward and it just,
it just really had sort of like three or four months of really des desire to me,
you know, sort of 6%, 8% down in a month on,
on some of the currencies. You just for, I know it's not very much ,
but it was in, in, in a sense of expectation,
I guess it just hit a bad patch be because you start, you know, get 14% down,
you know, the next thing is you're 20% down or 30% down,
you just think that's wrong, .
But then all of a sudden it started coming back again. I mean,
it ended of the year 20% up overall. Um, right. But, but it had a dip.
Well, if you'd taken from January right the way through,
I was actually measuring initially from March, but if you, uh,
to get the 30% down, but the, the, the, the earlier stages,
the earlier months in there were pretty decent. Um,
so it was running better. But it, it, it's with trading,
uh, a strategy, people are very short-termism, uh, have a very short,
um, timeframe in which they'll give it any chance. And, uh,
I think you can use mechanical methods to back test and there's a lot of great
systems out there, which I'm sure would give you certain things.
But actually seeing it, I, I know it takes a lot of time and that's why I, yeah,
don't get a lot of sleep these days. But, um, if I,
if I get into a strategy all of a sudden I want to just sit there and do it and
just look at where this is going and let it, well come on.
It must have a losing run in a moment. And, um, I mean I can show you on a,
on an Excel show, uh, I've got it all done on Excel spreadsheet,
everything calculated out. I look at sort of, uh,
ratios of win loss to see what it's achieving on a regular basis.
And you could outperform it to a degree. And I, I, I've played, um,
take it or leave it with the, the client, the,
the guys that trade it with me in terms of, I,
I've got loads of pictures of the setup. Ah, okay.
So when you take this one or leave it, and they, you know, they,
they all have a guess of whether they'll take or leave it.
And probably 70% of the time they're wrong. You know,
it would either gone on to win or, or lose.
And yet if you sit there and you think, wow, I could out trade this easy,
but there are times that Canadian dollar, I've switched it off at the moment.
It's one of the pairs that I've trading with it,
I've just switched it off anyway, but I, uh,
I will manually trade the can Canadian dollar sometimes when I see the,
the sit signal coming up on it. Um,
but I ha I have, you know, really strict timeframes when I, again,
eight till 10 o'clock. If it's not set up and running by 10 o'clock,
I'm not gonna get into it in the morning. Uh, it don't care what it does. Um,
and again, it it's,
it's just got these peak periods when it really works the best.
And the only way you,
you really find out about that is testing it and going back and looking at it
and getting the feel for it and having confidence then, and you just leave it.
Um, something a lot of treaters can't do,
but you've got to just leave it because, and so, so.
When you were trading it manually, were you just trading it in those time,
that time period and that's why you came up with that time period?
I, I, I only traded it manually after I tested the theory. So then I,
I started switching on manual then I,
then I found a broker that was absolutely great in terms of, it had like, uh,
like, like an mt four platform and, but they had the benefits of, uh, you could,
you could ti you probably get this for NT in terms of a timer on it.
So if it didn't tri,
you could have it all set up that if it didn't tr trigger in the next hour,
it just canceled the order. Um, I'm sure there's must be something for T4 out.
There. I think there's, I think you can set an expiration on the pinning orders.
Yeah. For.
For, there's normally a day. It's normally a day or something like that,
I think. I don't think it's time wise, which is no good. No, no. Good for me.
No. Maybe it, maybe it.
You've got me I'll to have another looking at.
Look as well.
I know, I, I don't set them up cuz I, because that's automatic.
I built that into the, the EA I said I built it. I didn't,
I paid for some guides. I built the EA for me. Uh, so that, that was all,
uh, done. And I, I, to be fair, um,
I get the pings and I don't even look at the chart. I don't, I don't look at it.
Cause I just think you start looking at it and you'll wanna,
I know better , you.
Know, think man. So, so we, so if I've got this right,
so you head a manual pattern and a sort of concept. Yep.
But then you use the bot to find out how to potentially get a better
exit for the strategy.
No, I did that. I did. I I did that manually. I looked manually as well.
Everything was manual. I, I looked at, um,
how far the price moved after the, the, the signal came and it,
it triggered, I looked at the, the potential for of movement.
I was quite harsh on it because, um, it,
I'm trading my money at the end of the day on this strategy. I don't want, uh,
uh,
to go where it moves 60 pips and then all of a sudden you get all this lovely
peak area that's given you, um, like the,
the optimum is three times or something like this.
And reality is it's 1.2, , 1.3, you know,
it's is you, yeah. You've got to be completely honest. Um,
it's weird back testing when you,
when you do it for these sort of things because you want 'em to work.
You start doing, you, you get involved in it and I, I,
I guess this is one of the mi mindset things is, but you, you,
you wanna sit there and get it to work. I've sat down. I, I used to have,
I do been mentoring in, in indoors and they'd come and see me in and sit down.
I mean the great thing about Zoom now,
I can mentor God knows how many people one go in a trading room. Yeah. Um,
it's damn site cheaper for them and it's easier for me,
but I can show them everything. But this, this particular guy,
he wanted to go back and he, it is an 8 21 crossover and it was, it's like he,
he's just found gold and it,
it worked for about 20 trades and he probably only,
he probably had a 70% win rate somewhere in that region.
And then the market completely turned and it just get went flat basically.
And he was getting all these crossovers backwards falls back, falls,
he's losing. It would've been losing the fortune if he'd been trading it. And I,
and then he said, well I'll do this, I'll do that. And I said,
but you can't go back and, and change every,
the thing with testing is you've gotta be completely honest with yourself and
you can't go back and just say, well I've done that because of this.
You've gotta have it. So I,
I think an EA is a real tester of any strategy because you're then leaving it to
run. You can't fiddle with it. It's just run. Um, you can,
you can adjust it over time to improve on it because the, I I,
I'm monitoring the results and monitoring what it could have done all,
all of the time to see if the, if, if I could get more out of it.
The volatility is really picking up that much. The only thing is the,
the stop would be picking up as well. So more volatility,
it may be instead of having a stop of about 20 points or uh,
20 pips or 30 pips, it may be 50 pips or 60 pips.
So in ratio terms, you, you might not get a lot more out of it. Right. Yeah.
But for the point lovers out there, they're,
they're love it or pip lovers cuz they'll say, you know,
just made 80 pips on a trade. Yeah.
Yeah. Risk.
I I risked 70 to get it, but I got.
80. Yeah. Now, now I, I read in your bio that you were sort of like you, the,
the stat god around, you know, you've got stats on I.
Did not say God.
. Well no, maybe you didn't say that. I just said that. But, um, you've,
you've done a lot of work on working out the stats behind certain signals
happening and the success rate of those. Yeah. Can you,
are you able to share some of the insights you've found?
Um, I, I mean the, the stats, I'll, I'll,
I'll certainly share some pivot stats because I think they're, they're,
they're probably, um, if,
if you using pivot points and if you never put them on a chart,
just go and put a basic floor pivot on your chart, your favorite chart.
Now if you're looking on the data, I'll just give you some, you can set them up.
They that are monthly, weekly, daily, or even down to four hours.
Some people trade or hourly cause they're mad. But, um, I, I personally, I,
I always have a monthly, uh, a weekly, um, and a daily pivot,
pivot showing somewhere on my charts.
I've got one chart showing always the pivot on there, um,
aside of when I'm back testing my other strategy,
in which case I have nothing on there apart from a 34 moving average and price.
Um, so it's, it's all done with, that's the way I do that. But with, uh, pivots,
um, they're absolutely excellent. If you look at some stats around it,
then it's like a bell curve. Effectively, if you look down from, uh, I'm,
I'm only going from R three to s3, a lot of, uh, pivots now will give you, uh,
fours and fives. Some of them even sixes.
I'm not worried about those because the probability of, uh,
going beyond an R three is round about 5% below s3
round about 5%. So, uh, and that,
that's pretty similar across the timeframes from daily upwards.
It's different for a four hour pivot. Cause the extra volatility, it, it will,
it, it changes the flow a little bit there. But for dailies weekly, monthly, uh,
monthly, uh, pivots, um, you've got a, uh,
the moment with the Euro dollar for example,
you've got a 75% chance of the daily, weekly, or monthly pivot being hit.
So it's got a high, you know, pretty high probability of being hit. Um,
that doesn't mean say it'll stop there, but it, it, it's got a, so you,
you can use them as targets in that way. Um, the way pivots move,
then you've got the R one in the S one,
then the probabilities of the R one or the S one around about, um,
actually I'm saying round about the, the LA last year on,
on a rolling year here, um, the 40 is a 40% chance it'll hit the R one.
Uh, or this is on the euro 47%, it'll hit the S one.
But the euro was largely downward trend. So it's no surprise last year it was,
I mean it peaked up, but it was, it was going downward.
So there's slightly better chance of it running down to S one. So you know,
it's gonna hit either the R one or the S one 75% of the time. Uh,
sorry, Yeah. 75, uh,
75% of the time it was gonna hit either way. It's the same percentage.
That's right. Reason I looked at, um, it's,
it's the same percentage of RIC just hits the pivot itself. Uh,
so it's gonna hit the R one or the S one each day.
So if it's hit the daily pivot, then you start getting,
I've got a target here of either the R one or the S one. So you can work on,
and you just play with TRA trend then. So a lot of my,
my strategies have built on that sim very simple, uh,
realization where what's gonna be hit here.
If you look up to the R two in the S two, um, then,
then the probability goes down to 15% and 17 cent. So, um, the,
the R two s and S two s have less chance of being hit. However, ,
if the pivot isn't,
the main pivot isn't hit and price touches the R one pulls back and goes through
the R one, then you've got a 65% chance of it hitting the R two. So it's, it is,
it, it it's, it's easier shown on the chart then it is discussing here. Cuz I,
if I was you, I'd probably go la la la Bye now . But it's, it,
it's actually seeing it.
Makes sense. It makes sense though.
It makes a lot more sense. I dunno how many people use pivots, but I, as I say,
I'd strongly put 'em on there because all of a sudden you think, oh,
that's why it stopped there.
. Yeah. Well the funny thing is, it used to be,
when I first started doing this stuff and interviewing people,
people were talking about pivots quite a bit and now never hear anyone talk
about pivots. So, uh, it's,
it's obviously something's dropped out of favor for whatever reason. But I mean,
I, I mean I haven't looked at them for, for years. Why is,
did you stumble on, on them as your sort of core, you know, strategy? Well.
Do you know, when I, when I first found them,
I didn't really like them that much because I was such a fi archi fan. Yeah.
As a, i I mean my, my time of trading, sorry,
it's all going back a step here in terms of, I've,
I've spent so many years on looking for the holy grail. Um,
like any trader that's been out there for a while,
some people would just give up very quickly.
But you're looking for that thing that's gonna give you that bigger edge and you
realize you come to the end,
end game here is it doesn't need to give you a massive edge.
It just needs to give you a relatively consistent edge and it needs to give you
an edge where you can make more money. You're gonna lose. That's all you need.
simple as that. But we go out there because we want these 80,
90% strategies, uh, a hundred percent str you know, ideally, I mean,
who would love, um, to have such a strategy? So you, you,
you go spend, I I spent time running through, um, I, I'd start,
I forgot to mention I used to write a newsletter for a, a,
a one of these trading education companies and we used to write our own
newsletter. That's so much information I'd gathered. And one thing I did,
I started doing some analysis on different indicators and they're,
what they are, what the, how they work, uh, cause again, we,
we tend to overlook what we're using.
And most of these indicators are completely lagging. Um,
the thing with pivots is they, they worked on a lag lag basis,
but they give you a forward, a forward shot of what might happen in the day.
Yeah. Whereas most things, they're, they're only reacting to price.
That's ha Yeah. Okay. Yeah. Arguably pivots have in the calculation,
but then they stay still all day. A moving average ironically moves.
Well it's not ironic at all. It does move . Yes. Um, so it, it's mo it's,
it's moving. So, um, yeah, I tested,
I looked at so many different things. I looked at, um,
I got introduced to this guy. He was so, so interesting. And he,
he did this sort of system, uh, which he called Matrix,
sort of old market matrix. And, uh, which, um,
yeah know we looked and I just thought, Alice, this is brilliant. And it it,
it was this sort of like a timing tool where the markets were gonna turn and
Whil Wil Wil Wilder, his name,
I had the chat from R sife. He, um,
he had written a book or he hadn't written it, it wasn't his work actually,
but he put his name to it to, to, because it wrote Rose, uh,
generated a lot of money. Um, but he put his name to this extract,
this measurement of Delta, which is when, when there's the,
a map of when price action might turn and it,
you get these little windows of when it might turn. And so you,
you would forever be looking at that Lynn. We, we, we put it together with um,
Elliot wives and Fib Archi and the,
it gave you a full matrix of, and looked at instead of just looking at, uh,
price levels and, and highs and lows and things, we looked at time as well.
Anyway,
that was a long two years that never really came off too much because I
realized, um, the guy that was, you know, was, was working with, I mean he, um,
he was just a blinking good trader.
And the only reason he was a good trader is cause he read price. Um,
however it was, yeah. He would look at price and he, he read price.
He wasn't using all this market matrix stuff.
He was actually just reading the price.
Cuz he'd always have an excuse of why he is just done this and why he is done
that. And all he is doing is reading the price. And, uh, uh, you know, it, it,
it's one the, this memorial stories just learn how to read price.
You can, I,
I can show you I I i how to trade literally without
anything else but price. And I do this at any time.
I didn't care if people can come into my room free of charge for a day or two
and I'll show them how to reprice. And you,
you can see how you could make money just by reading price action, uh,
put pivots on them price.
And it's an absolute dream for me because I can give you the, i,
I know the stats behind the pivots and I can see the price action and all of a
sudden I've got an edge in that market. Mm-hmm.
And I know that edge is gonna work. Yeah.
A good percentage of the time and a good percentage may be 60, 65%.
Well that's good enough for me. Um.
I like that. I should actually bring up the pivots again,
I think myself and just have a look at where they are in conjunction to what I'm
doing. Cuz it's, it's definitely gives you an edge, right?
If you know that that's a point that you could, could take profit or,
and it's not gonna move if.
An inter Yeah. An interesting thing is not a lot of people do this.
I say an interesting is for me, uh, cuz I, I'm a bit stacked driven,
um, prob probably cuz my mindset is, uh, risk. Uh, i, I don't like risk.
So if I can work out the stats, I say don't like risk, I like risk,
but the right sort of risk. So I, I want the, I want it to be on my favor. So I,
I just work out the stats. I,
I've shown people it before who are pretty good traders.
I know they're pretty good traders and say,
why don't you put the pivot on there and, uh, see what it is.
And I've then given the stats, he said, well,
I didn't know that that would've made a difference. And you know, it's sort of,
you, you don't wanna stifle your trading.
And a bit of common sense is needed with them in a sense.
But common sense is only learned in, in the case of trading, you know,
but it will come, um, you'll, you'll just pick it up. Oh, that's going to,
for example, uh, the chance is that if a,
if an R two or an S two only have a 20%, let's just say 20% chance being hit,
why would you ever target them? However,
if it hasn't hit the pivot and it's hit run up to the R one pulled back and
pushing,
pushing back the next time it's got a 65% chance hit being hit purely
because the, the price, you know, if you can imagine it,
the price must be in a trend, you know, in a quite strong one. Yeah.
It's not gotten anywhere near it's pivot. It's ti it's time. So, okay,
I'll play it up to the R two.
The other thing with pivots you've gotta be careful with,
they do get very pinched. I mean, today's pivots were relatively,
yesterday were particularly pinched. Uh, today's were relatively pinched. Um,
so, uh, you, you then you've got to, again, I suppose there's.
Not a lot of room.
Comment against, bit of sense has gotta be taken to, okay. The r twos,
the twos may be hit today. Yeah. Um, and, and some days that, you know,
you get a big movement like Friday and then you, you get the pivot the next day,
uh, Monday, and they're sort of a country mile away. And then you gotta,
you gotta look at the midpoints. Uh, when the,
when we had all that volatility between 2008, uh,
seven and eight nine when the, when the banks were all crashing, um, I,
I used to, uh, use midpoints on there as well. Um, because it,
it wouldn't get to, it just don't run outta legs,
even from volatile how the markets were there.
And it just run outta legs before it gets to some of the targets.
So I used the midpoints.
Interesting. But.
Uh, okay. I unlocked them on the head lately.
Right. Well, let's, let's, um, dive into some more of these questions. So what,
what about if you were gonna recommend a,
a step-by-step approach for somebody coming you into trading, what would it be?
Um, firstly, learn how to read price without anything else on your charts.
Just learn how to read price if you're gonna do that.
And then it sort of really build things up. Stay with trends.
Always just look at trends. Don't, you don't need to be the top and bottom man.
Is it j was it Jesse Livermore? He, he spent,
it's the confessions of a stock operator. Mm-hmm. You read his book,
he suddenly sussed out that trying to get tops and bottoms,
which he was particularly good at doing at times, but not, not regularly enough.
He went from boom to bust. Uh, so many times he, he, and so it's,
it, you know, it, it's not the place you,
the the chunk in the middle is just as good.
If you can get some idea of way theory, basic way 3, 1, 2, 3,
you can count three. You can sort of work out where the third wave's,
the biggest wave and yeah. So if you're in a trend and it's sort of,
you're in this sort of third wave, it's, it's got a bit more to go po possibly,
um, statistically of course. Um,
so, uh, yeah, uh, make sure you're doing that. I mean,
make sure you've got an account that's funded and there's, there's,
there's little uh, point actually,
apart from learning how to use the brokerage you're using,
actually using paper trading.
I know a lot of people say you've gotta paper trade first.
You'll only ever be guessing with, um,
brokers don't care about their, their paper trading. Uh,
guys in terms of if there's a bit of slippage,
they're not gonna slip your trade. Uh,
cuz it's paper at the end of the paper money, it's not gonna get slid.
It's very unlikely to get slipped unless they're using the, the, the feed, um,
from the live markets and whatever else and filling you those. So you, you're,
you're getting like a force security and you haven't got the mindset,
you haven't got the, the fear factor. Uh,
a good guy in our train room at the moment, he's, um, actually mentoring him,
but because he's a good IT guy and he's saying media guy and he's doing
some of my media stuff for me in, in, in return. But he, um, he's, he's,
he went over from doing a, um, he did a challenge, which on, um,
was it f om mo or whatever it is that I know what it is, it is, uh,
fear of missing out F tmo. It's not that one F tmo. Yeah.
He did that challenge and he did pretty well on it and it's all paper.
Um, he did blow it. The next after he, he, he break, he passed the challenge,
he then carried on trading and blew it on the next day. Um,
hope he never listens to this. Just confessed. I just confessed for him.
He blew it on the next day and he broke the rules. Um, but, um, then,
then he went from trading like this. He had been trading in the past,
he'd been a crypto trader, so he is gone the other way. , um,
he's seen the light. Um, anyway, he um, he's now move.
He's, he is,
he's got a sizable account and he's gone to cash and now he's noticing
the difference to trading between paper and cash in how significant it is,
particularly with letting the trades run and walking away from the charts cuz he
almost can't do it. Um,
so if you start off in a good practice and actual running with real
money, but don't risk any, the, the, again, learn, learn risk,
understand risk. Sorry, you, you're getting me to start real, really ease up.
Probably not in the right order. Must understand risk.
Don't risk any more than 1% account. Don't care how big the account is.
If if it doesn't fit in and the,
and the trade needs 2% or 3% to trade it. If you're starting off,
leave it. You can't take that trade. It's too rich for you son. Oh, you know?
Yeah. Be be realistic.
Find another market every.
Yeah. Find another market, find another opportunity. Just wait, pick,
pick your fight with where you, if it looks ugly, it's ugly, um,
leave it alone. Uh, find something that, well, that looks nice. And uh, there's,
I I look all the major currencies and the cross pairs of those majors. So, and,
and that's my weld because I can, I use a, a broker that's got very, very,
uh, tight spreads for me. Um, makes rates almost.
And I, I, I can get ver I I'm straight into the market. Um,
it's a direct access, genuine direct access market, uh,
broker I would say, as opposed to a lot of these, such as match you and stuff,
it's just done and it's, it's there and the deep liquidity.
So, um, yeah,
just ensure that, um, you know,
your ma as I say, managing risk one, 1% is,
is absolute tops. And it may be when you're starting off with cash, you go,
we're half percent. There's nothing wrong with starting off and,
and then gradually building on it. But if,
if you can just start off with one and you'll find that, uh,
the power of compounding and just go use a little f formula, indicate use the,
um, there's plenty of little, um, um.
Tools and stuff. Tools, tools, tools.
Yeah. To make sure you, you've got the right size, position, et cetera on there.
You may find that you're slightly under slightly if you don't always go on
slightly under rather than slightly over because otherwise you're get in the
habit going too big. Um, and just, yeah, stick with, stick with it. Look,
look at your risk. Risk is absolutely all you're managing.
And if you can manage your risk,
then the bottom line starts looking after itself.
You understand what you're looking at.
Now. Now one of the things.
You mentioned there to hang up on, um,
ratios of like looking for only two to one, I used to, um,
and three to one and four to one. Um,
you'll soon find out as a beginner it's harder to exit the trade than it is to
get in, as I said earlier, um,
deciding on where your targets are is part of what you've gotta be learning, um,
at an early stage. And again, reading markets,
maybe looking for previous highs and lows and things like this may be an easy,
easy way to address that. But you,
you've gotta work out a way of how you're gonna exit that market.
Yeah. Cause so,
so you mentioned at the start there like reading price and I think that's sort
of come across as, you know, this other guy who just read, you know,
he actually reads price. He doesn't have this , you know,
he doesn't use all these other things he's teaching, but he reads the price.
What, what, what sort of, if you had to say three things,
here are three things you can go away and study over the next month to
understand price better, what would they be?
Well, it, it's start it, you, you,
you can start off with the, the price action itself. I use candlesticks. Um,
so you, but you, uh, it,
it's just easier to see what the prices are doing.
But individual candles will give you a clue. Now, if you're a nervous ninnie,
you can always change to hike and a hike and Ashe candles and they're brilliant.
Um, you might wanna look at those cuz they'll keep you in trends longer than you
ever thought you could keep into a trend, um, because they,
they average the price over a period. But, um,
if it is absolutely, uh, an earlier start, I would just start off looking,
looking for lower highs, lower lows, higher lows and higher highs.
And that will give you a picture of trend,
but look from higher timeframes down to the lower timeframes. So you always,
you, you wanna be with, with the trend. And if you're looking off a,
let's say you're trading off an hourly timeframe,
quite often it's good to come down to the lower timeframe,
15 minute timeframe for example, or even five. But 15 is,
is a brilliant timeframe to come down to.
And you might find even easier ways to get into something that
you're looking at in the higher timeframes.
It might be giving you something that you think, oh, this looks okay.
You go down a timeframe, you say, oh, hang on a minute. No,
not trading that yet. It's, it's,
it's quite a bearish little signal with the candles.
It just isn't looking right. But um, yeah, so it's,
I think there's three things.
Yeah, there's three things now. Um, what about,
you've had a lot of students come through,
I'm sure you've seen all sorts of different mindset issues pop up with students.
What, what are your, what are your sort of hacks, tips,
tricks that you share to get people on the right track?
Well, I think the easiest thing is we've got so much technology these days and
as I dwell back to the good, the,
they weren't necessarily good old days in terms of technology. Uh,
but these days we've got alerts,
we've got all the orders under the sun that you can want to,
that would take profits. You can buy, buy, stop,
sell stops every other order that you can particularly buy limit sell limits.
You've got plenty of tools there to place the trade or
place the sit, the, the, uh, setup for the trade. You can put your,
your target in. You can put every part of the trade in there, walk away, go,
go do something, go do the garden, walk the dog,
do something completely different.
Don't look at that computer until you hear a ping somewhere that it's close to
trade. Um, that's the best mindset because then you won't fiddle it.
Because even the, even I look at charts sometimes and I come back and it's,
and I can find an excuse to exit anything. Um, so it, yeah,
after years and years of trading, I, I, I still, but I, I literally, I'm,
I'm trading for, you know,
I wanna see how far it goes and what I actually get out of it because I can't
report it to the guys if I hadn't left it run. So it's great. So it's,
it is like having a another mentor there that, uh, I,
I have to confess to him when I'm closing it, buying it or whatever I'm doing,
yeah. It all gets reported to them. So it's like having a, a third party,
maybe that's, that's part of it is that you,
you speak that you have someone that you speak to and say,
this is what I've done. Uh, this traded me, this is my target. Um,
and then tell 'em what you actually come out at and how it, how,
how it turned up and when, when you got to report back to someone may, uh, it,
it may just make you stay in things longer,
but if you're not look there in the first place looking at it,
you ain't gonna be fiddling with it. Cuz you can't. Well,
you can if you go on your phone, but don't take your phone.
. Yes, exactly. Exactly. Okay. So really the, the, the,
the long and the short of it is just do do your analysis,
make your decision and Yep.
Somehow get off all the technology that can give you access to that information,
um, of where the price is currently at. Well.
We just get on with things. Yeah, I mean get on with ba I mean I, I I,
I literally, when I, when I get into a trade in the trade room,
the worst thing is,
and I've banned anyone talking about if the trade's doing good cuz that it was
almost like a death kill for it. Yeah. If someone says, oh, the, uh,
what were we trading the other day? Was it,
it was the Aussie Aussie cad we traded on Monday and someone said,
that's going well. And I said, you, you just can't do that because, um,
it might, yeah, you, it'll probably turn down.
It turned almost like straight away as they said it,
it started moving back up again. It, it, it went down to wind, but it,
it was just that sort of, you don't wanna be looking at it, you, because, um,
people want an excuse to exit or, or locking money,
particularly in the earlier stages. It's that just,
it's particularly if they've had a few losses, if they've,
if they've been fortunate and had a number of wins and it's sort of done and
they're, they, they've been winging it or whatever they've done,
they'll then get over bullshit and think, well,
I'll let everything run and it'll go for miles. Uh,
but just it inevitably happens that people just
look for a reason to exit the trade as opposed to trade, you know,
using the stats that, you know, if, if I know I've got an R one,
it's above previous highs. Okay. I don't hit the,
I don't ever take an R one or an S one and as an absolute target,
I allow a few pips or three or four pips just so that, uh,
the spread and everything else is there because it might hit the pivot and your
spread hasn't quite caught it. Yeah, you trading some of the outlandish, uh,
pairs, but, uh, you just, just leave it,
just walk away, uh, do something else. Back test, look at different charts, um,
anything.
Um, ironically it's the whole purpose trading, isn't it, to get the,
get the time back. So if you, if you, if that's the time that you've got back,
hey, look, we're gonna dive into the, uh,
quickfire round here and then wrap this baby up. Uh,
and we'll jump into a chart afterwards and get to see what you, what you know.
Um,
so how long did it take you to go from newbie to consistently profitable in four
x trading?
In four x trading? Um, because I had to,
the experience beforehand, it was sort of like just an, an add-on, but, um,
I had probably periods when I was doing particularly well then particularly, uh,
then area periods and I, I wasn't doing so well for, you know, so it was,
it, it took a long time to realize it's just, it's a long-term game, so I could,
because I was measuring myself on too short a period, uh,
like months as opposed weeks and months. Um, and then I,
I realized that you should really be looking at your result over a year and
yeah, what you're doing over a year. So I,
I probably hammered myself in terms of, uh,
early stages probably took about three years to really get into a rhythm of
not not being overly worried and hung up about
a month's trading. Um, you know, we're gonna have losing months, you know,
happens. You,
you almost don't wanna admit to the fact that you have o losing months because
you're a professional trader, but it happens. Um, you know, that's trading. Um,
so yeah, probably about three years of actually,
but I had pigs and troughs all the way through it, so it's sort of, uh,
I never gave back more than I had and, and I made money over the three years,
but it, it wasn't, uh, wasn't as consistent.
What's your favorite entry set up?
Sorry.
Your favorite entry setup?
Um, I'd say, you know, a flag with pivots involved, as simple as that.
Um, and w when I show you on the, the pivots in the moment, I,
I'll just show you some of the very simple processes I just follow and it,
but it is, it's something I, I do like flags weirdly, weirdly enough. They,
they seem to work pretty well. Um, and yeah, if I've got,
if I've got a pivot target for it, that would be it. Otherwise my little,
obviously the automated trade, I call it AB three is a three candle stick, um,
signal, um, with, with some know-how that goes through it, some trend. Um,
and that's it. So I've got two there now. Sorry.
That's all right. And what, what, uh,
what about the method you use to exit or manage trades?
That's as on the, uh, autotrade, it's done on a ratio. Um,
otherwise it'll probably be Pivot.
So if it's a date where even on a weekly basis, I'll be looking at pivots,
so often, uh, of the weekly or monthly I'll have a target and that's,
that's what it'll be. Um,
prior highs and prior lows often make a bit of sense, but not always. I,
I can look at the order book to see what, what's, um, what lies above.
So if there's a load of buy orders above there, I'll just run it out.
Uh, what's your preferred, uh, uh, recommended trading book or resource?
Um, you know, I, I saw you give me this thing, read this old book.
It's, it's, uh, it's called, um, the Diary of a Professional Commodity Trader.
Okay. Uh, Peter Brent, um, okay. For a professional trader, you,
you probably won't read it too much. And he says that in the very few pages,
he said, what you reading this for? But for a, um, someone,
someone told me about the book and, you know, I read it and he,
he's the most more sky going and he made money year on year on year
on year trading commodities. But he was,
he was using the mo What I liked about he, he does what I'm doing, ,
you know, he's using straightforward old patterns and you know,
these things that these, uh, so-called gurus on the,
they say don't work anymore, load of rubbish. He uses those,
he uses cups and handles. And I,
I laugh when I see someone talk about Cup and handle head shoulders and things
like this, but yeah, he, that's what he was trading with.
And he sh he goes through his diary of trades that he took,
and when you see house, he's just so honest and I,
I just love his honesty in the book and he's, you know, he's,
he laughs at these people and I've always done it,
I've always found it strange that people need to go and prove themselves and
take 10 grand and make it 50 grand or a hundred grand or whatever else.
It's good, don't get me wrong.
But they're al they're most likely breaking rules mostly through that.
So for the Joe Public, they, they think that's a, that's,
that's an achievable thing to do every year. So I've got my 10 grand,
I'm gonna make 50 grand a year this, this year.
And of course they end up with two grand, you know, so, um, yeah,
net two Grand .
Okay. What, what's your preferred broker and trading platform?
I use Lmax, uh, which for a broker, cuz it's straight for,
I mean it's literally, um, it's a professional account. Um,
they, they don't like you really trading less than 10 k, um, through them.
So they're, they're sort of got, you could have a good size for it. It's the,
the platform is quite ugly and old and clunky. Um,
I tend to use MT four as well as, but I, I, you know, I like MT four.
I find it really easy to, uh, do things on. Quite often they're,
they're LM Max's main platform. I sort of like it, but you can't hedge on it.
You, you, you literally over in or out of a trade. If you close,
it's quite handy if you just wanna close part positions and things,
you can just put loaded folders in there and it'll close it before you partly,
but, um, it's, it's a bit antico antiquated,
but it's really for a professional trade,
it's just trading one direction probably, um, as, as I see it. And,
but you can put decent size through a very big size through them if you want and
it's just wished away and very, very cheap.
Hey folks, ever wonder what broker I use? Well, I use HaCo Trade.
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Awesome. Now, uh, last question here.
If you could leave our listeners with one piece of advice, what would it be?
Stress, um, read price, learn to read price,
and stay on the trend.
Okay. So go back and listen to what, uh,
what Kim said before around reading Price before we wrap up.
What's the best way for traders to get a hold of you?
Um, through, um, my website, um, the pivot trader.com. Um,
there's details on there. I do have a telegram. Um,
I've now got Discord as well. I've got everything now,
but I think by looks the same, but I've got a telegram, a free telegram, uh,
account, but you can, uh, get the details off the website anyway to contact us.
It's all on there on the pivot trader.com.
Brilliant. Well look a big thank you to Kim for sharing with us today.
Everything we've discussed here are.
Uh, in the show notes on trading net.com.
Just search for Kim k y m in the search box and until next time,
I wish all my listeners trading happiness and success. Alright folks,
hope you enjoyed that episode with Kim Watson.
Now do remember we shot a video afterwards, so if you are on,
not on the YouTube channel or even if you are, jump over there, check it out.
He breaks down pivot points and the probabilities of hitting each point.
So please go and check this out. This is well worth your time.
Other things going on here at Trading Out,
we've got the Fidel Crest 50 K challenge.
If you do wanna take part in being on the trading net livestream and go through
this whole challenge process, then there's an opportunity for you.
There's an en entry form link below the video or in the podcast description.
Go and check it out. I'd love to see you on here on Trading That in the future.
Alright folks, thanks for watching or listening wherever you are,
and we'll see you in the next episode soon.