The DAX Day Traders Trading Plan

We primarily use the M5 chart for trade setups then if required we switch down to the M1. A second install of MT4 is used to provide the higher time frame context. All charts have the Price Action Grid overlaid.

Apply the 3 R’s: Routine; Rules and Repetition.

To support this it is recommended to set an alarm every hour to remind you to read your trading plan. Over time this will wire the brain and program the mind to produce consistent behavior.

Tools

Setup

Preparation

  • Review the previous day’s trade setups and results.
  • Identify potential reversal zones where REVFIBs are likely to appear for the session.
  • Identify any potential higher time frame hourly/daily FIBCONs that may come into play during the session.
  • Take time to quiet and focus the mind.
  • Visualize yourself identifying and trading great setups that result in multiple R winners!
  • Watch the Trading Plan Video.
  • Read Trading Axioms and Affirmations.
  • Make sure to Trade With The Energy.

Trading Session

  • Ensure there are no distractions, complete concentration is required.
  • Ensure intraday Key Zones are up to date focussing on the most RECENT SH/SLs (Use wicks)
  • Mark up the A-B-C chart pattern in real-time.
  • Only trade setups that conform to the MAB or FIBCON chart patterns when there is a clear trend underway otherwise use Range Rules.
  • Set alerts at potential reversal zones – REVFIBs!
  • Display the Example Setups as a clear reminder of quality setups.
  • Every few hours update each time frame to show whether it’s in an Up-Trend, Down-Trend, or Range (markup the swing highs/lows).
  • When using the M1 chart to enter a trade switch back to the M5 regularly to maintain perspective.
'Be The Bear'

NEVER chase price, only EVER enter on a Pullback!!

Wait patiently for a setup to come to you, eventually one will.

NEVER react to Price Action – ALWAYS anticipate.

If the Price Action is not clear then WAIT until it is.

Watch, Wait, Anticipate…

Risk Management

  • Only consider 2R setups or better.
  • Risk 1% per trade.

Trade Entry Considerations

  • What is the higher time frame context, does it support the trade?
  • Is there a clear impulsive A-B move that’s produced a Higher-High or Lower-Low in the context of the time frame?
  • Is there good confluence at point C? (Golden Zone, MAB, Grid structure) – Look Left!
  • Have I waited for price to reach the optimum entry level or am I entering too early due to “Fear Of Missing Out” (FOMO)?
  • Would a professional trader wait patiently for this setup?
  • Is there an important news announcement due in the next 30 minutes?
  • Is there an Outer-Inner FIBCON in play?
  • Consider using a limit order to avoid FOMO.
  • Am I blinded to a setup in the opposite direction?

Final Checklist before entering a trade:

  • Have I anticipated this or am I reacting?
  • Can I see the A-B-C with excellent role-reversal?
  • Do I have great structure?
  • Do I have great confluence?
  • Do I have great context?

Assuming we have satisfied the questions above, ask:

  • Does this trade look good?
  • Does this trade feel good?
  • Would I take this trade again – win or lose?

The answer must be Yes to all these questions or we pass on the trade.

Review & Analysis

  • Review the charts after every trading session.
  • Review trade setups and results.
  • If the A-B-C pattern not present, why take the trade?
  • Mark-up additional useful info on the chart.
  • Assess personal performance.
  • Practice visualization techniques to reinforce learning.

This process will help to develop the pattern recognition skill required to identify MABs and FIBCONs.

Considerations

Note: Generally we wait for a Signal Candle (SC) to form before entering a trade.

  • Where is price in the ‘Spike-Channel-Range’ cycle?
  • Can you identify a specific Price Action pattern? (FIBCON, REVFIB, Head & Shoulders (inv), Double Top/Bottom,  etc.)
  • Where was the last REVFIB? If very recent then do not trade against the bullish/bearish momentum.
  • Always take the first M1 MAB after spike/strong move.
  • Always take the first M5 MAB after spike/strong move.
  • Always take the first pullback to a clear Role-Reversal zone.

Trading Plan Video

S.H. Inspired Plan Update

This section has been inspired by Steven Hart who hosts ‘The Trading Channel’. There is a significant overlap between what he teaches and our approach. Over recent months my results were highlighting that the best FIBCONs are those preceded by either a clear DT or DB. S.H. has concluded the same and states that DTs and DBs are at the heart of his trading.

  • “Be The Bear” + “Be The BOT” = “Be The Best” 🙂
  • Have I got a clear DT or DB separated by at least two candles?
  • Is price confluent with an IKZ and Grid structure?
  • If it is a Micro setup then the stop must be above the DT or DB.
  • Enter trade and adjust PT if required based on Grid structure.
  • Apply a rules-based approach to EVERY setup!

Next, make the following a hard-wired routine:

  • Mark up the GZs as they form for each major time frame.
  • Use the wicks of SHs and SLs to mark up Micro IKZs.
  • Constantly mark up the HL/HH & LH/LL points as the session unfolds.

    The 1st PB to the most recent LH or HL is a high-value setup.

Keep asking:

  • Where can I see a clear DT or DB? Do this for all time frames.
  • What is the current PA Pattern in play?

Use alerts to detect a DT or DB. Also, alerts can free you up to do other things like visualize or meditate 🙂