The 50 dollars small account is finally up by around 100 percent.
We have successfully doubled the small Forex Trading Account.
In the last episode, we managed to get this account up to 80 percent in profit.
This time, I was able to spot a good quality setup that had a very good reward to risk
ratio.
In this video, you will learn how I was able to find this trade, that finally got this
account to 100 percent in profit.
Furthermore, you will also see the win rate, the number of trades I had to take to double
the account, and how many number of winners and losers I had along the way.
So if you are trading on a small account, this video will help you see the win rate
required to make money as a trader.
First of all, lets understand the reason behind taking this trade.
This trade was taken on 3 minutes timeframe, and the Forex pair was Euro JPY.
In almost all trading videos I have uploaded on this channel, I always say, take trade
in the direction of the long term trend, and use the 200 period moving average to find
that long term trend.
On this chart, price was in a strong uptrend.
It was above the 200 period exponential moving average.
When I opened this chart, the price was giving a pullback.
Also, the price was respecting the trend line while giving a pullback.
Since the price was above the 200 period moving average, I was only looking to buy.
But when MACD gave a buy entry signal, I didn't immediately buy.
That's because the price was still respecting the strong trendline resistance.
So instead of taking a trade immediately, I waited for the price to break this trend
line resistance, and make a higher high.
If you are watching the Trading Rush Channel for the first time, and don't know about the
MACD strategy, watch the first video on this channel.
It's a trading strategy that had the highest win rate when I tested it 100 times.
Along with the trend line resistance, I also drew other strong supports and resistances
on the chart.
The red lines indicates the strong support and resistance levels, and the orange line
means a weak level.
After MACD gave a buy entry signal, the price was struggling to cross the strong support
level.
This indicates a buying pressure in this area.
But still, price was respecting the trendline resistance.
So I waited for the price to break this area, and make a higher high.
I made a time lapse while staring at the chart.
Now, watch closely.
In this pullback, price was easily making a lower low.
But now, it couldn't make a new low at the resistance I drew.
If you don't know how to draw strong support and resistance area, I have made a video on
that topic, watch it if you want.
When price couldn't make a new low, it was looking like the pullback was over, and the
price was starting to go up.
When the price crossed the trendline and the resistance line, I took a position, and was
hoping for the price to move further up towards the next strong resistance.
Stoploss was below this strong support.
But as you can see, the price did not immediately go further up.
It had a strong rejection at the resistance level, and the next candle that followed was
a big red candle.
This was kind of scary, but since I had the stoploss, below a strong support, the price
didn't touch it, and kept going up.
When I saw that the price was going in my direction as predicted, I closed the trading
platform after adjusting the profit target just below the next strong resistance area.
When I came back.
The profit target was achieved, and the small account had reached its goal.
The price did struggle at the weak resistance i drew, but then it finally broke through.
With this winning trade, the small account was up by more than 100 percent.
Now, in the last video, some people were confused about the position size.
In the trading history, since it says 50 dollars, people think I was risking 50 dollars to make
12 dollars.
No, that's crazy.
On this trade, the number 50, is my position size.
It is not my stoploss.
I also get a similar question asked every time I test a strategy 100 times.
How do you get the same profit and loss number, when the stoploss and profit target are at
different distance every time.
Well, the answer is position size.
Let me explain.
Lets say, there is a 10 dollar stock.
If you buy 1 share of that stock at 10 dollars, your total position value will be 10 dollars.
So if the price goes till 0, you will lose 10.
But lets say, you don't want to hold the position until the price goes to 0.
You have found a support level, where you want to set your stoploss.
Lets say it is at 5 dollars.
Now, if you only buy 1 share at 10 dollars, and have a stoploss at 5 dollars, the amount
you will lose if price touches your stoploss, will be 5 dollars.
Even though you had a position of 10 dollars, you only lost 5 dollars.
Now lets say, you had a stoploss at 9 dollars.
This time, you will only lose 1 dollar, even though your position size was 10 dollars.
Similar thing is happening here.
In this small account, when I trade on smaller timeframes, I have to take bigger positions
to set a tighter stoploss.
Similar thing applies to the fixed profit and stop loss target I use while testing strategies
100 times.
Now, lets answer the question.
How much win rate do you need to make money in trading?
Well, during this small account challenge, I took 51 trades in total.
Out of which, 27 were winners, and 24 were losers.
The win rate I got after taking these trades, was approximately 53 percent.
That's right.
Even with a win rate of approximately 53 percent, I was able to double this Forex account, because
I was taking more profit than my risk.
Most of the time, my reward to risk ratio was higher than 1.
The only time I took 1 to 1 reward risk ratio, was when there was a strong support or resistance
before my profit target.
So, that's all.
We have finally achieved our 100 percent goal.
We have finally double this 50 dollars small account, and you saw it all happening.
All the 10 trades we lost in a row, and recovering from the hole.
Learning from the mistakes of not taking multiple trades at the same time, and other things.
This will probably be the end of this series.
I hope you learnt something from this series.
One of the reasons this small account was profitable so quickly, was because of the
lack of fear.
Since I was only trading with 50 dollars, I had no fear of losing it.
It didn't affect the trading psychology.
On a bigger account, there is always a fear of losing money, no matter how good of a trader
you are.
So if you are new to trading, maybe you should start with a smaller account size, that you
can afford to lose.
This way, you will take trades with your brain, and not with your emotions.
I will probably withdraw the profit to close the account, otherwise the broker will charge
fees again for keeping the account inactive.
Like the video if you liked it.
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If you haven't watched this small account series from the start, go watch now.
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Trading Rush YouTube Channel.
Special Thanks to the wonderful Patrons for supporting Trading Rush on Patreon.
And thanks to everyone for watching.