One of the Key lessons that I learnt which changed the way I look at trading is do not try to copy someone else strategy, its never going to work for you, instead focus on trading concepts and build your own strategy & MM rules. I know I may sound arrogant but realizing this is the key for success in trading. If we study successful traders the key differentiator is that each have found their unique strategy which is in sync to their psychology and you will not find 2 traders following exactly the same strategy and are successful.
There are hundreds of strategies & trading concepts which are freely available on the net and to be frank each of them will make money provided it has been adapted to traders personality. For example, strategy based on Demand & Supply concept by itself has an edge but one need to adapt it to make it natural with our personality, like
@XRAY27 is using market profile which gives him additional confidence in taking the trades, similarly I use flow pivots along with D&S as it is more in sync with my personality.
However strategy is just a small part, the other part is risk & money management, this too need to be in sync with our unique personality and this is where most of the traders fail while following others strategy. Returns are directly proportional to the risk we take, but how much risk to be taken for each trade should be part of our strategy rules which should be as per our risk appetite and cannot be copied from another trader.
If one need holy grail trading strategy, one need to follow these 3 steps which I always follow, I am not asking to follow my advice blindly, just give it a try and see for yourself if it makes any difference:
1. For the strategies that you come across, try to answer the key question for each strategy " Why do you think this strategy makes money?" Answer should not be like Mr. X is trading it successfully or a complex indicator has generated the signal so it should makes money ..
instead see if you can come up with your intuitive reasoning on why it will make money. Among the strategies that you select, identify the one for which you were able to give the simplest reasoning, this is the strategy which meets your personality and will have the confidence to follow without much of internal conflicts. If you understand the strategy which is very important you will be able to easily know the strength and weakness of the strategy to taking actions.
2. Now for this selected strategy identify the set of entry, sl, exit & MM rules under various conditions that you feel comfortable, always approach risk first so that you will be able to measure your returns with respect to risk as it will help in scaling up.
3. Test your strategy by taking minimum 30 trades using the lowest possible risk %, record these in a journal and track results every 10 trades and make any adjustments if required to the strategy rules.
If one is able to do these 3 steps honestly by the end of 30 trades you will have your own personal strategy which is in sync with your personality. This will be your Holy Grail strategy and since you have developed this strategy you will have the confidence to follow it even during draw-down phase.