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The Academy of Financial Trading
Ultimate Traders Programme
Part 7. Application
Risk Warning
Any Advice or information provided by the Academy of Financial
Trading is General Advice Only - It does not take into account your
personal circumstances, please do not trade or invest based solely
on this information. By viewing any material provided by the
Academy of Financial Trading or using any information or tools you
agree that this is general educational material and you will not hold
any person or entity responsible for loss or damages resulting from
the content or general advice provided here by The Academy of
Financial Trading, it's employees, directors or fellow members.
Futures, Contracts for Difference (CFDs), Options, and spot currency
trading have large potential rewards, but also large potential risks.
You must be aware of the risks and be willing to accept them in order
to invest in CFDs and leveraged forex markets. Do not trade with
money you can not afford to lose. No representation is being made
that any account will or is likely to achieve profits or losses similar
to those discussed in any material provided by the Academy of
Financial Trading. The past performance of any trading system or
methodology is not necessarily indicative of future results.
Entries, Exits and Application
Core principle – Exits with losses are 2ATR ALWAYS.
Exits with profit we have far
EWT = 21 days in and 10 days out
SMS = 52 days in and 21 days out
When you exit the SMS at 21 day retracement, this is also
time to consider an EWT opposite entry. This is because
our SMS exit is identical to our EWT entry assuming the
profit filter has been satisfied
A natural trailing stop based price action works much
better
Diversification
• Spreading risk
• Attempting to secure greater return through Asset Allocation
• Other Tool to reduce risk was hedging which we have done via
Longs and Shorts - in the only form we could teach sufficiently in
such a short time period
Examples:
• Bonds may rise in a weak economy
• Small Caps can rise earliest during the beginning of a recovery
• Large Caps come much later
• US firms thrive on a weak USD
• Foreign Firms favour a strong USD
Key points for Equities are:
• Size
• Country
• Sector
Diversification
• Examples:
• US small caps
• US large caps
• Bonds – mixture
• Commodities
• FX
Diversification - Equities
Possibly two/three of below US Equities Large Cap
• JNJ app 1.5k [usa.jnj]
• Pfizer app 1k [usa.pfe]
• Microsoft app 1.5k [ndq.msft]
One of the below US Tech Stocks
• Google app 3k [ndq.goog]
• Yahoo app 1k [ndq.yhoo]
One of the Below US Banks
• JP Morgan app 3k [usa.jpm]
• Citigroup app 3k [usa.c]
• BOA app 1k [usa.bac]
Non US Possibly Two Dependant on Size
• BMW app 4.5k [Fft.bmwg]
• Siemens app 3k [xtr.siegen]
• DB app 2k [xtr.DBKGn]
Diversification - Commodities
One of the below Energies
• Crude app 3k [nymex.cl]
One of the Below Softs
• Coffee app 8k
• Sugar app 6k
• Cotton app 4k
• Or a related Stock
One of the Below Metals
• Silver app 12k [xagusd]
• Gold app 4k [xauusd]
One of the below Agricultural
• Look for an Agricultural type stock
Diversification - Commodities
One of the below Index
• S&P500 app 3k [cme.es]
• Or a related Stock or Market
One of the Below Bonds/Govt Paper
• Eurobund app 2k
• 10 Year app 1k
• Or a related Stock or Market
Two Plus Dependant on Funds of the Below FX
• Any once not correlated
Sample Portfolio
• 2/4 US Equities
• 2 European Equities
• 1 Energy
• 1 Soft
• 1 Metal
• 1 Agricultural
• 1 Index
• 1 Bond/Govt Paper
• 2 + FX
• If less funds more FX is possibility and less US and EU Equities
• Be careful with FX re correlation +/-!
• Let us now put them on from start to finish
Last Theoretical Closed Trade - LTCT
• We measure the Most Recent Touch of the 21/Blue Line to the Previous
Opposite Touch of the 21 line/Blue Line
• We then ensure the most recent touch would have been the exit!
• We then ask ourselves - had we entered at the former and exited at the latter
would we have generated a profit or loss?
• If it had been a profit we skip the next entry on the EWT
• This is because we don’t typically see V formations
• This has no bearing on the SMS as we take all trades on the SMS
Most Recent
Last Opposite
Last Theoretical Closed Trade - LTCT
• Most Recent Touch of the 21/Blue Line to the Previous Opposite Touch of the 21
line/Blue Line
• We then ensure the most recent touch would have been the exit!
• Had we entered at the former and exited at the latter would we have generated a profit
or loss?
• If profit we skip the next entry on the EWT [V Filter]
• Only for EWT NOT SMS
Most Recent
Last Opposite Step 1
Last Opposite
Most Recent
Last Theoretical Closed Trade - LTCT
• Most Recent Touch of the 21/Blue Line to the Previous Opposite Touch of the 21
line/Blue Line
• We then ensure the most recent touch would have been the Actual Exit!!!!
• Had we entered at the former and exited at the latter would we have generated a profit
or loss?
• If profit we skip the next entry on the EWT [V Filter]
• Only for EWT NOT SMS
Most Recent
Last Opposite Step 1
Last Opposite
Most Recent
Actual Exit
Last Theoretical Closed Trade - LTCT
• Most Recent Touch of the 21/Blue Line to the Previous Opposite Touch of the 21
line/Blue Line
• We then ensure the most recent touch would have been the Actual Exit!!!!
• Had we entered at the former and exited at the latter would we have generated a profit
or loss?
• If profit we skip the next entry on the EWT [V Filter]
• Only for EWT NOT SMS
Most Recent
Last Opposite
Last Theoretical Closed Trade - LTCT
• Most Recent Touch of the 21/Blue Line to the Previous Opposite Touch of the 21
line/Blue Line
• We then ensure the most recent touch would have been the Actual Exit!!!!
• Had we entered at the former and exited at the latter would we have generated a profit
or loss?
• If profit we skip the next entry on the EWT [V Filter]
• Only for EWT NOT SMS
Most Recent
Last Opposite
Actual Exit
Real Time Trade Set Ups and Application on
MT4 with the UTI Indicator
Q & A
www.academyft.com
Contact us anytime on
Ire: +353 (0)1 685 4102
UK: +44 (0)207 193 1525
USA: +1 347 627 0001
Thank You!
www.academyft.com
Contact us anytime on
Ire: +353 (0)1 685 4102
UK: +44 (0)207 193 1525
USA: +1 347 627 0001
Keep Learning!
