In terms of trade management, so once we're in the trade, is there anything we should do? Well, my greatest concern whenever I'm, whenever I'm in a trade is to reduce my risk as quickly as possible. So trade management number one for you guys is move your stop to break even at a predefined point. So how do we do that when a trade goes in our intended direction, we then want to think about reducing our risk. As soon as the trade has moved halfway to your target, ie it's gone 40 pips from your execution price, we will move our stop to break even which is essentially moving your stop loss to where you got in however, I have a slight variable on that, I will actually place my stop one PIP above. For bite rates or one PIP below for sale trades my entry price The reason for this is it means that I will always make one Hit profit on every single trade even if it even if I get stopped out, I will still make one PIP profit.

Why do I do that? Well that means that I cover my spread and commission because whenever you take a trade there will be a transaction costs taken by the broker, I want to just make sure that I cover that by making a tiny tiny bit of profit because I don't want that to all add up to reducing my profits at the end of the month. So Place your stop one PIP above your execution level for a buy trade or one pit below for a sell trade once your trade has moved 40 pips or halfway from your execution level. So let's have a look at that visually. So firstly, by trade example we were looking at earlier and ours original entry was 2.0683 original stop loss was 2.0603. However, we want to think about as a trader always want to be taking risk off the table as soon as possible.

We don't want to take the risk off too quickly, because we'll end up getting stopped out and then miss out on the move. However, if it's gone 40 people That's a good confirmation that it's starting to kick in and go in your direction. So when the trade has moved 40 pips, which is halfway to your profit objective. In this example, it would have been 2.07 to three, you would move your stop one PIP above your entry price to 2.0684. Remember, it's one PIP above so that we take a tiny bit of profit to cover the transaction, the transaction costs that take place on every single trade. And voila, as you see here, as illustrated by the blue square 20 minutes later, after our original entry, the trade has moved halfway to our target iE 40 pips.

So the stop loss which is now the red line has moved to break even IE where we got in. However, it's one PIP above where we got in, because that will mean that we always get one PIP from a trade even if the trade goes and stops us out. We will always make one Pip. So as it says, with point three, the best case scenario once you've moved your stop, to break breakeven best case scenario 80 pips profit worst case scenario one PIP profit that is a beautiful position to be in. So we want to get to that position as quickly as possible sometimes it will take a while sometimes it will happen very very quickly. But once you're in a position where your worst case scenario is still a pip profit that is a beautiful position to be in.

Okay, let's have a look at the sell trade example. During this sell trade example on Kiwi dollar original entry was naught point 780 original stock was naught point 7160. So when the trade moves 40 pips lower, ie halfway to your target, which in this example here would be 7040 you would move your stock one PIP below your entry price to 7079 risk has now been taken off the table, a beautiful position to be in. Let's say that and I and voila. Moments later after the original entry, the trade moved halfway to your target, ie 40 pips as illustrated by the blue square stop losses then moved to break even, or one pit below your entry price. So that leaves you with the best case scenario of 80 pips profit.

And the worst case scenario of one PIP profit, which is, again a beautiful position to be in as a trader, because we always want to be reducing our risk. However, we just don't want to reduce our risk too quickly, based on panic, we want to move it when at least the trade has gone some way to your profit objective. And then finally, trade management. Number two, the one hour rule. This is quite a good rule because it's really saying to you, if the trade hasn't gone anywhere, then really the market hasn't reacted to the news in the way that you want it. So when you get a trade plan, bang on or your trade idea is bang on the news comes out exactly as you wanted it.

The trade really should just go in your intended direction like we've seen those with those last two examples. The trader does really go in one direction and go pretty quick and not look back, giving the trade at least one hour Work that should say after news to move at least halfway to your target is sufficient. Because really, if it hasn't moved within one hour, the market isn't reacting to that news. On some occasions, as it says there, the trade will just not do as you expect and won't really move anywhere. On these occasions. If the trade hasn't even got to your 40 PIP halfway target, simply close the trade, irrelevant of the p&l.

So you could be in a negative position, or you could be in a slightly positive position. But if it hasn't gone anywhere, after an hour, it means the market is really not reacted to that piece of news as you expect it to really, as you will see, when you go away and take trades when your trade plan comes to fruition, and a news announcement really generates massive momentum, the trade will really just go in one direction. If it doesn't, and it's stagnating. The market hasn't really reacted that particular news announcement for for any old reason we don't know what the reasons may be, but for for any reason, they haven't reacted to that before. Get a news announcement. So if you have the ability to cut the trade off for less than 80 pips, that's still a very, very good thing.

So as it says, with the last point, the trade should have started to move in that direction by now, if it hasn't, it's a warning sign. So one hour after your execution, if it's not really gone anywhere, I hasn't stopped you out, it hasn't gone 40 pips in your direction, then you can just cut that trade and take the take the small loss or the small gain, and move on to the next opportunity. And the whole process, the whole approach that we want as a news based trader is to keep our losses small, but to let our winners run. So as you're seeing with the management of our trades, a lot of your trades are either going to be small losses because you'll cut them after an hour, or you'll get stopped out at breakeven by using your number one management. So a lot of your losses will be very, very small.

You will get the occasional trays that stop you out for 80 pips but it's very, very rare. It's going to be very, very rare. Most of your losses will be small. Even though we have an 80 PIP stop, it doesn't mean that that will be hit on every single losing trade. That's that's important to know. We have an 80 PIP stop, but that doesn't mean that every losing trade will hit your 80 PIP stop.

More often than not, you'll either cut it after an hour for a smaller loss than 80 pips or your stock will have been moved to breakeven. The trade then stops you out, but you benefit from having that one PIP gain by keeping your trailing stop or your your breakeven stop one PIP above or below your entry price. And by doing this by keeping your losses small, and letting your winners run to go to those 80 pips, what we're looking to do is make a positive amount of pips from our trades every single month. So if we make a net gain of 300 pips and our net loss of pips is 50. Then that gives us a gain of 250 pips so we're looking to be PIP positive As you see in the risk management section, our risk management is going to mean that our position size is going to remain the same every single trade so for example, every single trade we take a trade at one pound per Pip, so every PIP is equated to one pound.

So if we make 10 pips we make 10 pounds if we lose 10 pips, we lose 10 pounds. So if we make a positive amount of pips at the end of the month, we're making a positive amount of money. So that's what we're looking to do keep our losses small, and let our winners run so bigger profits than our losses. So over time, we end the month with a positive peppermint, which translates inevitably, as you'll see in the risk management section to a positive monetary gain. Okay, so just to summarize this section, it's all about instant execution. Get into those trades as soon as possible when your trade plan comes together.

Use the resources to help you get into those trades as soon as the news is Released. When you're in a trade, we want to be putting our stop loss on at 80 pips above or below the entry depending on the direction. I'll show you how to do that very, very quickly when we go through the demonstration video on the platforms, which will be in the next couple of lectures, your target, which is where you're looking to take your profit to be placed 80 pips above or below your entry, depending on the direction we've looked at the buy and sell variants in previous slides. And it's a fairly fixed strategy. So as as we've talked about, it's a very fixed one to one strategy one to one meaning reward to risk at at. However in time, you will learn to add discretion based on your experience, looking to increase your rewards even more whilst reducing your risk further.

So even though it's a very fixed strategy at this time, with experience, you will learn to add discretion. I'll support you on that, where you can treat each trip on an individual case by case basis, some you'll leave to run for 300 400 pips rather than 80 pips as an example of using a bit of discretion. So you're starting to know what news announcements are affecting currencies more than others. So, for example, if you know that inflation is likely to have a bigger move than employment on the Euro, you'll probably leave your your trade after inflation to run a little bit longer than you would unemployment. So that's just a one illustration of how you will use a little bit of discretion, going forward to help benefit you further, where you still take the same approach of maximizing your gains and minimizing your risk. But you do that 234 times to what we're doing it at this day.

So you've got lots to look forward to going forward. But for now, I want to keep it as black and white as simple as possible so that you have the ability to execute a few trades which will give you the ability to build up experience which will give you the ability to build up discretion. And as I've said loads of videos in addition to this one in the curriculum to bring this light to life for you. So I've done lots of videos where I show you how I enter, where I put my stop loss and where I put my target and how I trail stops as well. So take check those out and that will really bring it to life for you and solidify and cement everything you've learned in this presentation.