Trading Strategy Section Overview: How to Turn Trends, Pullbacks, and Patterns into a System

In Trading System, we assume you have seen the components of a "Trading System" once.

Now in the Strategy section:

• Chart Basics,
• Indicators,
• Patterns,
• Risk Management

We cover the process of binding what you learned in these into an actual strategy structure.

The goal is Not to find a "secret signal to eat big at once", But to create a "simple strategy that shakes a little less".

1. Why Do You Need a "Strategy"?

Many beginners start like this:

• Turn on the chart,
• Add a few indicators,
• Enter if "something looks good".

It might look lucky in the short term, But in this state:

• You cannot calculate Expectancy,
• It is difficult to keep the 1R structure of Risk-Reward,
• When MDD occurs, It is almost impossible to judge "Is this a normal range, or is the system broken?".

Having a strategy means at least:

1. There is a standard for when to enter,
2. It is decided where to admit being wrong (Stop-loss),
3. There is how far to aim (Target/Exit),
4. And how much to lose per trade (1R) is decided.

With these four:

• You can think from the perspective of a probability game mentioned in Probabilistic Thinking,
• Even if your emotions are shaken, You can check yourself "Can I do the same action if the same situation happens next time?".

2. Broad Classification of Strategies Covered in This Section

Under Strategy, We explain several strategies separately, But looking at the big picture, they can be grouped into five axes.

1. Trend Following Strategy Trend Following

   • In a section where the direction has already emerged,
   • A strategy to ride along that trend.
   • Example: MA-60 Strategy, MACD Strategy, Ichimoku Strategy, DMI/ADX Strategy, etc.

2. Mean Reversion Strategy Mean Reversion

   • When the price is excessively biased,
   • A strategy aiming for the movement returning near the average again.
   • Example: RSI Counter-Trend Strategy, Bollinger Bands Counter-Trend Strategy.

3. Pattern Strategy Pattern-Based

   • Utilizing the structure of S/R Basics and Patterns,
   • S/R, Double Top/Bottom, Breakout/Fakeout, Fibonacci, Elliott, etc.
   • A strategy designed around price patterns.

4. Volume Strategy Volume-Based

   • Not only the price itself,
   • But also looking at the volume flow seen in Volume Basics together,
   • An approach to judge the strength of the trend, reliability of breakout, etc.

5. Dual Momentum Strategy Dual Momentum

   • Not just looking at one item,
   • But comparing the relative strength between multiple assets/sectors to decide "Where to put capital".
   • In this section, we organize mainly around basic concepts.

Although the indicators or patterns used in each strategy article may differ, Ultimately, they are all designed on the choice of:

• Whether to ride the trend,
• Whether to aim for a pullback,
• Or whether to fight only in specific patterns.

3. 5 Elements Common to Any Strategy

Even if the strategy names are different, In practical design, you almost always need to organize the following five things.

3-1. Market Environment Definition (Environment Filter)

• Whether it is currently a trend market or a box market,
• Based on Timeframes, which timeframe to focus on,
• Based on DMI/ADX or ATR, "How roughly the market is moving today"

Organize such elements first.

For example:

• If it is a Trend Following Strategy, You can use sections where ADX is above a certain level, whether it is above/below MA-60 Strategy, etc. as an environment filter.
• If it is a Mean Reversion Strategy, You can filter with box/mixed sections, RSI overbought/oversold sections, etc.

3-2. Entry Conditions (Entry)

• When what pattern/indicator combination appears,
• In what candle,
• Based on what timeframe

Set the rules for entry.

For example:

• Support zone + Based on Candle Patterns, Reversal candle + RSI is in oversold resolution section,

You can set a place where 2~3 conditions overlap like this as an entry candidate.

3-3. Stop-loss Criteria (Stop / Invalidation)

Stop-loss is not simply "How much to lose", But it means:

"The price where I admit this scenario is wrong now"

• Based on S/R Basics, Outside the previous swing low/high,
• Based on ATR, About 1~1.5 ATR margin

By combining these, Decide the point where "Below (or above) this price, my picture is no longer valid".

3-4. Targets & Exits

Depending on the strategy:

• Fixed R/R (e.g., 1:2, 1:3),
• Based on S/R Basics, Next major support/resistance,
• Based on Patterns, Pattern target (e.g., Double Top neckline interval),

Set the basic target using these.

Also:

• A method of taking partial profit and leaving the rest to the trend,
• A method of utilizing trailing stop (moving stop-loss)

Like this, How to protect profits is also part of the strategy.

3-5. Risk & Position Size (Risk & Size)

Finally, the content of Risk Management comes in.

• Based on Risk-Reward, How much to set 1R per trade,
• Based on Position Sizing, ATR Sizing, Depending on the stop-loss distance and account size, How many coins/contracts to hold,
• Based on Max Loss, Up to how many R to allow per day/week,

Only when you decide these, can it be called a completed strategy.

4. Recommended Order to Read This Section

You don't need to understand all strategies perfectly from the beginning. One at a time, just pick what fits your account size and personality.

For example:

1. Learning the Backbone of Trend Following

   • MA-60 Strategy (Simplest moving average based trend strategy)
   • DMI/ADX Strategy (Strategy to view trend direction/strength separately)

2. Adding Mean Reversion Perspective

   • RSI Counter-Trend Strategy
     • Bollinger Bands Counter-Trend Strategy

   → Feel "Not just looking in one direction, but in which section mean reversion is more natural".

3. Developing S/R Sense with Pattern-Based Strategies

   • S/R Pattern Strategy
   • Double Top/Bottom Strategy
   • Breakout/Fakeout Strategy

   → It helps to get used to "Where is the important place".

4. Complementing Filters with Volume/Momentum

   • Volume Strategy
   • Dual Momentum Strategy

   → Can be used to decide which asset/setting is relatively stronger, and where to focus.

5. Questions to Ask Yourself When Reading Strategy Articles

When reading each strategy article, It is good to recall the questions below together.

1. "Does this strategy fit well with the timeframe I mainly watch (e.g., 4-hour, daily)?"

2. "Does the market environment (trend/box) this strategy assumes match the environment I mainly encounter?"

3. "Considering the stop-loss distance and R/R structure, is it executable with my actual account size based on Risk Management?"

4. "If I backtest (practice with past charts), what conditions can I check with data?"

5. "While using this strategy, where would be the most emotionally difficult part for me?"

Instead of just looking at the "return rate" of the strategy, Considering these questions together will help you much more in choosing a strategy that suits you.

The Strategy section:

A practice field for combining parts called "Chart, Indicators, Patterns, Risk Management" into a single simple system

It would be good to see it as such.

• Rather than trying to find a too perfect strategy,
• Decide on one basic strategy,
• And improving it slowly in the detailed articles under Risk Management,

Please remember that this is closer to the way to protect both your account and mentality in the long run.