MTF Trading System That Basically Uses 3 Timeframes To Identify A Small Stop Loss!!

You can download this MTF  Trading System 27 page PDF FREE. MTF means multi-timeframe. Using this MTF approach, you can reduce the stop loss of your trading system to under 20 pips per trade. This is something that you must do as it will drastically reduce the risk of your system.

MTF Trading System

As a professional trader, your goal should be to improve your trading system constantly. In this post, we are going to discuss a Multi Timeframe approach that can help improve your trading system drastically by reducing the stop loss to the lowest possible level. If you want to use a stop loss that is not more than 10-20 pips per trade than read on. Trading with a small sop loss of 10-20 pips means very low risk. Now if you have a swing trading system that is designed to catch 100-200 pip movement then reducing the risk to 10-20 pips means you can improve the reward to risk ratio of your system to 10:1 or even more. This MTF Trading System is going to show you how to do it. This PDF is going to show you how to further improve your trading system.

In essence what we will be doing is basically use three timeframes. This will help us in reducing our stop loss from the usual 30-50 pips to just 10-20 pips. By reducing the stop loss, you will be able to drastically reduce the risk per trade. So let’s discuss this MTF Trading System. We will be using three timeframes as said above. The first is the longer term timeframe. The second is the medium term timeframe and the third one is the short term timeframe. The longer term timeframe is used to judge the general direction of the market. The medium term timeframe was previously being used to make the entry and exit decisions. But now you will use the shorter term timeframe to make that decision. First you will check the trading signals on the medium term timeframe and then switch to the shorter term timeframe. The longer term timeframe should be 4-5 times higher than the medium term timeframe which should be also 4-5 times higher than the shorter term timeframe. I have used this approach to drastically reduce the stop loss that I use in my Divergence Trading System.

Tri Screen Trading Approach

H4, H1 and M15 form a very good Tri Screen Trading System. H4 is 4 times H1 which is also 4 times M15.  By using this approach you will get a very clear picture of what is happening in the market. I daily trade using my Divergence Trading System. This is what I do. First I find the direction of the market on the H4 timeframe. Then I check the H1 timeframe and finally I move to the M15 timeframe to make the entry and the exit decisions. The divergence pattern first appears on the M15 timeframe. After that it appears on the H1 and the H4 timeframes. I wait for the divergence pattern to appear on the H1 timeframe. Once it appears on the H1 timeframe, I use the M15 timeframe to make the entry.

By trading this way, I most of the time is able to pin point the exact top and bottom of the price chart with an accuracy of 10-20 pips. So most of the time I am able to use a stop loss that is between 10-20 pips. I only trade the two currency pairs EUR/USD and the GBP/USD. The daily range of EUR/USD is between 100-140 pips while that of GBP/USD is between 150-200 pips. These daily ranges help me in deciding the profit target each day. My target most of the time is 100-200 pips. So you can well imagine each trade usually will have a reward to risk ratio of 10:1. Now even if I lose 40% of the time, I can make more pips than I lose. A win rate of 40% means that I lose on average 80 pips while I make on average of 600 pips in 10 trades. As you can see just by reducing the stop loss of my system, I have been able to drastically improve the bottom line of my trading system.

I don’t need to be right all the time. I have the flexibility of being wrong 40% of the time. What this means is that even if I make a wrong entry and the stop loss is hit, I will lose 20 pips and I can make another try. Suppose this time I made 150 pips, deducting the 20 pips that I had lost, I made net 130 pips which is not bad. Now the above Tri Screen MTF Trading approach can be applied to any trading system. Whatever trading system that you are using, you can use this multi timeframe approach to further improve it drastically. As a trader, your goal is to keep on improving your trading system. Any method or approach that can help you to further improve your trading system should be welcome. This MTF Trading System approach will help you do that. You can download this MTF Trading System PDF FREE.

12 Comments

  • Drad

    October 26, 2012

    Pls send me the above – it wasn’t taking my email? Thx

  • Doug

    January 26, 2013

    please send me the MTF Trading System 27 page PDF FREE. MTF – and thank you very much for your insight and generosity

    • admin

      January 27, 2013

      Hi Doug, just click on the like button and the download link will appear instantly below it.

      Best
      Hassam

  • MONO ALDO

    February 27, 2013

    WOW… GREAT !!!!

  • Alton

    April 3, 2013

    I am interested in back testing your system, thanks, Alton.

    • admin

      April 4, 2013

      Hi Alton, this report is about a multi timeframe approach that you can use to drastically reduce the risk of your system. For example, if your system mainly trades on H1 timeframe, you can use M15 timeframe to make the entry decisions. This will help you enter the market using a small stop loss. So there is no backtest here as this is not a system. An approach or a method has been described in this report that can be used to improve any system and reduce the risk of trading with it.

      As far as backtests are concerned, they are marketing gimmicks. Backtests mean nothing. A good backtest is useless when it comes to live trading. Only thing that matters is live trading. Markets keep on changing so whatever that happened in the past is not going to repeat again. Market will always surprise you with something new each time. So backtests don’t work. Forward test on a demo account can give a good idea about a systems performance. The ultimate test of a system is live trading, however!

      Best Regards
      Hassam

  • John

    April 5, 2013

    Looks interesting and promising.

  • Srinivas

    October 28, 2013

    Every thing is very interesting rush me detail immediately

    Thanking you in advance
    S.R.Chavan
    Mob:+91 8123453647
    email:reachchavan@gmail.com

  • oba

    December 7, 2013

    i will give it a try.

  • joseph

    February 13, 2014

    Great stuff

  • Kat

    January 6, 2015

    Why do you not provide the download link of the free 23 page pdf report? I have liked your site on FB but no link??? Are you a fraud???

    • admin

      January 11, 2015

      I have removed the plugin that was not working. Now the MTF Trading System PDF download link is at the very bottom of the post. After you download the PDF, please don’t forget to click on the Facebook Like button.