Favourite Techniques from Mastering the Trade

Here are my favourite techniques from Mastering the Trades by John Carter:

HOLP and LOHP

HOLP and LOHP stand for "High of Low Period" and "Low of High Period" respectively, and are reversal-catching techniques. Works best on faily and hourly charts.

1. Identify a trending market, say a uptrend, that is making a 20-bar-ish high.
   
2. Find the high bar in the trend (biggest open-close distance).
3. Enter as soon as the price closes below the high of the high bar.
4. Initial stop will be the high of the high bar. If the next two bars are also bearish, trail the stop to the high of the second bar, and the process repeat until the next pair of bearish bars.
   

The BB Squeeze

http://www.tradethemarkets.com/products/item5.cfm (MT4 version available here)

It is a method for catching big moves, usually a breakout after overnight activity. Can be used with smaller timeframes for intraday trading.

1. Setup: Bolliger Band (20,2), Keltner Channel (20, 1.5) and Momentum (12,close)
2. When BB is inside KC, it is a slow market. When BB is outside KC, there is an increase of voltility.
3. Enter trade when BB>KC and momentum is rising.
4. No hard rules for TP and SL, but usually exit when momentum weakens.

An indicator is actually developed for the system (which you may download here):

Key:

• Red dot: BB <>
• Green dot: BB > KC;
• Histogram: Momentum
  

Box Plays

Another name for classic breakout trading. Best for liquid market like EURUSD.

1. Identify a ranging market and it's highest and lowest level.
   
2. Sell a stop at low and buy a stop at high, so that they are each other's stop loss.
3. Set a TP that is slightly higher than the SL, say 1:1.2.
   

Scalper Buy and Sell

http://www.tradethemarkets.com/products/item7.cfm

Easily the easiest method to follow. Best to be used with pivot levels or S/R lines. Works on any time frame.

1. Buy on three consecutive higher closes.
2. Exit on three consecutive lower closes.
3. Filter: the close of the thrid bar should be higher than the high of the first bar.
4. If it is an intraday trade (like: M15), exit all positions at 4:15 pm EST.
   
5. Opposite for selling.