I tried flipping $1 Live trading 1m Time frames | SMC

Introduction

This tutorial guides you through the process of live trading using a $1 account, focusing on understanding market structures, price action, and liquidity during forex trading sessions. This approach emphasizes the importance of patience, risk management, and strategic entry points, particularly when trading on lower time frames.

Step 1: Understand Market Structure

• Analyze higher time frames (1-hour and 15-minute charts) to identify the general trend and key swing highs and lows.
• Use this information to inform your strategy when shifting to lower time frames (1-minute charts) for detailed price action analysis.
• Key terms:
  • Swing Highs and Lows: Peaks and troughs in price that help identify trends.
  • Market Structure: The arrangement of price movements that indicate the current trend.

Step 2: Identify Liquidity Zones

• Focus on liquidity created during major trading sessions, such as the Asian, London, and New York sessions.
• Recognize that during the London session, the market often targets the liquidity created in the Asian session.
• Look for:
  • Trend Line Liquidity: Areas where price has previously induced traders to buy or sell.
  • Support and Resistance Levels: Historical levels where price has reversed, indicating potential liquidity pools.

Step 3: Recognize Entry and Exit Points

• Use price action to determine entry points:
  • Wait for price manipulation (e.g., break of trend lines) before considering a trade.
  • Identify areas of supply (resistance) and demand (support) for potential trade setups.
• Establish your entry from discount levels (lower price areas) for buying and premium levels (higher price areas) for selling.
• Avoid premature entries, which often lead to losses.

Step 4: Implement Risk Management

• Always assess your risk tolerance before entering trades.
• Consider using smaller lot sizes for lower risk, especially when starting with a small account.
• Use a stop loss to protect your capital. Adjust stop loss levels based on market movement to minimize losses while maximizing potential gains.

Step 5: Monitor Price Action and Adjust Strategies

• Continuously observe how price behaves after entering a trade:
  • If the market is showing signs of reversal, be prepared to exit the trade to limit losses.
  • Look for changes in character (breaks of structure) to confirm trend direction.
• Adjust your stop loss as the price moves in your favor, ensuring you lock in profits.

Step 6: Take Profit Strategically

• Set take profit levels based on identified resistance areas or liquidity zones.
• A good risk-to-reward ratio is crucial; aim for at least a 1:3 ratio, meaning for every unit of risk, you seek to gain three units.

Conclusion

This tutorial has outlined essential steps for trading with a small account effectively. The key takeaways include understanding market structure, identifying liquidity zones, making strategic entries and exits, implementing risk management, and adjusting your strategy based on real-time price action. As you practice these techniques, you can refine your trading skills and potentially increase your account size. Consider documenting your trades and analyses to further enhance your learning experience.