Document Sample
BFT-Guide-to-Maximum-Advantage-Forex-Nov-2011 Powered By Docstoc
					   T HE B E R E S F O R D T R A D E

      GUID E T O MA X IM U M


    B Y C HA R L E S M B OW E N
                                                                        The Beresford Trade Guide to
                                                                         Maximum Advantage Forex

                                         About The Author

Charles M Bowen is the founder of Beresford Trade, a private equity firm and

Introducing Broker. He currently travels between offices in Miami, London, and Jakarta.

He is married with two wonderful children. His other interests include writing, sailing,

and golf. He holds a Bachelors Degree in International Relations from Florida

International Univeristy, as well as a Masters of International Business From Hult

International Business School.

 I dedicate this book to my wonderful wife, without whose patience and understanding I
 would never have reached a position to write it, and to all the traders who have helped
                                   me along the way

                                     Copyright 2010, Beresford Trade LLC

If you are dow nloaded this document from any person, w ebsite, file-sharing program or organization not affiliated w ith Beresford
Trade LLC then you are stealing. If you paid for this document, the person or organization w ho sold it to you is guilty of copyright
    infringement and they robbed you. This ebook is emailed free of charge to prospective Clients of Beresford Trade ONLY

                                                       Page 2
                                                 The Beresford Trade Guide to
                                                  Maximum Advantage Forex

                            Table of Contents

Chapter 1: Forex Overview: Basic Principles                                     4

Introduction, how a client benefits from our system

Chapter 2: Navigating the Mirror Trader                                         16

A brief tour with explanations and how to take advantage of Mirror Trader’s features
with several strategies

Chapter 3: Tying it All Together                                                33

The secret to our success, review of the keys to successful Forex Trading

Appendix                                                                        40
The best performing mirror trader strategies for 5 popular currency pairs involving the

                                        Page 3
                                            The Beresford Trade Guide to
                                             Maximum Advantage Forex

                    Forex Overview: Basic Principles

      When it comes to working independently from your PC, there is day-

trading, and then there is everything else. While other ways to earn a living

online, such as article writing, do indeed exist, those jobs will typically

provide an income closer to minimum wage in exchange for many long

hours of effort. The employers can easily disappear into the anonymity of

the internet without paying out a dime, something that cannot happen in

Forex so long as you invest with a regulated broker. While we have a list of

online job services that we have reviewed posted on our site, they’re only

there to help prospective clients raise the seed money required to take

advantage of the only home business opportunity capable of providing a 5-

figure weekly income: Trading the Forex.

      In this ebook, I will share the exact strategy that has enabled me to

fully support myself trading the Forex through the AVA Mirror Trader and

AVA Trade platforms. In order to take advantage of my method, you must

start by opening a free practice account with AVA by clicking here.
                                     Page 4
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

      I won’t go into too much detail regarding the mechanics of Forex

trading, because AVA FX provides outstanding resources explaining

strategies, trading systems, technical analysis and fundamental analysis in

their online forex education section. Information on other strategies can be

found there as well as in the articles directory on my website

      So why should you listen to me? Why should you believe I have a

stake in your success? I'll not bore you with a long-winded autobiography,

but a little background about the author seems fit. I am 31 years old, was

born in America and currently divide my time between London, Jakarta, and

Florida, where I founded my company 2 years ago.

      I was always a bookworm as a kid, favoring current events, history,

and encyclopedias. By the time I was 11 years old, I could rattle off the

Royal family trees of Europe in sequential order dating back to the 12th

century, list the complete jet inventory of the NATO air forces by aircraft

type and capability, quote Franklin, Nietzsche, Keynes and Freidman, and

relate the monthly value of the dollar relative to the pound for the past 2

years. While you don’t strictly NEED a photographic memory to trade the

Forex, it doesn’t hurt. All this knowledge and a desire to share it didn't
                                    Page 5
                                             The Beresford Trade Guide to
                                              Maximum Advantage Forex

make me as popular as you might think it should. In hindsight I consider it a

blessing that I wasn’t the proverbial social butterfly; I ended up learning

more on subjects of interest to me whilst most people my age were more

interested in getting drunk!

      When I was just finishing high school, I became intrigued by online

day trading when introduced to it via a school project. Even at that age I

was already working at a sales job and the first thing I realized was,

notwithstanding the fact that I made decent money, that slaving away at a

9-to-five where you’re always one closed-door meeting away from

unemployment without due credit for your achievements is no way for any

self-respecting human being to live. I resolved to endure working for

someone else only as long as I had to. I got into serious Forex trading in

my early twenties. I was seeking a source of income that did not rely on

anyone but myself that would be just as profitable whether I was in

Barcelona or Nepal. I can testify to how effective Forex trading is for that

purpose as for three years I supported myself with day-trades whilst

backpacking in Europe and Southeast Asia. The laptop I was using at the

time still proudly bears the scars from the abuse of being lugged from

hotspot to hotspot in conditions that would petrify some people. I have been
                                      Page 6
                                            The Beresford Trade Guide to
                                             Maximum Advantage Forex

trading the Forex on the AVA FX platform for over four years now. I settled

on them for reasons that will be made clear in due course. A quick

disclaimer before we get going, this ebook is not in any way a commercial

for AVA FX. They did not participate in its creation, endorse it in any way, or

even know that it exists as far as I’m aware. Once you are profiting from my

strategy, perhaps you will be just as motivated as I am to keep it that way!

      Thanks to the system I devised for myself, within some years I had

enough funds to settle down, start a family, incorporate my activities as a

business, and devote myself to spreading the word on how regular people

can liberate themselves from the drudgery of wage-slavery.

      My motivation in ensuring that you become a fabulously wealthy

Forex trader is; that as an introducing broker, AVA FX shares a small

percentage of the spreads from the trades made by clients I refer. If a client

loses their entire investment fund in a week, then I am not earning very

much over the long term now, am I? People who do what I do need

hundreds of clients actively trading continuously over the long term to make

it worth the effort. So, in the plainest possible terms: I get richer in the

process of making you rich, and I think anyone will tell you that’s a pretty

darn sound motivation for seeking to make total strangers into millionaires.
                                     Page 7
                                            The Beresford Trade Guide to
                                             Maximum Advantage Forex

      . The Forex is a 24 hour market where foreign currencies are traded.

With over $3 trillion in daily turnover, this market is larger than all the other

global investment markets such as Stock exchanges, and commodities

brokerages combined. This market can only grow exponentially as the

global economy continuously requires ever-larger transfers of different

currencies between merchants. The rise the Internet provided the

necessary technology to put this market within reach of the individual

investor and out of the clutches of large banks and governments. While

there are enough advantages associated with trading the Forex to fill a

shelf of books devoted to them, some of the key points include:

     The Forex is a 24 hour market. Anyone can trade it, from anywhere in

the world, at any time.

     The Forex moves in trends. Currency movements are more sustained

and predictable than other investment vehicles.

     High margin allows small investors to control vast currency lots.

Stock markets typically require 30% of trading capital to come out of the

investors pocket. The higher margin available in the Forex means an

investor with only $100 can control the profits (or loss) on $100,000 or

                                     Page 8
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex


     You can profit under any market conditions. You can choose to profit

off a currency when it gains in value, or when it loses value.

     It is easy to learn. A trader needs only a secondary-school

competency in mat, be able to understand a chart and possess and the

ability to attach meaning to some key terms to grasp the basics, unlike

stock trading which requires a vast set of business knowledge and an

encyclopedia of background knowledge to trade with anything approaching

the level of accuracy seasoned Forex traders can achieve their currency


     There are vast resources out there to help you. Since the trading

houses, online brokerages, and Introducing Brokers like Beresford Trade

depend on our clients trading profitably on a consistent basis, new traders

start out with a set of service providers with a powerful stake in your

success, unlike the other major work from home industries, like online

marketing or “Data Entry’’, where your “partners’’ usually charge you $60

for a stale marketing ebook and never want to hear from you again, Your

Forex brokers make every reasonable effort to build a mutually beneficial
                                    Page 9
                                              The Beresford Trade Guide to
                                               Maximum Advantage Forex

relationship with you right from the start.

     Unlimited potential. Strategies that work for a $300 account are easily

scalable to be just as effective with a $3,000,000 account.

      You grasped at least a few of these points before you began to read

this, the fact that you do is probably why you set up a practice account in

the first place! Yet the road to successful Forex trading is paved with the

bloodied remains of novice traders who failed to make it. Top reasons for

this include:

     Trading Emotionally: Fear, euphoria, and nervousness can lead the

trader to irrational decisions. A panicky trader who closes losing positions

that are only 20 pips or so under profit is throwing away lots of potentially

profitable trades

     Bad Money Management. Investing more than 2-5% of your capital

on a single trade, and using more than 50% of your cumulative margin is a

recipe for disaster. Over commitment can wipe a trader out in a single day.

A deep reserve of equity allows you to hold losing positions almost

indefinitely, allowing most of them to turn around… eventually!

     Inconsistency. While trading a variety of currencies can be a good

hedge against volatility, entering into dozens of positions without a solid
                                    Page 10
                                          The Beresford Trade Guide to
                                           Maximum Advantage Forex

grasp of those currency pair's technical and fundamental strengths or

weaknesses more like gambling than proper trading. Traders should have

studied each currency pair they trade in depth before committing real cash.

     They Trade Exotics. Thinly traded currencies have larger spreads,

that is, large gaps between the buy/sell rate. Too often, traders anticipating

a move on a thinly traded pair do not take into account that the high spread

on these currencies gives each position more ground to make up. For

example, a currency pair with a 4 pip spread means the pair must only gain

5 basis points to move into profit. A pair with a 19 pip spread needs to gain

20 points. This is easily avoided by only trading low-spread pairs, such as

those involving the USD. However, some traders choose to master thinly

traded currencies as the trends last longer and are more predictable.

                                   Page 11
                                            The Beresford Trade Guide to
                                             Maximum Advantage Forex

                ''10 Rules for Successful Forex Trading''

1.    You Shall Not Trade in Ignorance

2.    You Will Never invest more than 2-5% of your Capital in a Single


3.    You Will Never Hold Open positions Equal to More than 40% of Your

Capital at the Outset of the Trade.

4.    Let Your Profits Run.

5.    Do not Close Your Losing trades too Soon.

6.    Set Realistic Weekly Goals (2-10% profit per week)

7.    You Can Never Know Too Much About the Pairs You Trade

8.    Stick to Pairs involving the US Dollar Until You can Recite 6 months

of Stats on the Exotics You Want to trade

9.    Let Your Profits Run

10.   You Shall Not Trade In Ignorance

      The redundancy is deliberate. Some of my rules are a matter of

preference, but there are precious few traders out there who last very long

without sticking to the repeated points. Letting your profits run refers to
                                     Page 12
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

holding profitable trades to allow for more gains. While this may appear to

be common sense, too many people will be so petrified at the prospect of a

position moving against them, that they will cash out at 20 pips on a trade

that a patient person could have held until it reached profit of over 100

basis points.

      Not trading in ignorance is achieved by initially choosing three

currency pairs to follow, and getting to know their positional histories. This

is the key to technical analysis. Before considering opening a position, a

trader should spend some time looking over the previous daily, weekly, and

monthly charts, reading morning analysis reports like those provided at no

cost by AVA FX, and perhaps using that data using our free advanced

predictive forex trading calculators on the Beresford Trade web site

      Forex trading with the AVA platform comes in two flavors, manual

trading and auto-trading. The names pretty much describe the difference

between the two. While manual trading platforms typically offer slightly

lower spreads, the level of required knowledge, time commitment, and

calculations required to maintain consistent profits make it most suitable for

institutional investors, experienced Forex traders, or individuals with the

time and desire to manage the entire trading process on their own.
                                    Page 13
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

      Since this book is focused towards novice traders, we will focus on

the auto-trading platform, Mirror Trader, which enables the trader to follow a

huge variety of trading systems. If you have already opened a practice

account with the AVA Trader manual platform, don’t panic, the system we

are describing here can be applied with a manual account as well, although

you will need at least a Mirror Trader practice account to use it properly.

While it IS possible to use our strategy with the manual platform on a live

account (It may even work to your advantage if you can only spare the

$100 minimum capital required for the AVA Trade account, but you didn’t

hear that from me ;), bear in mind that a trader doing this will have to

master two platforms. We prize the Mirror Trader for its combination of

automation, first-class technical analysis, and, most importantly, as you will

see later, the ability to open manual trades.

      Wait a moment, didn’t we just say that manual trading requires more

commitment and risk?! That is perfectly true for the uninitiated, but we here

at Beresford Trade have profitably combined the best of both worlds for quite

some time now!

     Auto-trading's superficial advantage is that it allows the trader to be

active in the market without needing to do, well, much of anything after
                                    Page 14
                                             The Beresford Trade Guide to
                                              Maximum Advantage Forex

choosing which strategies to follow. As alluring as this prospect may be,

auto-trading must be approached carefully. Even some top-scoring signal

providers experience significant drawdowns from time to time, and

following too many signal providers who simultaneously go into drawdown

can easily lead your account to cross the 40% margin commitment and

potentially lead to a margin call. This risk is amplified if the trading capital is

close to the minimum of $1000.

       Our system of Forex trading relies on taking advantage of the signal

provider’s moves, combined with basic technical analysis, to identify the

optimal moments to enter or close a position as well as a devastatingly

simple procedure to avoid letting capital over commitment . But before we

share those details, you need to know how the Mirror Trader works.

                                     Page 15
                                            The Beresford Trade Guide to
                                             Maximum Advantage Forex

                     Chapter 2. Mirror Trader Tutorial

      The first thing to do when you first log into your account is to choose

your strategies. Click the “Strategies’’ tab. Then click the middle button

(with the twin magnifying glass icon) on the left that reads “custom filter”.

Remember back in chapter 1 when I explained that it is best to trade only a

few currency pairs that you research diligently? Take as much time as you

need to decide which three you want to focus on. Not sure? An overview of

the most popular currencies to trade the USD with is available in my online

article, Fundamental Analysis of Major Currency Pairs . Now, once you’re ready,

click the “Symbol” tab at the bottom and choose EUR-USD. This is a

heavily traded pair with a good mix of volatility and low spreads, although

you can choose any three you like. Other pairs with lots of signal providers

that fit out criteria include the USD/JPY, USD/GBP, and USD/AUD. Traders

should become familiar with how to pull up data from the charts. We won’t

cover how to read them here, as the education pages on the AVA FX

website covers it comprehensively.

      Next, we will explain what the terms at the head of the columns in our

                                    Page 16
                                          The Beresford Trade Guide to
                                           Maximum Advantage Forex

strategy search window mean, and how best to use them.

   T Score: The platform’s scoring system. The T-score indicates how

     relevant the strategies moves have been compared to current market


   Total Trades: How many trades the strategy has opened in the given

     time period.

   Max DD (Draw-Down): This is the maximum losing streak, in pips,

     that the strategy has suffered in a row. This is very useful in

     foreseeing the “worst case scenario’’ before adding the strategy to

     your portfolio. We do not recommend the COMBINED max drawdown

                                   Page 17
                                        The Beresford Trade Guide to
                                         Maximum Advantage Forex

   of the strategies in your portfolio to exceed 40% of your trading

   capital. Conservative traders may be more comfortable with a 25-

   30% Max DD to trading capital ratio. For example, If you plan on

   investing in a $2000 trading account, and you choose to follow 2

   strategies with a max DD of -300, you are cutting it pretty close to the

   margin of safety. To follow multiple strategies, simply limit them to one

   or two positions at a time. You can view the strategies with the lowest

   DD by clicking the maxDD link at the head of the appropriate column.

   There are actually dozens of strategies with a Max DD of 0. Many of

   these, however, make only 2 or three trades per month.

 Pips : The profit (or loss) of each strategy in pips, the smallest basis

   point in forex (0.0001, or one-hundredth of a cent). The Mirror

   Trader’s minimum lot order is 10,000 currency units. Since Mirror

   Trader operates at 200:1 Margin, each lot costs $50. At this level,

   your profit/loss potential is approximately $1 per pip, although it may

   be higher when trading certain currencies, especially the JPY. Do not

   ever give a strategy you subscribe to permission to open a position

   with more than the minimum mini-lot. If you would like to see the top-

   scoring strategy based on pips, simply click ‘Pips’. Basing which
                                 Page 18
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

      strategies to follow on pips profit alone can be risky, just compare the

      max DD on the high pip-profit strategies below to those with high T-

      scores in the previous screenshot to see the difference in risk.

      You can find the strategies that best fit your investment budget and

risk appetite by clicking on the strategy name and viewing the strategy

card. The first page of the strategy card shows a graph displaying the

cumulative profit/loss in pips.

                                    Page 19
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

      The next page lists the statistics of that strategy, such as most

profitable trade, biggest loss, and the average time each position is active.

      The next two pages list the current open positions, and a list of past

trades. You can view the entire trading history of the strategy if you wish.

      The last page is the strategy description. Here you learn whether the

        strategy is an automated Forex robot, or an individual trader

                                    Page 20
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

      Choose 3-5 strategies for each of the currency pairs that you will

trade. Now, to safely follow this many strategies with a live account would

require a VERY large investment to trade safely, but our objective at this

point is to allow you to observe how as many of the strategies you’re

interested in performing.

      Once you have your account configured, let it run. Check up on it a

couple of times a day during the first week. Do not open any manual trades

yet. Use this time to do some research on your three pairs. You should

eventually ask your AVA representative to add you to the twice-daily AVA

technical analysis newsletter. While it is usually only distributed to clients

with live accounts, if you establish a good rapport with your representative
                                    Page 21
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

and appear serious about wanting to trade Forex, something can

sometimes be worked out.

      The key thing to identify for each currency pair is the resistance point

and support point.

            Resistance Point: The highest value a currency reaches

             before dropping during a given time period.

             Support Point is the lowest value a currency reaches before

             appreciating. You should identify the weekly, monthly, and

             yearly resistance / support points for your pairs.

      After a week or so when you begin to be comfortable with the

platform, to start opening manual trades. We told you earlier to set up each

strategy in your portfolio to open trades with the smallest permissible lot,

which is 10,000 units. Once you are familiar with the platform and more

knowledgeable in your trading pairs, you can open some manual trades

with larger amounts. Feel free to have a little fun and open full lots of

100,000 currency units if you wish. The practice account allows valuable

trial-and error experience. Trading lot sizes you are unlikely to afford at first

will highlight valuable lessons on what not to do if you see them go sour.

While you can enter manual trades based on your own research and daily
                                    Page 22
                                              The Beresford Trade Guide to
                                               Maximum Advantage Forex

Forex reports, the Mirror Trader gives you the benefit of basing your

manual trades on what the strategies in your portfolio are doing as well.

You can employ the knowledge of support and breakout points you should

have researched over the past week(s). These points are crucial for

employing the ''breakout'' Forex strategy, which is gone over in depth in our

online article Winning Strategies: Breakout Points.

      For the purposes of this tutorial, we need only establish that you

should avoid opening buy positions when the currency pair is close (but not

beyond) it’s point of resistance, and the same with sell positions when a

currency is close to its support point. Once it has moved beyond, you will

surely see your signal provider’s jump all over the breakout. By combining

the knowledge and insights gained through your technical analysis and the

signal providers in your portfolio, you are twice as likely to catch a profitable


      Beware of being caught on the wrong side of a trade during a

breakout, as the currency pair will be shifting to a new paradigm in which it

is unlikely that your trade will turn around within weeks, if at all, before your

account is depleted. My bleakest ever day in Forex when I was on the

wrong side of a buy trade on the Euro when it plunged through it’s support
                                      Page 23
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

point while I was waiting for a pullback. In my rookie naiveté, I sought to

hold them until my hoped for pullback would allow me to at least minimize

my losses. The next day was saw no real change, but on the third, I saw

my losses double as the pair tumbled to 6 month low. While still praying for

a relief, I belatedly set stop points that would keep my other trades safe

from a margin call. The moral of the story is? Set your stop-losses early

and flee any trade on the wrong side of the breakout as you would a pack

of zombies gone berserk.

                           Playing the Strategies.

      The key to taking advantage of the signals is NOT to open manual

trades when the strategies in your portfolio are winning big. That is to say,

when you see a strategy buying the euro and they are already 200 pips in

profit, then that is A VERY RISKY TIME to enter a trade following them.

Since many major movements are followed by a pullback, long winning

streaks tend to have sharp drops shortly after. The thing to watch for is

when a strategy has opened a series of trades, and some are in profit while

others are still in the red. The winning positions indicate that the strategy is
                                    Page 24
                                            The Beresford Trade Guide to
                                             Maximum Advantage Forex

potentially catching a trend, while the losers tell you that this strategy will

most likely keep those positions open until the losers are in profit.

To open a manual trade, simply pull up the chart of the pair you wish to

trade. You will notice at the top-right corner there are two values, the value

on the left is the sell rate, and the value on the right is the buy rate. To open

a manual position, simply left click the value icon, enter the size of the lot

you want to open.

      If you are unable to monitor your trade, you should set stop-loss and

limit points, with which the system will automatically close your trades once

either of those points are reached. I typically set a very deep stop-loss

                                     Page 25
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

(about 50-80 for day-trades and 150-200 pips for over-nighters), as due to

the volatile nature of the Forex, big adverse swings can happen before a

position turns in your favor. I always set a limit for between 25-60 pips for a

short-term trade, and 50-150 for a position I plan to hold for a few days.

                              Ride The Trends

      A trader should only open one manual trade on a given currency pair

at a time. This limits your risk in a big way. As you have surely seen in your

auto-trades, being active in a winning trade can compensate for one doing

less-than-well. My method for opening new positions is what I like to call

                                    Page 26
                                             The Beresford Trade Guide to
                                              Maximum Advantage Forex

''Ride the trend''. While it is wise to open your manual trades while your

strategies are in the red, you should not initiate your second manual trade

until your first trade is comfortably in the green. A shown profit of 10-15 pips

is about the minimum you should look for. Your next trade should be a little

bigger than your first, as I consider the first trade to be a ‘’foot wetting’’

position, that is, a small value trade that you can close without shedding

tears if the market moves against you. The follow-up positions are your

potential money-makers. Don’t get emotions get to your head and bet more

than 5% of your equity on your bigger trades, no matter how good your

analysis is and how many strategies doing the same thing, this is a volatile

market littered with the corpses of trades who bought with their hearts

instead of their heads. If the trend continues up 10-20 pips more, that is a

solid sign to open a third position of a value between the first and second

position. Conservative traders can extend the profit gaps between positions

for increased hedging against drops.

                                     Page 27
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

Just Like This. The most recent position is displayed on top. ^

      The Fourth position generally should be as small as your initial one,

as your later trades become increasingly vulnerable to pullbacks on buy

positions or rallies on short positions ( in most cases, the market volatility

required to this kind of trade position takes up half of the trading day on a

relatively stable currency pair.

      Four simultaneous positions on a given currency pair is the limit, as

this strategy is designed to be emulated by traders with small investment

budgets as well. If you have a 5-figure or above trading budget, then to

take advantage of your capital (and comfortable equity cushion) simply

double or triple the lot sizes according to your risk appetite!

      Following my riding the trend strategy allows a trader to pull out with

some profits in case the market starts to move against him. For example, a

trader rides the trend and has four positions showing 100, 60, 40, and 20

                                    Page 28
                                             The Beresford Trade Guide to
                                              Maximum Advantage Forex

pips respectively, then the daily trend moves against him and the same

positions now show 60, 20, 0, and -20 pips respectively. Closing out at this

point, the trader can still close out and come out a winner because the

earned profits in your earlier trades provide a hedge against losses on the

later, more vulnerable trades

                       Micromanaging Your Manuals

      Remember that with manual trades, you cannot rely on a signal

provider to decide when to take profits or get out of trouble. Therefore,

setting your own stop/limit points is crucial. You can change your stop and

limit positions at any time while a trade is active. This is CRITICAL to

following the principle of ''let the profits run''. When a position is winning,

many traders are tempted to close and take the profit, only to wake up the

next morning to see that they missed out on a 100-pip movement in their

favor. For example, with winning trades, you should step in and set a stop-

loss that will preserve 50-75% of your profits, and set a limit of a further 50-

100 pips. This lets you maximize potential profits, whilst protecting some of

the gains you have already made. If you are building a hedge tree like that

described in our “ride the trend” strategy, the most conservative way to

employ stops on positive trades is to set them at the minimum of 10 pips
                                     Page 29
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

when the trades are still under, or less than 30 pips into profit. Once the top

trade hits stop loss, its generally a good signal to close the related trades

before they drop.

      Now what about managing losses? In the first place, if you are

opening manual positions under my ''Ride the Trend'' strategy, correctly by

setting 20-30 pip stop-losses on your initial “foot wetting” trades and

spacing your follow-up trades to protect against negative movements, it is

rare that you will ever lose a significant percentage of your equity trading

this way so long as you are being sensible (and doing your research).

When following auto-trading positions a trader should have noticed quite a

few of signal providers close positions with losses of 50, 100, even 200

basis points.

      Some of the signal providers are pure ''day traders'' and will always

close all of their positions, win or lose, when they are done for the day.

Additionally, any signal providers value having free equity more than

waiting for sour positions to turn around. That’s fine for six figure accounts

like theirs, but If your account is under 5 figures, closing out a three-figure

pip loss on a position closed by one of your subscribed strategies can take

a serious bite out of your capital. We do recommend setting a blanket stop
                                    Page 30
                                            The Beresford Trade Guide to
                                             Maximum Advantage Forex

loss for all subscribed strategies. You can do this by accessing the ‘modify

money management’ icon under the ‘portfolio’ tab on the left of the browser

window. You should set it very deep because many of these strategies take

a long view, so to avoid missing out on lots of profitable trades and

needlessly drawing down your account, set the stop-loss on your practice

account at least 150 pips. Since the purpose of the practice account is not

to turn the 100,000 imaginary dollars into 1,000,000 imaginary dollars but

to familiarize you with the systems and allow you to get acquainted with the

trading habits of as many different strategies as possible. Removing

strategies that make a habit out of closing at big losses consistently or

constantly hitting the deep stop we are willing to live with is just a

cancellation click away. For live account with limited equity, we recommend

only allowing 2 auto-positions with the deepest stops you can live with per

1,000 of equity, using only strategies with low max DD of 300 pips or less to

avoid consistent drawdowns.

      Holding negative positions that have not yet reached their stop points

for a considerable length of time does not have as many disadvantages as

you may think. The losses never actually affect your account balance until

you close the position, although it does affect your equity. As long as you
                                    Page 31
                                            The Beresford Trade Guide to
                                             Maximum Advantage Forex

do not have more than 30% of your equity tied up in active positions, you

can hold a couple of small positions that are marginally in the negative

indefinitely until they turn around. There is, however, a very small fee

charged for holding a trade overnight (about $.60), so after a week you may

be better off closing rather than holding that stubborn trade that won’t hit it

its stop or go into profit because you will have to start raising your limit-

points to break even. Resist the temptation to drop your stops. A trader is

most objective when OPENING the trade, once the position has reached

the point that he must either take the loss or lower his stop-loss, the trader

may be experiencing fear, stress, desperation even. All of these emotions

cloud judgment and can lead him to panicky, irrational decisions.

      Placing stop points on every manual trade protects traders from bull-

headedly holding losers that are quickly moving against them. As illustrated

by my near-death experience on the wrong side of a EUR/USD breakout,

the stop-loss points saved me from a margin call, which happens when

your free equity drops under 10% and all or your positions are

automatically closed. Since I had profitable positions simultaneously

active, escaping that quagmire allowed me to keep the positive positions

that softened the losses.
                                     Page 32
                                          The Beresford Trade Guide to
                                           Maximum Advantage Forex

                     Chapter 3: Tying it all together

     Now that you know the ins and outs of the platform, it is time to learn

how to use it as effectively as possible. In your practice account, you have

already added a dozen strategies on 3 pairs to your portfolio, and you have

successfully won some extra profits with higher-volume manual trades.

Now you will open a second practice account. Set up just like the one you

have been watching, except that on this one, you will not add more than 1

strategy for every $1000 you plan to invest once you’re ready. Add only the

ones you have seen consistently perform well and that fit the trading

frequency and Maximum Drawdown that you are comfortable with. If you

are not happy with the drawdowns that the providers sometimes incur, and

want rely ONLY on our method that we are about to reveal, then don’t

subscribe to ANY signal providers. From this point forward, you will open

your manual trades (even those inspired by strategies you do not subscribe

to on your second) as you ride the trends on your second practice account.

     You will keep both practice accounts open on different tabs while

                                   Page 33
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

trading, and you will open your manual trades on your new account. Four

business days before your original practice account expires, open another

one under another name with invalid contact info (I have done this over 200

times, there’s no limit, and AVA’s servers are more than capable enough to

handle it. It’s not against the law or AVA FX’s terms of service. Over 90% of

people who open a practice account do this ANYWAY!, so its not like we

are punking the new account openers either). While you may not see a

significant increase in profits in the second account, what you should

achieve by following our tactics as outlined above is tight money

management, low drawdowns, and a lot of profitable trades under the

“history” tab.

      When you open your live account (which you will do either through a

practice account you opened through Beresford Trade or via a direct link on because we’ve given you some of our trade secrets

for free on a silver platter), you will manage it exactly the way you have

operated your second practice account (or keep opening practice accounts

until you are confident: we are a no-rush, no pressure organization!).

Continue to open practice accounts so you can follow the open positions

over a dozen strategies on the main page of a practice account without
                                    Page 34
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

risking your actual cash. Do this until your account is large enough to safely

follow the strategies you like with minimum lots on your live account. While

is possible to follow strategies that are not in your portfolio through a single,

doing so requires you to open the strategies tab, search for the strategy,

and navigate to the appropriate tab on the strategy card. It’s much easier

and efficient to switch between tabs to view ALL of your signal provider’s

positions at once rather than tediously keep making trips back to the

strategy tab.

The key benefits of the Beresford Trade Method include:

Conservative Money Management for Your Live Account: You will have

plenty of equity free to ride the trends identified by your technical and

fundamental analysis as well as those identified by your signal providers

More Control: This method enables you to avoid having different strategies

open conflicting positions. Choose to trade as a short-term or long-term

trader as you see fit.

Intuitive and Easy to Master: Any seasoned Forex trader will tell agree that

in addition to analysis and sound trading systems, there is an art to Forex

trading that only comes from experience. Following the method described

above, traders benefit from at least 2 months of practice accounts where
                                    Page 35
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

even if they stumbled badly a few times, they didn’t losing their shirt as it

was all done with the digital equivalent of monopoly money.

Prolonged Strategy Testing: Traders following our technique would have

narrowed down their portfolio of signal providers on their active account

down to a select few that consistently show positive results at a level of risk

they are comfortable with.

      So that, in essence, is how we do it. No tricks, no complicated trading

systems, just solid research backed up by following dozens of profitable


      If you can only afford the $100 investment required to open a live AVA

Trade manual account rather than the $500-$1000 recommended for a

Mirror Trade account, it’s possible to take advantage of the signal providers

available through the Mirror Trader practice account you will keep opening.

Make sure to increase your margin to 400:1 because otherwise you will not

be able to practice ride the trend with such a small level of capital.

      That said, I strongly disapprove of continuing to milk a practice auto

account while trading on a manual one any longer than it takes to earn the

necessary capital to open a Mirror Trader account. The signal providers are

compensated by a small share of trade volume, and it is unethical to trade
                                    Page 36
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

on a platform they do not get compensated on. Therefore, if you choose to

follow my system this way, just stay on the right side of karma and open a

live Mirror Trader account as soon as you’ve earned the necessary capital

(Just make sure to open it from my site, as I’m the guy who gave you the


     To summarize, a successful Forex career using the Beresford Trade

system, you the trader should:

           Master 3 currency pairs Involving the US Dollar

           Maintain a Mirror trader practice account indefinitely even after

            you have opened a live trading facility

           Keep both accounts open while you are actively trading

           Let your profits run

           Don’t ever open a second position on a currency pair that does

            not conform the our ride the trends system

           Never invest more than 2-5% of your equity in a single trade

           Always keep 60%+ of your equity in reserve

           Never follow more than 1 low max DD auto-trading strategy per

            $1000 invested on a live account

Now that we have sketched a roadmap for, I don’t want you to think that
                                    Page 37
                                           The Beresford Trade Guide to
                                            Maximum Advantage Forex

this is all we have to offer. While prospective clients should appreciate that I

must devote a significant share of my available time to existing clients as I

don’t have a multinational 24-hour staff like AVA FX (Yet). You are in good

hands as the licensed AVA FX reps can guide you regarding what kind if

investment decisions are best for you. If you have any further questions, all

of my contact details are published on our website, and I do make a

reasonable effort to personally get back to every prospective client.

Good luck, and may your profits run long!

                                    Page 38
                                                               The Beresford Trade Guide to
                                                                Maximum Advantage Forex


Top Autotrading Strategies for EUR/USD, AUD/USD, GBP/USD, USD/CHF, and USD/JPY (Last Updated Nov. 26,
There are three screenshots per Pair, showing top ten strategies ranked by T-score, Max DD, and Profit in Pips.
Results are for the 30 days preceding last update. This appendix is updated monthly. You can evaluate ot her currency
pairs through online through your practice account.

                                        EUR/USD TopT-Score

                                       Best Max DD, EUR/USD

                                    EUR/USD, Top Pip Winners

                                                 Page 39
                 The Beresford Trade Guide to
                  Maximum Advantage Forex

 AUD/USD Top T-Score

 AUD/USD Best Max DD

AUD/USD Top Pip Winners
          Page 40
              The Beresford Trade Guide to
               Maximum Advantage Forex

   GBP/USD T-Score


GBP/USD Top Pip Winners
       Page 41
              The Beresford Trade Guide to
               Maximum Advantage Forex

USD/CHF Top T-Scores

       Page 42
              The Beresford Trade Guide to
               Maximum Advantage Forex

USD/CHF Top Pip Winners

 USD/JPY Top T-Scores

 USD/JPY Best Max DD
       Page 43
                   The Beresford Trade Guide to
                    Maximum Advantage Forex

    USD/JPY Top Pip Winners

           Page 44
              The Beresford Trade Guide to
               Maximum Advantage Forex
       Page 45

Shared By:
Charles Bown Charles Bown http://