TIMESTAMPS
00:58 – UTILITY
Trade execution is the essential element that transforms our trading strategy and trading plans into actionable positions, and ultimately determines our ability to achieve consistent profitability.
Trade executions allow us to shift from passive market observer to active market participant and seize trading opportunities.
By refining our execution skills, we enhance the likelihood of attaining our trading goals and achieving long term success in trading.
Establishing and following a structured set of guidelines for trade execution helps to maintain objectivity throughout the trading process.
Incorporating Order Flow analysis into trade execution aids in timing trades more effectively and entering or exiting positions with greater precision.
Order Flow analysis is particularly valuable for Scalping Strategies to capitalize on quick price movements and intraday trading opportunities.
02:14 – IMPLEMENTATION
Before entering a trade, it is important to assess the appropriate risk management and take profit strategies, while also being mindful of the specific entry type being employed.
Severin Scalping Strategy distinguishes between 3 different entry types that all have predefined specifications:
1) Aggressive entries
2) Reclaims / Losses
3) Backtests / Retests
Risk Management in trading involves implementing strategies and techniques that protect capital, limit potential losses, and optimize the risk to reward ratio, ultimately aiming to achieve long-term success.
Severin Scalping Strategy defines the following Risk Management rules:
> Risk per trade is <1% of that account
> Risk-to-Reward ratio of at least 2:1
> Decreasing position size by 50% after losing 2 trades in a row.
> Taking a break to refocus following a losing streak of 3 trades in a row.
Applying a Take Profit strategy allows traders to know what potential rewards to expect from a specific trade prior to execution, enhance trading efficiency, and ultimately enhance consistency in one's trading approach.
Severin Scalping Strategy defines the following Take Profit strategy:
> 3 Take Profits
Example ES (ticks): SL 12, TP1 20, TP2 25, TP3 30
Example NQ (ticks): SL 26, TP1 40, TP2 50, TP3 60
> TP strategy is always context dependent and subject to change.
> TP % depends on the local Market Structure
With the local trend: TP1 50%, TP2 25%, TP3 25%
Against the local trend: TP1 75%, TP2 15%, TP3 10%
> Upon seeing a red flag / sign of weakness after TP1, you can close your trade manually to lock in remaining profits.
Let’s examine the 3 entry types:
1) Aggressive entries
Includes classical SFP, as well as the first touch of predefined support or resistance, where we do not have to wait for a shift in MS or subsequent backtest/retest before entering.
Even with an aggressive entry, one must prioritize Order Flow evaluation and wait for confirmation to mitigate the risk of being caught on the wrong side of a strong move.
07:15 – EXAMPLE | AGGRESSIVE ENTRY EXPLANATION
★ By utilizing Order Flow, traders can initiate an aggressive trade upon the first touch of a level or SFP, seize the initial price movement while simultaneously protecting themselves from impulsive entries that lack confirmation and carry higher risks.
🎥 11:24 – EXAMPLE | AGGRESSIVE ENTRY RECORDING
2) Reclaims / Losses
This concept relates to an entry that can be employed when the initial price reaction has already been missed or when one prefers to wait for a significant level to be breached/lost. There are two distinct types of Reclaims and Losses
> Reclaim/Loss of Orders
> Reclaim/Loss of Levels
16:00 – EXAMPLE | LOSS OF ORDERS ENTRY
19:02 – EXAMPLE | RECLAIM OF LEVELS ENTRY
By trading Reclaim of Levels, traders can participate after a desired SOS, evidenced by reclaiming a significant reference level, or even participate when the initial reaction has been missed.
🎥 22:18 – EXAMPLE | RECLAIM ENTRY RECORDING
3) Backtests / Retests
Backtest or retest entries can be utilized to capture classical CCW retests or backtests of Volume Nodes.
We may apply these entries when the market experiences a significant impulsive move in either direction or when substantial volume is transacted at a specific reference point.
26:03 – EXAMPLE | BACKTEST / RETEST ENTRY
An assessment of the buying pressure in the retest candle and the open of the new 5-min candle are very important to judge if the retest of the high will fail or succeed. In this case, there was greater negative delta in the retest than there was positive delta in the initial push upwards.
🎥 29:30 – EXAMPLE | BACKTEST ENTRY RECORDING
🎥 32:52 – BONUS VIDEO
How to transform a Daily Plan into an actionable trade entry, using one of the predefined entry types.
50:47 – TIPS & TRICKS
★ Severin Scalping Strategy is designed to provide a structured framework to navigate the markets ever-changing dynamics and capitalize on trading opportunities effectively.
★ The only way for a trader to gain experience and become proficient is through actual trading.
★ The more information we have in our favour, the more comfortable we are with the execution of a trade, yet, it is important to find a balance and avoid hesitation during the entry process to not miss the opportunity.
★ This scalping strategy is considered advanced and due to its complexity and reliance on sound Order Flow analysis, it is recommended to start practicing on a demo account to gain experience and to overcome barriers such as fear and hesitancy.
★ Understanding your own strengths and weaknesses is crucial, as it allows you to optimize your performance by adapting to different market conditions.
★ A useful and highly recommended way to figure out strengths and weaknesses is using a trading journal.
★ It is recommended to always stick to one’s complete set of rules for trade entry criteria before entering a trade, rather than relying solely on Order Flow as the basis for your trade.
★ Flexibility is key in adjusting one’s bias when the market presents new data that contradicts the initial trading idea. It is recommended to promptly exit any trades if conflicting signals emerge after the first take profit is hit.