Top Traders: Strategies

TOP FTMO Trader Choon Chiat: Scalping strategy with very high win rate

In our new series of articles, we have a look at the strategies of our most successful FTMO Traders who have made interesting profits on FTMO Account or are able to deliver consistent results. In the first part, we will look at a strategy from a scalper from Malaysia.

Although he is a classic scalper who does not hold trades for more than a few dozen minutes, he is very consistent in his trading and does not overdo it with the number of trades at all. He executes only a few trades per day and as a result he has a very good win rate (around 70%) on his FTMO Accounts. As he says in an interview on our YouTube channel, you need to be very patient when opening a position. In fact, on a $100,000 FTMO Account, he was able to make a profit of around $10,000, which he managed to repeat several times.

Aimed at gold

Choon Chiat trades exclusively gold (XAUUSD), but before he started trading at FTMO, he also tried currency pairs, futures or stocks. Gold is particularly suited to his style because it is volatile enough, and especially during the New York session, to offer him enough opportunities for profitable trades. Gold CFDs are very cheap in terms of margin required compared to futures contracts and provide him with greater trading freedom due to the lack of expiry of contracts.

When making trading decisions, he primarily follows price action while using the Bollinger Bands indicator and the popular RSI oscillator. He is not interested in fundamentals at all, which is understandable given his style. He uses top-down analysis, but unlike regular traders who start on daily or weekly charts and continue on hourly and 30-minute charts, he starts just on the 30-minute chart and continues on the 5-minute.

Finding consolidation

Since Choon Chiat looks for short-term opportunities and has a clear Take Profit value, it is not important for him to look for strong trends. On the contrary, the best opportunities for his trading style are offered in the consolidation phase when the market moves sideways. Price is looking for direction and moving between support and resistance levels, which is the ideal time for a trader to look for suitable entry opportunities.

After finding the levels of local support and resistance, he looks for possible entries after a bounce from these levels. When his signal is also confirmed by Bollinger Bands and RSI (and possibly divergence with price), he enters the trade with a risk to reward ratio of 1:1. His main objective for the day is to make a profit of 200 pips.

While fast and strong trends may offer him higher profit potential, he also risks higher losses. Since the trader does not set SL and TP values for his trades (for which we certainly cannot commend him), rapid price movements may pose unnecessary risk to his trading style.

Since high trade success rate is a priority for him, it is important to choose suitable entries that offer the possibility to reach the mentioned 200 pips. If such an opportunity does not arise during the day, he may not trade. This is also why the number of his trades is relatively low, given his style, and he has rarely made more than 3 trades per day in his accounts. This results in an above average success rate of over 70%, and a high consistency score of over 80%.

Psychology is important

Choon Chiat is very aware of the influence of psychology on a trader's results. A trader's strategy can be as good as it is, but if a trader is not disciplined, he cannot be profitable. This is also why he believes it is important for a trader to trade on a Free Trial account for as short as possible. This is because during a Free Trial, the trader will never know how his psyche will react to the events in the real market. At the same time, he points out that strategy trying and testing should definitely not take place on the real market, for this the demo or Free Trial account is definitely more suitable.

Like most of the novice traders, Choon Chiat at the beginning of his trading career was looking for the "holy grail" that would guarantee him 100% success. However, he eventually discovered that without proper risk management, discipline and control of emotions, it is impossible to be successful in trading.

His own recipe for losing trades is to stop trading and try to distract himself, for example by playing games. This helps him avoid excessive trading, unnecessary gambling and revenge trading. He himself has experience with these bad habits of traders, and therefore also keeps the number of his trades per day to a minimum.

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