Hello there, in this chapter, we’ll talk about why the system is called horizon. When you hear the word horizon, you’re likely thinking of the place where the sky meets the earth. If you imagine how the that looks and then draw an analogy with the financial markets, then a horizon is a straight line, which is reminiscent on a level, and in the Horizon trading system, levels are exactly what the whole thing is built on.
Trading with levels has a wide range of advantages,
1) Levels let you use a comprehensive stop loss, since you know exactly where a trend falls apart
2) You also know where is the best place for a take profit, for the same reason
3) It lets you use shortstops, which wildly skews the risk reward ratio in you favor.
As an example, let’s see my deals right here
First, EURUSD, we’ll start with D1. We have a very important level at 1.14150. The price bounced off it a few times very sharply, after which we see an approach to it
(h4) then there’s a false breakout, which is a horizon system pattern, and that’s our entry point.
But more importantly, with a stop loss of 800 pips (above the local maximum), the TP was 6000 on one order, and 6500 on the other, which make the average Risk/reward here 1 to 8. That means that if make deals like this, if only 2 out of 8 deals are closed in profit, you still make money in the long run. Ask you self, how hard can it be to close 2 deals out of 8 with a profit? Not at all, I should think.
Next up is WTI Oil. Here’s that infamous place in the end of April, where that may future contract fell over and it’s prices where in negative numbers, which obviously also had bearing the spot market, and we can see where at 10 USD/Barrel we’ve had a very strong level form
After which the price approached the level again and another of our horizon patterns formed
After the pattern, I entered the market and, again, take note how the stop loss is less than 40pips, while the first tp was 878, so risk/reward was 1 to 20. Second tp was 1400 so r/r here was around 1 to 33.
I’m in a deal at the moment 1600 pips in profit, which makes r/r 1 to 40, which make the average for these entries around 1 to 30. This is more extraordinary than average, but you could definitely rely on 1 to 8 or 1 to 10 ratios.
Let’s sum up. Horizon is the ability to use shortstops, which gives you good risk reward ratios, which is certainly a positive, furthermore, since it’s build on levels, we always have a place for a take profit, which is the closest level to the price. Also, it’s universal, as you may have noticed, this wasn’t just forex, but also oil, and apart from that, you can do any timeframe as well, if you look at the oil deal, the orders were opened on m15, and on EURUSD we used H4 – so the working timeframe is whatever you prefer
Thanks for reading and have a nice day.