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Signal Pilot
Updated 2025-10-31 15 min read

Best Practices & Pro Tips

Signal Pilot indicators are used with these proven strategies from experienced traders. These guidelines are commonly followed for trading effectiveness.

🎯 Core Principles Beginner Friendly

1. Quality Over Quantity

Selective signal evaluation

❌ Lower quality approach: Trading all IGN signals regardless of context ✅ Higher quality approach: Focusing on IGN at major support with volume confirmation

Why: - Not all signals are equal - Confluence improves win rate dramatically - Fewer, better trades = better results

Minimum confluence checklist: - [ ] Signal (IGN/CAP/BDN) - [ ] Key level (Janus support/resistance) - [ ] Trend alignment (with HTF)

2. Higher Timeframes = Higher Quality

Start analysis on higher timeframes

Recommended workflow: 1. Daily can be checked for overall bias and major levels 2. 4H can be dropped to for intermediate structure 3. 1H or 4H can be executed on for swing trades 4. Or 15m-1H for day trades

Why: - Daily levels are strongest - HTF trends are more reliable - Lower timeframes are noisier - HTF context prevents counter-trend traps

Common guideline: Trading against Daily trend is generally avoided unless CHOCH is confirmed, as it's associated with lower probability setups.

3. Stop Loss Usage

Standard risk management practice in trading

Common stop loss placement patterns:

For long positions (IGN-based entries): - Typical placement: Below the IGN candle low - Alternative placement: Below nearest Janus support - Often using whichever level is closer/tighter

For short positions (BDN-based entries): - Typical placement: Above the BDN candle high - Alternative placement: Above nearest Janus resistance - Often using whichever level is closer/tighter

Common stop management guidelines: - Stops are typically set before position entry - Moving stops closer to entry increases original risk assessment - Trailing stops in favorable direction is common practice - Positions risking more than 2% of account are generally filtered out

4. Trade With the Trend

"Trend is your friend until the bend"

How to identify trend: 1. The Daily chart can be opened 2. Last 20-50 candles can be looked at 3. Higher highs + higher lows = Uptrend 4. Lower highs + lower lows = Downtrend 5. Mixed = Range (avoid or range-trade)

Educational examples for trend alignment: - Uptrend context: Many traders focus on IGN signals (aligned with trend) - Downtrend context: Many traders focus on BDN/CAP signals (aligned with trend) - Range context: Some traders observe bounces off support/resistance levels

When to counter-trend: - Only after CHOCH confirmation - Only with strong Pentarch signal at major level - Only if experienced trader

📊 Signal-Specific Best Practices

Pentarch Reversal Signals

TD (Touchdown)

Common usage patterns: - TD is typically used as an advance warning signal - Many traders watch for follow-up IGN before taking action - Often interpreted as "watch" rather than "entry"

Note: TD and IGN serve different functions—TD indicates early-cycle conditions while IGN indicates momentum breakout conditions.

IGN (Ignition)

Common usage patterns: - IGN is commonly used as a potential long entry signal - Many traders wait for candle close before evaluating - Often combined with nearby Janus support levels - Common stop placement: below IGN candle or support level

Higher-probability IGN scenarios: - At major Janus support levels - Following TD warning signals - With regime filter alignment (LOK) - In higher timeframe uptrends - With volume confirmation

Lower-probability IGN scenarios: - Far from support levels - Against higher timeframe downtrends - During low volatility periods - Near major resistance levels

WRN (Warning)

Common usage patterns: - Often used to adjust risk management - Many traders watch for CAP confirmation before exiting - Commonly seen as preparation signal rather than immediate action - Can appear multiple times during strong trends

Note: WRN indicates late-cycle conditions developing, but strong trends can sustain multiple WRN signals before actual exhaustion.

CAP (Climax)

Common usage patterns: - Often used as exit consideration for long positions - Many traders adjust stops or take profits - Can be used to watch for BDN confirmation for shorts

Higher-conviction CAP scenarios: - CAP at major resistance levels - Following extended price moves - Against higher timeframe downtrends - Multiple WRN/CAP signals in sequence

Lower-conviction CAP scenarios: - CAP mid-trend with room to run - Higher timeframe remains bullish - Significant support levels below current price

BDN (Breakdown)

Common usage patterns: - Commonly used as potential short entry signal - Often triggers long position exits - Common stop placement: above BDN candle or resistance

Higher-probability BDN scenarios: - At major Janus resistance levels - Following CAP/WRN warning signals - With regime filter alignment (SOK) - In higher timeframe downtrends - With volume confirmation

Lower-probability BDN scenarios: - Far from resistance levels - Against higher timeframe uptrends - During low volatility periods - Near major support levels

Janus Atlas Level Trading

Support Levels

Common usage patterns: - Support levels are often used as potential entry zones - Many traders wait for price to reach the level before evaluating - Commonly combined with Pentarch IGN signals at support - Multiple touches typically indicate stronger support

Support break scenarios: When price closes below support: - Former support often becomes resistance - Traders commonly watch for BDN confirmation signals - Catching exact bottoms can be challenging

Resistance Levels

Common usage patterns: - Resistance levels are often used as potential exit zones - Many traders watch for Pentarch CAP/BDN signals at resistance - Shorts are commonly considered at resistance in downtrends - Multiple rejections typically indicate stronger resistance

Resistance break scenarios: When price closes above resistance: - Former resistance often becomes support - Traders commonly watch for IGN confirmation signals - Pullbacks to broken resistance can provide entry opportunities

FVG (Fair Value Gaps)

Common usage patterns: - FVGs are often treated as potential support/resistance zones - Bullish FVGs commonly viewed as support areas - Bearish FVGs commonly viewed as resistance areas - Many traders combine FVGs with Pentarch signals

Typical FVG approach: 1. FVG can be identified on chart 2. Price return to FVG zone can be watched for 3. Pentarch signal confirmation can be looked for (e.g., IGN in bullish FVG) 4. Common stop placement: beyond the FVG 5. Common targets: Opposite FVG or next key level

Order Blocks (OB)

Common usage patterns: - Order blocks are commonly used as potential entry zones - Many traders wait for price to revisit the OB before evaluating - Often combined with Pentarch signals at the OB - Common stop placement: beyond the OB boundary - OBs typically considered invalid after price closes through them

Typical bullish OB scenario: - Price retraces to bullish OB zone - IGN signal appears in OB area - Potential long consideration - Common stop: below OB - Common target: Next resistance level

✅ Knowledge Check

Question: What is the #1 core principle in Signal Pilot best practices?

🎚️ Risk Management Essentials Advanced

Position Sizing

The 1-2% Rule

1% Rule (Conservative): - Risk maximum 1% of account per trade - Example: $10,000 account = $100 risk max

2% Rule (Aggressive): - Risk maximum 2% of account per trade - Example: $10,000 account = $200 risk max

Calculation: 

Position Size = (Account Size × Risk %) ÷ (Entry Price - Stop Price)

Example:
- Account: $10,000
- Risk: 1% = $100
- Entry: $50
- Stop: $48
- Risk per share: $2

Position Size = $100 ÷ $2 = 50 shares

Common practice: Most risk management frameworks recommend not exceeding 2% risk per trade.

Risk/Reward Ratios

Minimum 2:1 R/R

Calculation: 

R/R = (Target - Entry) / (Entry - Stop)

Example:
- Entry: $50
- Stop: $48 (risk $2)
- Target: $56 (reward $6)
- R/R = $6 / $2 = 3:1 ✅ Good

Example Lower R/R:
- Entry: $50
- Stop: $48 (risk $2)
- Target: $52 (reward $2)
- R/R = $2 / $2 = 1:1 ❌ Generally considered unfavorable

Common guidelines: - Many traders use minimum 2:1 R/R (risk $1 to potentially make $2) - 3:1 or better is often preferred - R/R less than 2:1 is typically filtered out - Janus levels are commonly used for target placement

Scaling In/Out

Scaling OUT (Taking Profits):

Method 1: Thirds - Common approach: Exit 1/3 at 2:1 R/R - Exit 1/3 at 4:1 R/R - Let 1/3 run to trail stop or opposite signal

Method 2: Half & Half - Common approach: Exit 50% at 2:1 R/R - Let 50% run to trail stop

Method 3: Full Exit - Some traders exit entire position at opposite signal - Simpler approach with less management

Scaling IN (Pyramiding):

⚠️ Advanced technique - more suitable for experienced traders

Common guidelines for pyramiding: - Typically only added to winning positions - Each new position often smaller than previous - Generally avoid averaging down (adding to losers) - Many traders move stops to breakeven after adding

📈 Workflow Optimization

Pre-Market Routine

Common pre-market activities:

  1. Higher timeframe analysis (Daily/Weekly)
  2. Marking major support/resistance zones
  3. Identifying overall trend direction

  4. Noting key levels for the session

  5. Setup scanning (Augury Grid or similar tools)

  6. Identifying which symbols have signals
  7. Finding symbols at key levels

  8. Checking alignment with HTF trend

  9. Opportunity prioritization

  10. Many traders focus on 3-5 best setups
  11. Confluence factors (signal + level + trend) commonly used

  12. Alert setting for potential entries

  13. Economic calendar review

  14. Noting major news events
  15. Many traders avoid trading 30min before/after major news
  16. Increased caution during high-impact data releases

During Trading Hours

Common active monitoring patterns:

  1. Alert watching
  2. Typically set to "Once Per Bar Close"
  3. Checking chart when alert fires

  4. Verifying setup remains valid

  5. Pre-entry confirmation

  6. Checking if signal is at key level
  7. Evaluating HTF support for direction
  8. Confirming R/R is at least 2:1

  9. Position size calculation

  10. Execution practices

  11. Stop loss typically set immediately after entry
  12. Target orders (optional depending on strategy)

  13. Trade logging for record-keeping

  14. Position monitoring

  15. Many traders check positions 2-3x per session
  16. Typically avoiding tick-by-tick watching
  17. Relying on predetermined stop levels

Post-Market Routine

Common post-market activities:

  1. Trade journaling
  2. Recording entry price, stop, target
  3. Documenting rationale (signal + confluence)
  4. Noting emotional state

  5. Capturing entry screenshots

  6. Performance review

  7. Calculating win rate
  8. Analyzing average R/R
  9. Identifying what worked

  10. Identifying what didn't work

  11. Next session planning

  12. Tracking open positions
  13. Noting upcoming key levels
  14. Setting alerts for potential setups

🧠 Psychological Best Practices Intermediate

Common Discipline Guidelines

  1. Stop loss usage - Trading without stops is generally considered high-risk
  2. Stop management - Moving stops toward entry increases risk; trailing in profit is more common
  3. Position sizing after losses - Increasing size after losses (revenge trading) often leads to larger losses
  4. Break patterns - Many traders take breaks after 2 losing trades to maintain clarity
  5. Emotional trading - Trading while angry, stressed, or tired is associated with poor decision-making

Common Psychological Traps

FOMO (Fear of Missing Out)

Pattern: Chasing signals after they've moved

Common approaches: - Waiting for next setup rather than chasing missed entries - Recognizing that opportunities are continuous - Looking for pullbacks or new setups instead of chasing

Overtrading

Pattern: Taking too many trades, accepting low-quality setups

Common approaches: - Some traders use daily/weekly trade limits (e.g., 5 trades per week) - Requiring minimum confluence factors (typically 2+) - Focusing on quality over quantity

Revenge Trading

Pattern: Attempting to recover losses immediately after losing trades

Common approaches: - Taking breaks after consecutive losses (often 2 in a day) - Reviewing what went wrong before continuing - Returning to trading with clearer mindset

Fear of Losing

Pattern: Exiting winners too early while letting losers run

Common approaches: - Using predetermined targets (often 2:1 R/R minimum) - Employing trailing stops on winning positions - Cutting losing positions at predetermined stop levels

📱 Technical Setup Optimization

Alert Management

Common practices:

  1. Alert frequency - "Once Per Bar Close" is standard to avoid spam
  2. Naming conventions - Clear names like "BTC 4H IGN Long" for easy identification
  3. Organization - Grouping alerts by timeframe for easier management
  4. Alert limits - Many traders keep 5-10 active alerts to avoid overwhelm
  5. Testing - Verifying alerts on lower timeframes before live use

Chart Organization

Common chart setup patterns:

  1. Indicator limits
  2. Many traders use maximum 3 indicators per chart
  3. More indicators can slow performance and create visual clutter

  4. Omnideck already combines multiple indicators

  5. Layout management

  6. Saving successful setups as templates

  7. Enabling quick switching between symbols

  8. Level visualization

  9. Major levels: Often marked with bright colors
  10. Minor levels: Typically dimmer colors or hidden

  11. Reduces visual noise

  12. Multi-timeframe monitoring

  13. Primary chart: Entry timeframe
  14. Secondary view: Higher timeframe for bias context

Watchlist Management

Common watchlist practices:

  1. Size management
  2. Many traders maintain 10-20 symbols
  3. Larger watchlists can lead to analysis paralysis

  4. Focusing on most active instruments

  5. Categorization

  6. Crypto majors
  7. Forex pairs
  8. Stock indices

  9. Individual stocks

  10. Dynamic rotation

  11. Removing low-volatility/ranging symbols
  12. Adding trending instruments

  13. Adapting to market conditions

  14. Augury Grid usage

  15. Scanning entire watchlist efficiently
  16. Focusing detailed analysis on active signals

🎓 Continuous Learning

Review Your Trades

Weekly review: - What's your win rate? - What's your average R/R? - Which setups work best? - Which timeframes are most profitable? - Any patterns in losses?

Monthly review: - Overall profitability - Best performing strategy - Worst performing strategy - Adjustments needed?

Keep Learning

Resources: - Trade journals (write down every trade) - Education portal (education.signalpilot.io) - Community feedback (if available) - Backtesting your setups - Paper trading new strategies

✅ Common Daily Preparation Elements

Typical pre-trading preparation checklist:

  • Daily/Weekly trend and level analysis
  • Identification of 3-5 potential setups
  • Alert configuration for potential entries
  • Economic calendar review for major news events
  • Position size calculations for planned trades
  • Mental preparation and focus assessment
  • Stop loss planning for entries
  • Trading journal setup for documentation

✅ Knowledge Check

Question: According to the Risk Management Essentials, what is the recommended maximum risk per trade?

🚫 Commonly Observed Mistakes

Patterns associated with poor trading outcomes:

  1. ❌ Trading without stops - significantly increases risk
  2. ❌ Moving stops closer to entry - reduces original risk assessment
  3. ❌ Averaging down on losing positions - compounds losses
  4. ❌ Overtrading - quality typically more important than quantity
  5. ❌ Trading against HTF trend (beginners) - lower probability setups
  6. ❌ Using all 7 indicators simultaneously - creates visual clutter and confusion
  7. ❌ Taking every signal without confluence - reduces win rate
  8. ❌ Chasing trades after initial move - often results in poor entries
  9. ❌ Emotion-based trading - associated with poor decision-making
  10. ❌ Risking more than 2% per trade - can lead to rapid account depletion
What You've Learned
  • Core Trading Principles: Prioritize quality over quantity in signal selection, maintain 1-2% risk per trade maximum, require HTF/LTF confluence before entry, always use stop losses (no exceptions), practice patience waiting for optimal setups
  • Pre-Market Preparation: Review HTF charts (Daily/Weekly) for bias and major levels, identify key Janus Atlas support/resistance zones, check upcoming economic calendar events, plan potential trades with pre-defined stop losses before market opens
  • Signal Selection Criteria: Only trade signals that appear AT key Janus Atlas levels (confluence), align with higher timeframe trend direction, offer minimum 2:1 risk/reward ratio, have clear invalidation points for stop placement
  • Risk Management Framework: Never risk more than 1-2% of account per trade, position size based on distance to stop loss (not arbitrary lot sizes), use wide stops at logical levels (not tight arbitrary stops), accept losses as cost of business without emotional attachment
  • Multi-Timeframe Analysis: Use Daily/Weekly for overall trend bias and major levels, use 4H/1H for entry timing and signal confirmation, avoid trading LTF signals against HTF trend (beginners), combine timeframes for confluence not contradiction
  • Indicator Combination Strategy: Start with Pentarch + Janus Atlas only (core setup), add ONE confirmation tool maximum (Harmonic Oscillator OR Volume Oracle), avoid loading all 7 indicators simultaneously (creates visual clutter and analysis paralysis)
  • Common Mistakes to Avoid: Trading without stops, moving stops closer after entry, averaging down on losing positions, overtrading without selectivity, chasing trades after initial move, emotion-based decisions, risking >2% per trade

Next Steps: Review Trading Workflow Guide for complete process details, or explore 7-Day Onboarding Checklist to build consistent habits.

Reflection Check

Before implementing these best practices, honestly assess:

  • Do you prioritize quality over quantity in your signal selection?
  • Are you following the 1-2% risk rule on every trade (no exceptions)?
  • Can you identify at least 3 commonly observed mistakes and how to avoid them?
  • Do you have a daily preparation routine that includes market review and stop loss planning?
  • Are you maintaining a trading journal to track your performance?

If yes to all 5: You're applying professional-level best practices! Continue refining your edge.
If no to any: Review the relevant sections above. Best practices aren't optional - they're what separate profitable traders from the rest. Start with Core Principles.

Trading readiness: These practices are commonly followed consistently for optimal results.