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In this interview, veteran Australian trader Chris Tate breaks down how he thinks about markets, risk, and time. He’s speaking as a career pro who has seen multiple cycles from Melbourne, and his calm, no-hype approach is exactly what newer traders need. Chris matters because he’s built a durable process around simple tools (support/resistance, breakouts) and the discipline to sit on his hands when nothing lines up—proof that you don’t have to trade all day to trade like a pro.
Here’s what you’ll learn in this piece: why the market is not the economy, how to identify and ride long-term trends, and how proper money management and realistic expectations keep you in the game. Chris Tate explains why fewer, bigger trades can beat constant screen-watching, how journaling builds self-control, and why isolation from noisy opinions improves decision-making. You’ll come away with a clear playbook for spotting trend shifts, managing drawdowns without panic, and building a strategy you can actually stick to.
Chris Tate Playbook & Strategy: How He Actually Trades
Core Philosophy: Trend First, Ego Last
Chris keeps it simple: trade with the dominant trend and let statistics do the heavy lifting. He avoids prediction and focuses on rules that are easy to execute under pressure. The aim is fewer, higher-quality trades with tight risk and plenty of patience.
- Trade only in the direction of the prevailing trend; never counter-trend without a written exception.
- If the setup isn’t obvious at a glance, skip it—clarity beats cleverness.
- Commit to mechanical rules; no “feels,” no discretionary overrides after entry.
- Accept randomness: judge yourself by process quality, not the outcome of individual trades.
Markets & Timeframes: Wide Net, Calm Pace
He scans liquid equities, indices, and major FX/CFD contracts, then narrows to instruments with clean, persistent trends. Timeframes are chosen to reduce noise and decision fatigue. Daily charts do the heavy lifting; lower timeframes only confirm structure, not trigger fear.
- Primary timeframe: Daily for entries/exits; Weekly for trend context; Intraday only for execution.
- Minimum liquidity: average daily turnover that allows full entry/exit with <0.10% slippage.
- If weekly and daily trends disagree, default to the higher timeframe or stand aside.
- Keep a universe list and rescreen weekly; add/remove symbols based on trend quality.
Entry Triggers: Breakouts, Not Bottom-Picking
Chris favors objective continuation signals. He’d rather “buy high and sell higher” than guess bottoms. Breakouts and pullbacks into strength do the job without a narrative.
- Longs: Enter on a 20- to 55-day breakout of the closing price with above-average range.
- Shorts: Mirror rule using downside breakouts; avoid when broad market uptrends are dominant.
- Optional pullback filter: After a breakout, buy the first higher low that holds above the 10-day EMA.
- No trade if the breakout bar’s true range >2× ATR(14) and pushes risk beyond limits.
Risk & Position Sizing: Small Bite, Big Longevity
Staying in the game beats being “right.” Chris sizes positions off volatility so that one trade never matters. He caps total risk across the portfolio to stay emotionally neutral.
- Risk per trade (R): 0.5%–1.0% of account equity, never more.
- Position size = R / stop distance; stop distance = max(1.5×ATR(14), structural swing level).
- Portfolio heat cap: total open risk ≤ 5% of equity; if exceeded, reduce the newest positions first.
- If slippage widens, stop distance at execution, auto-reduce size to keep R constant.
Initial Stops: Objective, Pre-Committed
Stops go in at the entry and never move farther away. They live where the trade thesis is invalidated by price, not opinion. Volatility anchors keep you from hugging the price too tightly.
- For longs: Initial stop = lowest of (prior swing low, 2×ATR(14) below entry, last base midpoint).
- For shorts: Initial stop = highest of (prior swing high, 2×ATR(14) above entry, last base midpoint).
- If the initial stop requires >1% risk, either reduce size or skip the trade.
- No widening stops post-entry—only tighten or exit.
Trade Management: Rules That Ride Trends
Once in, Chris lets trends breathe. He avoids forcing profits and uses trailing logic that rewards persistence. Pyramiding is allowed, but only when the trade has proved itself.
- Trail with a 10-/20-day channel or 2×ATR(14) stop—whichever is farther from price.
- Move stop to breakeven only after price closes ≥1×ATR(14) in favor and structure confirms.
- Pyramid a winner at +1R and +3R with half the original size; each add must raise the average stop so total heat stays ≤ original R.
- Never add to a loser. Ever.
Exits: Clean, Quick, and Final
Exits are where discipline pays. Chris accepts that you’ll never sell the exact top; the goal is to capture the meat of the move without second-guessing.
- Hard exit on trailing stop breach at the close; avoid intraday noise unless a gap invalidates risk.
- Time exit: if price stalls and the 10-day EMA crosses back against your direction, exit partially; full exit if trend structure breaks on the daily close.
- If two consecutive adds fail to extend the trend (no new equity highs), stop new adds and tighten the trail.
- Record the exit reason (rule ID) immediately after the trade—no post-hoc stories.
Playbook for Setups: From Scan to Order
A consistent pre-trade checklist prevents impulsive entries. Chris treats every trade like a repeatable production process, not a one-off bet.
- Confirm weekly trend, then daily breakout/pullback alignment (trend > trigger > risk).
- Check earnings/news windows on equities; avoid fresh catalysts within 3 trading days.
- Verify position size, stop, and portfolio heat before sending any order.
- Place bracket orders (entry, stop, limit add levels) at the same time to remove hesitation.
Psychology & Process: Boring Is Profitable
He engineers boredom on purpose. The routine is designed so that emotions have nowhere to attach. You don’t need motivation when you have guardrails.
- Daily routine (≤30 minutes): review open positions, adjust stops per rule, scan alerts, walk away.
- Weekly routine (60–90 minutes): refresh watchlist, sector/asset relative strength, and risk budget.
- Journal after every decision: what rule fired, what changed, what you felt—keep it factual.
- If you’re itching to trade, raise your entry thresholds (e.g., require wider breakout or tighter base).
Performance & Review: Stats Over Stories
Chris runs the system like a business: measure, adapt, and remove what doesn’t carry its weight. Reviews focus on rules and distributions, not single trades.
- Track expectancy = win% × avg win − (loss% × avg loss); target positive expectancy with win% 30–45% and avg win ≥ 2× avg loss.
- Monthly: prune the bottom 10% of setups by expectancy; re-allocate risk to top performers.
- Quarter-end: stress-test with 20% volatility shock to confirm sizing and heat caps are robust.
- If the equity curve dips below the 100-day moving average of equity, auto-cut per-trade risk by 50% until recovery.
Practical Filters: Keep Only the Clean Trends
Not all trends are tradable. He applies simple structural filters to avoid messy ranges and crowded trades that chew up capital.
- Require at least 6–8 higher lows (for longs) or lower highs (for shorts) in the last 12 weeks.
- Reject patterns with overlapping bars and expanding wicks—range markets eat stops.
- Favor symbols making 6-month relative-strength highs versus their sector or asset class.
- Skip trades where the average gap size exceeds 1.25× ATR; too jumpy for tight risk control.
Capital Allocation: Let Winners Pay the Bills
Capital shifts toward instruments and setups that actually make money. This keeps the edge concentrated and drawdowns contained.
- Split risk across 3–6 uncorrelated instruments; avoid stacking trades in the same theme.
- Increase risk on systems with a 12-month Sharpe > 1.0 by 25% (within heat limits).
- Reduce or pause systems after three consecutive rule-based losses if MFE/MAE deteriorates.
- Rebalance weekly to keep any single instrument at ≤30% of total open risk.
Execution Details: Friction Matters
Small edges compound when slippage and fees are controlled. Chris treats execution quality as part of the strategy, not an afterthought.
- Use limit-at-market-open or stop-limit entries to bound slippage on breakouts.
- Avoid entries during the first 5–10 minutes after the cash open on equities; let spreads normalize.
- Route orders to venues with consistent fills; if average slippage >0.15× ATR, reconsider the market.
- Always confirm borrow/short availability before short entries; no borrow, no trade.
Contingencies: When Markets Misbehave
Plans for rough patches keep you calm. You’ll cycle through volatility regimes—your rules should too.
- In volatility spikes (ATR > 1.5× its 3-month median), cut position sizes by 30–50%.
- In choppy regimes (RSI swings 40–60 for 4+ weeks), switch to only the highest-quality 55-day breakouts.
- After a gap through your stop, accept the market order exit on the next print; don’t negotiate with losses.
- If correlations jump above 0.7 across your book, close the weakest trades to lower systemic risk.
Maintenance & Upgrades: Change by Rule, Not Impulse
Improvements are scheduled and tested, never jammed in mid-drawdown. Chris only upgrades what he can measure.
- Batch changes monthly; never modify rules after a win/loss streak.
- Add a new filter only if it improves expectancy and reduces time-in-drawdown in a rolling 12-month test.
- Sunset indicators that duplicate information (e.g., moving average + similar channel).
- Keep the written playbook versioned; every rule has an ID, purpose, and test note.
Size Small, Survive Longer: Risk One Percent or Less
Chris Tate hammers this home: tiny risk keeps you calm and keeps you in the game. When every trade is capped at around one percent—or even half a percent—you stop caring about any single outcome and start caring about the process. That’s the mindset shift that lets you take the next signal without fear or revenge. Small sizing is the cheapest insurance you can buy against strings of losses, fat-finger errors, and surprise gaps.
In practice, Chris frames each trade in “R,” a fixed slice of account equity you’re prepared to lose if the stop is hit. Decide R first, then let the stop distance tell you the position size—wider stops mean smaller size, tighter stops mean bigger size, but R never changes. If markets get jumpy or you’re off your game, cut R in half and keep trading the plan. The goal isn’t to be a hero on one trade; it’s to make it boring enough that your edge has time to compound.
Let Trends Pay You: Trade Breakouts, Not Bottoms or Tops
Chris Tate’s rule is simple: let price prove itself before you touch it. He’d rather “buy high and sell higher” than waste capital guessing reversals. That means waiting for a clean breakout from a well-defined range, with the daily and weekly trends pointing the same way. When momentum carries you into the move, you’re hitching a ride on strength instead of wrestling with a falling knife.
In practice, Chris Tate treats the breakout close as the trigger and immediately parks a stop where the trend idea is wrong—below the base for longs, above it for shorts, often buffered by ATR. If the breakout bar is wild and bloats risk, he stands down and waits for the first orderly pullback that holds above the breakout level. Once in, he trails the stop systematically so winners breathe and losers exit fast. The edge isn’t calling the turn; it’s stacking small, rule-based entries into established trends and letting the market do the heavy lifting.
Allocate by Volatility, Cap Portfolio Heat, Avoid Correlated Bets
Chris Tate sizes positions by volatility so risk stays constant across wildly different markets. Instead of equal dollars per trade, he calibrates size to ATR or recent range, so a choppy instrument gets a smaller bite. That was a single outlier bar can’t hijack your equity curve. The result is smoother swings and a portfolio that behaves like a system, not a grab bag.
He also caps “portfolio heat,” the sum of risk across all open trades, so a hot streak doesn’t quietly overexpose him. When total open risk hits his preset ceiling, new signals wait, or position sizes are cut back. Correlation gets the same respect: if several charts are on the same theme, he picks the cleanest one and bins the rest. If correlations spike mid-trade, he keeps the strongest trend and trims weaker twins to drop systemic risk. In Chris Tate’s words and practice, volatility-based allocation plus heat limits let winners compound without letting one nasty day wreck the month.
Mechanics Over Opinions: Predefine Stops, Trail Winners, Never Average Down
Chris Tate runs on mechanics, not opinions. Before entry, he defines the stop where the trade idea is invalidated by price, not feelings. He uses a structure or a volatility buffer to place it and never moves it further once the trade is live. Orders go in as OCO, so the plan survives nerves and screens.
After entry, Chris Tate trails the winners methodically so profits are protected without choking the trend. A common rule is to shift to breakeven only after the price closes at least one ATR in favor and the structure confirms. Then a channel or ATR-based trailing stop takes over, ratcheting up on higher lows or down on lower highs for shorts. He never averages down; if the stop is hit, the thesis is wrong, and capital rotates to the next setup. Every exit is tagged with a rule code in the journal to reinforce discipline and make review measurable.
Build Boring Discipline: Fixed Routines, Journal Rules, Review Expectancy Monthly
Chris Tate treats trading like a factory shift: same checklist, same hours, same decisions. He runs quick daily reviews to adjust stops, scan alerts, and then steps away to avoid fiddling. Every action goes in a journal with the rule that triggered it, so patterns show up in black and white. The boredom is the feature—routine keeps emotions from rewriting the plan mid-week.
Expectancy is his scoreboard, not P&L snapshots. Chris Tate tracks win rate, average win, and average loss, and he cuts risk if the equity curve dips below its moving average. Weekly, he prunes low-expectancy setups and reallocates risk to what’s actually paying. The meta-rule is simple: if it can’t be measured, it can’t be trusted—and if it can’t be repeated on Tuesday, it’s not part of the strategy.
Chris Tate’s message is disarmingly simple and relentlessly practical: trade trends, size small, and let rules—not opinions—do the driving. He separates markets from the economy, reminding us that price is just an aggregation of expectations and can move independently of “fundamentals.” That’s why he buys strength instead of guessing bottoms, uses weekly and daily context to avoid myopia, and treats every decision as a pre-programmed step rather than a vibe. The result is fewer, cleaner trades that ride the move instead of wrestling it.
Risk and execution are where his edge compounds. Chris Tate fixes risk in “R,” sizes by volatility so no single instrument can hijack the equity curve, and caps portfolio heat to stay emotionally neutral. Stops are defined at entry and never widened; trailing exits harvest the bulk of the trend without hunting tops. He journals by rule code, reviews expectancy instead of stories, prunes what underperforms, and shields himself from social-media noise that tempts people to trade someone else’s plan. If you adopt his playbook—trend first, tiny risk, mechanical management—you get a process sturdy enough to survive shocks, boredom, and the inevitable losing streaks while giving winners the time and space to pay you.
