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In this interview, I sit down with veteran trader Charlie Burton to unpack the mindset and methods behind his long, resilient career. From early days learning covered calls to navigating futures and FX, Charlie’s story is brutally honest—he turned a small account into a big one, blew it up, then rebuilt it by dialing in risk and emotional control. You’ll hear why he still leans on moving averages for structure, how he avoids the “overconfidence trap,” and why shrinking your risk per trade is the fastest way to calm your nerves.
In this piece, you’ll quickly learn Charlie’s trader strategy for surviving wild markets: widen stops when the tape gets noisy, cut position size to desensitize your emotional highs and lows, and let the yearly P&L—not this week—be your compass. We’ll cover his top-down, multi-timeframe process, why targets can be dangerous if they warp your decisions, and how to adapt when headlines flip the intraday narrative. By the end, you’ll have a simple, durable playbook you can apply immediately—especially if you’ve ever tightened a stop too soon or chased after a “must-hit” monthly target.
Charlie Burton Playbook & Strategy: How He Actually Trades
Core Market Framework
Here’s the big picture behind how Charlie Burton approaches the market day to day. The goal is simple: trade only when structure, momentum, and volatility line up—then control risk so one loss never matters.
- Focus instruments: major FX pairs and index futures; only 4–6 primary tickers on the daily watchlist.
- Trading windows: London opens early U.S. session; avoid the last 30 minutes before major data prints.
- Directional bias set from higher timeframes (D1/4H); execution on 1H/15M depending on volatility.
- Skip range-bound days: if average true range (ATR 14) is < 70% of its 3-month median, reduce size by 50% or stand aside.
Setups That Pay (Structure + Momentum)
We’re looking for clean structure with momentum confirmation, not random candlesticks. If the structure isn’t obvious at a glance, it’s not a trade.
- Trend filter: price above rising 50 EMA and 200 EMA for longs; below both for shorts.
- Pullback zone: enter on a retrace to the 20–50 EMA band with a rejection wick or inside bar break.
- Momentum check: RSI(14) > 55 for longs, < 45 for shorts; or MACD histogram aligned with trend on the execution timeframe.
- Location matters: prefer entries near prior day high/low, weekly pivot, or clean swing level—no mid-air entries.
Risk First, Always
Survival beats perfection. Keep risk tiny so execution stays calm and repeatable.
- Fixed fractional risk: 0.25%–0.75% max per trade; cap daily risk at 1.5%.
- If two losses occur back-to-back, cut size by 50% for the next two trades or stop for the day—no exceptions.
- Hard stop must be in the book at entry; no “mental stops.”
- Slippage buffer: add 0.1R cushion on fast markets or during news hours.
Stop Placement & Sizing
Stops protect the plan. Place them where the setup is proven wrong, not where it “feels” safe.
- For pullbacks, the stop goes beyond the swing extreme plus spread/1–2 ticks.
- For breakouts: initial stop = 0.8× ATR(14) on the execution timeframe or below the base.
- Position size = (Account Risk $) / (Stop distance $); round down to nearest standardized lot/contract.
- If stop < 0.4× ATR, widen to 0.5–0.8× ATR and reduce size so the $ risk is unchanged.
Entries That Reduce Stress
Entries are designed to avoid chasing and to keep the R multiple clean.
- Primary entry: limit order in the EMA zone with the trend filter satisfied.
- Secondary entry: break of the inside bar/high-tight flag with a 15M close confirmation.
- No entry if candle body > 1.5× ATR(14) of the entry timeframe—likely exhaustion.
- Only one retry per idea; if the level breaks twice, the read is wrong.
Trade Management & Exits
Let winners breathe; manage risk without strangling the trade. The process—not hope—decides exits.
- Partial at +1R: take 30% off, move stop to breakeven only after a higher low/ lower high forms in your favor.
- Trail with structure: stop goes under/over the last swing or 20 EMA once price advances >1.5R.
- Time stop: if the price goes nowhere after 8–12 bars, cut to free up capital.
- Final exit targets: prior day high/low, session VWAP deviation bands, or 2.5–3.5R—whichever comes first.
Volatility & News Adaptation
Different tapes demand different risks. Volatility tells you when to push and when to coast.
- On high-vol days (ATR > 120% of 3-month median): use half size, wider stops (0.8–1.2× ATR), and scale out faster.
- On low-vol days: use smaller initial targets (1.5–2R) and avoid late-session trades.
- 15 minutes before tier-1 data: no new entries; flatten if the stop would likely be swept by the print.
- If the spread widens beyond your plan’s average by 50%+, cancel pending orders.
Multi-Timeframe Alignment
Top-down keeps you from fighting the bigger wave. Higher timeframes define bias; lower timeframes execute with precision.
- Daily chart sets bias; 4H confirms trend strength via EMA slope and swing structure.
- 1H generates the setup; 15M triggers the entry pattern (inside bar/flag/pullback wick).
- No trade if D1 and 4H disagree; wait for alignment or trade smaller with quicker exit rules.
- Weekly levels override intraday noise—respect them for targets and risk placement.
Scaling, Pyramiding & Skipping
More is not always better. Only add risk when the market proves you right.
- Add once per 1R gained, never increasing total % risk on the day.
- Each add must have its own stop below the new structure; move the prior stop to lock at least +0.5R on core.
- Maximum adds per trend leg: two. If tempted to add a third bank and wait for the next cycle.
- Skip adding if news is due within 60 minutes or if RSI shows clear divergence against your position.
A.M. Prep & Watchlist
Routine beats talent when the market opens. Prep builds conviction and keeps you selective.
- Pre-market (30–45 min): mark yesterday’s high/low, overnight high/low, weekly pivots, and clean swing zones.
- Note ATR context and session trend from London open; decide push/stand-down mode before first trade.
- Build a ranked watchlist (top 3 only) based on confluence: trend + level + momentum.
- Define “no-trade” conditions (e.g., overlapping MAs, center-of-range, sloppy wicks) to avoid boredom trades.
Psychology: Narrow Emotional Range
Calm execution is a position. Reduce the amplitude of wins and losses to think clearly.
- Standardize risk so a loss barely moves the daily P&L; if not, your size is too big.
- After any >2R loss, take a 20-minute break—no chart watching.
- Don’t set monthly dollar targets; set process targets (e.g., “take only A-setups for 10 sessions”).
- If you feel the need to “make it back,” close the platform for the day.
Journal & Metrics That Matter
Data beats memory. Track what truly drives edge so you can scale the right behaviors.
- Record per trade: setup tag, timeframe, ATR regime, R multiple, add-ons, rule deviations.
- Weekly review: cut the bottom 20% of setup tags by expectancy; double down on top tags.
- Expectancy filter: if a setup’s 20-trade rolling expectancy < +0.2R, pause it and revise rules.
- Screenshot pre- and post-trade; annotate the reason for entry/exit in one sentence each.
Example Day Plan (Template)
A simple, repeatable flow keeps you in rhythm and makes results less random.
- 07:30: Mark levels, confirm bias (D1/4H), pick top 3 tickers.
- 08:00–10:30: Look for pullback entries into EMA band with momentum aligned; one retry max.
- 11:00: If flat and ATR is low, reduce expectations and target 1.5–2R; otherwise, stand aside.
- 13:30+: No new trades unless A-setup with clean catalyst; protect morning gains by halving size.
Size Risk: Small to Stay Calm and Execute Cleanly
Charlie Burton keeps his edge by sizing trades so small that a normal loss barely dents his emotions. When the risk per trade is tiny, execution gets cleaner—no second-guessing, no flinching at noise, no revenge entries. He’ll tell you that discipline is easier when your P&L isn’t screaming at you; small risk turns big decisions into routine clicks. With a smaller size, you can follow your plan through a losing streak without blowing up your month.
Small risk also buys you time to let trades work. It keeps stopping where the setup is actually invalidated, not where your nerves give out. Charlie Burton treats the day’s risk budget like a sacred ceiling, cutting size or stopping entirely once it’s reached. That way, your calm stays intact, your read stays sharp, and your execution remains consistent—because your account and your headspace are both protected.
Trade the Structure, Not Your Forecast — Mechanics Over Prediction
Charlie Burton builds trades from what the chart is doing, not from what he thinks it should do. He waits for structure to confirm—trend, pullback, level—then executes the same mechanical steps every time. If the price doesn’t meet the criteria, there is no trade, no matter how persuasive the narrative sounds. This keeps him out of the “just one more guess” spiral that wrecks consistency.
Mechanics also decide his exits. Charlie Burton trails behind a swing structure or a chosen moving average instead of guessing tops and bottoms. When structure breaks, he’s out—even if his opinion still says the move has “more left.” The market gets to be right; the trader gets to be systematic. By letting structure and rules settle the argument, he converts uncertainty into a repeatable process.
Let Volatility Set Stops, Targets, and Position Size Automatically
Charlie Burton treats volatility as the metronome of the entire trade—if it’s fast, he gives the market space; if it’s slow, he dials expectations down. He sizes positions off the true stop distance so one loss equals a small, fixed slice of equity regardless of ATR. Wider ranges mean smaller size and looser stops, preventing death by noise. Tighter ranges mean modest targets and quicker profit-taking, because the tape simply won’t pay big R multiples every day.
Volatility also dictates where Charlie Burton places targets and how he manages the trail. On high-vol days, he scales out earlier to bank R while letting a runner breathe behind structure or a moving average. On a dull session, he accepts that 1.5–2R is a great trade and closes without FOMO. By letting volatility set the boundaries, he avoids forcing trades to fit a mood and keeps risk steady even when the market mood swings.
Diversify by Instrument, Setup, and Timeframe to Smooth Equity Curve
Charlie Burton spreads risk across a small basket of liquid markets so no single instrument dictates his month. He rotates attention to the pairs or indices offering the cleanest structure instead of forcing trades on a favorite ticker. He also diversifies by setup—trend pullbacks, inside-bar breaks, and occasional range fades—so the edge isn’t tied to a single market condition. This mix reduces correlation between outcomes and steadies the P&L when one playbook goes cold.
Timeframe diversification is the final buffer. Charlie Burton aligns bias on the daily/4H, executes on the 1H/15M, and occasionally harvests quick scalps when conditions support it. If higher timeframes stall, he steps down in size and timeframe for tactical wins without violating the broader risk cap. By diversifying where, how, and when he engages, he keeps the equity curve climbing with fewer potholes—and his mindset calm enough to follow the plan.
Rules First: Predefine Entries, Exits, and Daily Loss Limits
Charlie Burton runs on written rules, so the market can’t push him around. Before the session starts, he defines the exact trigger for entry, the invalidation level for the stop, and at least one objective take-profit. If the trigger doesn’t print, there is no trade—no “almost” or “close enough.” He also sets a hard daily loss limit so a rough morning can’t snowball into a ruined week.
During the trade, rules decide everything. Move the stop only for structural reasons, never emotion; trail behind swings or a chosen moving average after +1R, not before. If a rule is broken, log it immediately and stop trading for the session to protect discipline. Charlie Burton treats any deviation as a data point to fix, not a habit to excuse. The result is consistency you can scale—because every action has a reason written down before the bell.
In the end, Charlie Burton’s edge isn’t a magic indicator—it’s the discipline to make small, boring decisions that compound. Size risk so a single loss barely registers, then let structure—not opinions—do the heavy lifting. Volatility sets your distances and expectations: widen stops and trim size when the tape is wild; accept modest targets when it’s sleepy. Diversify by instrument, setup, and timeframe so no single market or playbook controls your mood or your month. And above it all, write rules for entry, exit, and a hard daily loss limit so your process stays intact when emotions try to take the wheel.
Charlie Burton’s playbook thrives on repeatability. Prep levels, confirm bias top-down, execute only when criteria align, and manage trades with predefined actions instead of hope. Journal every decision, tag each setup, and prune what doesn’t pay so your best patterns get more shots. Protect your headspace with a narrow emotional range and stop trading when the daily cap is hit. Do this consistently, and your equity curve starts to look like his philosophy—steadier, calmer, and built to last.
