Table of Contents
Karen Foo sits down for a candid interview about how she went from struggling beginner to profitable forex trader and global speaker. Recorded on the Desire To Trade podcast, this conversation spotlights Karen’s Singapore roots, her preference for the London session, and the grind behind her results—less beach-laptop fantasy, more deliberate practice, journaling, and simplifying what actually works. She’s refreshingly honest about blowing accounts early on, then rebuilding with risk control and a calmer mindset.
In this piece, you’ll learn Karen Foo’s core playbook: why psychology and risk management come before system-hopping, how she blends day and swing trading on hourly/4H with a light touch of fundamentals, and the routines that keep her consistent. We’ll unpack her step-by-step approach to deliberate practice, trading journals that actually improve performance, and discipline tactics for handling losing streaks without revenge trades—clear, practical takeaways you can put to work on your next chart.
Karen Foo Playbook & Strategy: How She Actually Trades
Markets, Timeframes, and Session Focus
Here’s the foundation: what Karen watches, when she trades, and the charts she actually uses. Getting these basics right reduces noise and keeps you from forcing trades outside your edge.
- Trade focus: major FX pairs (EUR/USD, GBP/USD, USD/JPY) plus one or two “bench” pairs for backups.
- Primary timeframes: H4 for bias, H1 for setup, M15 for execution; no entries below M15.
- Session window: London open through first 2–3 hours; avoid late NY drift unless a clean trend is active.
- Maximum open symbols at once: 2 correlated pairs count as one risk unit.
Market Structure First: Bias and Areas of Interest
Before signals, she frames the market with a simple structure so the plan isn’t built on noise. This gives you a directional lean and a map for where trades make sense.
- Mark the weekly swing high/low and the most recent daily higher high/lower low.
- Bias rule: trade with H4 swing direction; counter-trend allowed only after a failed breakout plus H1 change of character.
- Draw two levels only per pair: the key supply and demand zone that caused the last impulsive move.
- No trade if the H4 range is < 0.6× its 3-month ATR median.
Setup Criteria: Trend + Level + Space
You need more than a green candle. Karen stacks conditions so each trade starts with trend, a level that matters, and space to target.
- Longs: H4 uptrend, price pulls into H1 demand formed by a prior strong move, room to the next H1 swing high ≥ 1.5R.
- Shorts: mirror the above in downtrends.
- Must reject level once (wick or engulf) and then close back with body > 50% of candle range.
- If the price is mid-range between marked zones, skip—no edge without a nearby decision point.
Entry Triggers: Keep It Mechanically Simple
Entries are mechanical, so you don’t talk yourself in or out of trades. This section locks your trigger to a repeatable candle pattern and timing.
- Confirmation candle on M15 that closes in trend direction and takes out prior M15 high/low.
- Place a limit at 50% of confirmation candle for better R when spread allows; otherwise, market in on close.
- No entry in the first 5 minutes of a major news release candle.
- If not triggered within 3 candles after confirmation, cancel the idea.
Risk Sizing, Stops, and Targets
Survival first, then compounding. Karen caps risk tightly and defines exits before entr, so emotions don’t run the show.
- Default risk: 0.5% per trade; max 1% only when H4 trend aligns with daily momentum and news is clear.
- Stop goes beyond the structure that invalidates the setup: below demand/above supply by 0.2× H1 ATR(14).
- First target at 1.5R; scale 50% off, move stop to break-even + spread after target 1 hits.
- Final target near next H1 swing extreme or 2.5–3R, whichever comes first.
- Hard daily loss cap: 2% or two consecutive full-R losses—whichever hits first—then stop trading for the session.
Trade Management: Rules While In the Position
Most edges leak during management. These rules keep winners intact and losses contained without constant tinkering.
- No moving stops away—ever.
- Trail only after 2R is touched: use the last two M15 swing points or a fixed 1× M15 ATR step.
- If a reversal signal appears against your position on H1 at your level, exit the remainder—don’t let a winner turn red.
- If price tags your level and stalls for > 5 M15 candles without progress, close at market.
News and Calendar Filter
News whipsaws are account killers. Karen uses a simple filter to avoid the worst of it without needing to be a macro guru.
- Flat 15 minutes before and after tier-1 events affecting the pair (rates, CPI, NFP, GDP).
- If already in a trade, reduce risk by taking partial at 1R pre-news or tighten to break-even if unrealized P/L ≥ 0.8R.
- Avoid trading the first Monday hour and late Fridays—thin liquidity and messy moves.
Playbook Setups (Two Go-To Patterns)
You don’t need ten patterns. These two cover trending and post-fakeout conditions with clear rules and pictures you can recognize fast.
1) Trend Pullback Rejection (TPR)
You’re buying strength after a healthy dip or selling weakness after a pop, at a level that mattered before.
- Bias with H4 trend; mark the last H1 demand/supply impulse.
- Wait for M15 rejection wick through the zone, then close back in trend direction.
- Enter on 50% retrace of the confirmation candle; stop beyond zone + 0.2× H1 ATR.
- Target 1 at prior H1 swing; Target 2 at 2.5–3R; trail after 2R.
2) Failed Breakout Reversal (FBR)
Catches traps when the market runs stops past a key high/low and snaps back.
- Identify equal highs/lows on H1 that attract liquidity.
- Wait for a stop-run wick closing back inside the range; confirm with an M15 engulf against the breakout.
- Enter on the engulf close; stop beyond the wick extreme; target the opposite side of the H1 range.
- Skip if the stop-run is news-driven within ±15 minutes of release.
Session Routine: Before, During, After
Consistency is built by routine. These steps cut decision fatigue and keep your focus on execution, not opinions.
- Pre-market (15–20 min): update zones, write bias (bull/bear/neutral), list two best pairs with reasons, check calendar.
- During: set alerts at levels; no chart-hopping; one decision per candle—no mid-bar changes.
- Post-market (10 min): screenshot entries/exits; tag outcome (plan win, plan loss, sloppy, skipped) with a one-line lesson.
Psychology and Discipline Rules
Mindset isn’t fluffy—it’s a set of constraints that prevent your worst self from touching buttons. Treat these as guardrails, not suggestions.
- If you feel an urge to “make it back,” step away for 15 minutes and log what triggered it.
- No adding to losers; add to winners only after 1.5R with stop locked at break-even.
- Use a 3-breath check before entry: setup present? Risk-sized? News clear? If any “no,” stand down.
- Daily grade your behavior (A/B/C); only scale size after 5 consecutive A-days, not on P/L alone.
Journal Metrics and Weekly Review
Data drives improvement. Karen tracks a handful of metrics that quickly show whether the edge is real or you’re freelancing.
- Record R multiple per trade and reason tag (TPR/FBR/other).
- Track win rate, average R, and expectancy by setup; kill any tag with < 0.2R expectancy after 30 samples.
- Note time of day and session; concentrate size in the hour block with the best expectancy.
- Weekly: find one “leak” to fix (e.g., late entries, chasing mid-range) and one “keep doing” behavior.
Drawdown Protocol
Your plan isn’t complete without a map for bad weeks. This prevents spiral behavior and protects your long-term curve.
- At -3R in a rolling 5-day window: cut risk to 0.25% per trade and trade only the top setup (TPR or FBR).
- At -6R: pause trading for 48 hours; back-test 20 historical samples of your main setup before returning.
- Resume normal risk only after three A-days in a row and ≥ +2R net in that period.
Scaling and Compounding
Once consistency shows up, you scale gradually and only when your behavior says you’re ready—not your ego.
- Increase risk by 0.1% increments after a full month with expectancy ≥ 0.3R and a max drawdown ≤ 4R.
- Keep absolute dollar risk capped during the new size for 2 weeks before stepping up again.
- Withdraw a % of monthly profits to a “sleep-well” fund; it reduces pressure and revenge impulses.
Checklist: One-Page Pre-Trade Scan
A short checklist keeps you honest at the moment of decision. Read it out loud before clicking.
- H4 trend aligned? Yes/No
- At marked H1 zone with space ≥ 1.5R to target? Yes/No
- M15 confirmation candle in trend direction? Yes/No
- Risk ≤ 0.5% (or 1% only with full alignment)? Yes/No
- News clear ±15 minutes? Yes/No
- Exit plan written (stops/targets/management)? Yes/No
Size Risk First: Fixed Risk Positioning That Survives Losing Streaks
Karen Foo hammers this home before anything else: decide your risk per trade first, then build the trade around it. A simple fixed risk—think 0.5% by default, 1% only when everything aligns—keeps you alive when variance bites. She sets stops where the idea is proven wrong, then back-solves position size so the cash risk stays constant. Using ATR to nudge stop distance means volatility is accounted for without guessing. The result is consistent R-multiples you can actually track and improve.
Karen also caps the day: two full-R losses or roughly 2% down, and she’s done, no exceptions. Correlated pairs share one risk unit, so you’re not secretly doubling exposure on the same theme. She sizes down during drawdowns and sizes back up only after a stretch of A-grade execution, not just green P/L. That discipline turns “small loss, small loss, big win” into a repeatable pattern instead of a lucky week.
Trade The Session Edge: London Open Momentum With Clear Filters
Karen Foo builds a repeatable edge around the London open. Liquidity spikes and clean directional moves give her better follow-through than random mid-day chops. Her core window is the first two to three hours after London opens, when volatility is purposeful, not noisy. If the pre-London price has already run to an H1 target, she stands down and waits for the next quality rotation.
Karen filters every London idea with three checks: H4 trend, nearby H1 level, and at least 1.5R of clear “space” to the next swing. She requires an M15 confirmation candle in trend direction and skips entries within fifteen minutes of tier-one news. On thin Mondays or late-Friday drift, she either halves risk or skips entirely to protect expectancy. If spreads widen or the first 30 minutes print whipsaw wicks through both sides of the range, she waits for structure to reset. Only when these boxes are ticked does Karen press the session, aiming to catch the day’s clean push rather than predict it.
Let Structure Lead: Trend, Level, And Space Before Any Trigger
Karen Foo starts every idea by mapping structure—no indicators, just swings and zones. She identifies the H4 trend first, then marks the H1 demand or supply that launched the last impulsive leg. If the price is mid-range between those zones, she skips because there’s no edge without a nearby decision point. She wants “space” to target: at least 1.5R to the next H1 swing or obvious shelf. Only after that map is clear does she even think about a trigger.
Karen looks for a clean reaction at her level—wick rejection or an engulf back in trend—before drilling down to M15. Equal highs or lows signal liquidity; a stop-run that closes back inside the range can flip bias if the H1 shows a change of character. Invalidation is binary: if price closes beyond the zone by more than a volatility buffer, she’s wrong and out. This way, Karen Foo turns structure into a yes/no framework that removes guesswork and keeps entries aligned with the market’s path of least resistance.
Mechanics Over Prediction: Rules For Entries, Stops, And Targets
Karen Foo trusts repeatable mechanics over gut feel. She triggers off a clear M15 confirmation candle in the trend’s direction, preferably after a wick rejection at her marked H1 zone. If spread allows, she places a limit at 50% of that confirmation candle to improve R; otherwise, she enters on close. News within fifteen minutes cancels the trigger—no heroics.
Stops sit beyond the invalidation level with a small ATR buffer, so a normal wiggle doesn’t kick her out. Karen Foo sets Target 1 around 1.5R to pay herself and move to break-even, then lets the remainder work toward 2.5–3R or the next H1 swing. If price stalls for several M15 candles or prints a strong opposite H1 signal at her level, she exits the rest and hunts the next clean setup.
Process Discipline: Journals, Loss Caps, And Weekly Performance Reviews
For Karen Foo, process is the profit engine. She journals every trade with a screenshot, reason for entry, management notes, and the final R multiple. Each day gets a behavior grade—A, B, or C—so she rewards consistency, not lucky wins. A hard loss cap (for example, two full-R losses) ends the session and forces reflection instead of tilt.
Weekly, Karen Foo runs a fast audit: which setup had the best expectancy, which hour delivered the most R, and what single leak cost the most. She updates a one-line rule to fix that leak and keeps it on her pre-trade checklist. If a setup’s 30-trade sample shows poor expectancy, she shelves it until back-testing proves otherwise. The goal is strict execution of what works and quick removal of what doesn’t, so the process compounds even when the market doesn’t play nice.
Karen Foo’s core message is simple but demanding: survive first, then compound through boring consistency. Across the interview, she keeps circling back to fixed risk per trade, clear invalidation, and a daily loss cap that shuts down tilt before it starts. She organizes her trading around the London session for cleaner momentum, but only when structure, level, and “space” to target line up. When they don’t, she stands down—no forced trades, no mid-range gambling, no guessing. That restraint is powered psychological work she treats like training, not theory: step away when emotions spike, grade behavior daily, and let size follow discipline—not the other way around.
She also hammers the process. Karen maps H4/H1 structure first, waits for a decisive reaction, and uses a mechanical M15 trigger so entries aren’t emotional. Stops sit past real invalidation with a small volatility buffer; partials at 1.5R pay the trade and free her head to manage the rest. Every session has a routine—prep, execution, debrief—and every week gets a quick audit to double down on what actually produced R and to kill what didn’t. If drawdown hits, she cuts size, narrows to best setups, and only scales back up after multiple A-grade days. Put together, the lesson is clear: build a rule-based engine, protect your downside with ruthless risk controls, and let steady execution—not predictions—do the heavy lifting over time.
