Boosting Profitability with HTF-Filter – How to Cut Losses and Maximize Profits

The fundamental rule of trading is to let your profits grow and cut your losses quickly. And today we will talk about how to effectively use the High Time Frame (HTF) Impulse Filter in the Scalper Inside Pro indicator to let profits grow and cut losses as soon as possible.

HTF Impulse Filter (HTF-Filter for simplicity) has recently been introduced in the latest versions of the Scalper Inside Pro indicator. It was created specifically to increase profitability and simplify analysis, and many of our followers and clients have already appreciated its importance and the possibility of simplifying the trading process.

But since we’re still occasionally asked questions about the use of HTF-Filter, today we decided to focus on this module, built into the Scalper Inside Pro indicator, in more detail with examples and some secrets of its application.

Why is it Important to Let Profits Grow and Cut Losses?

In our practice, we have encountered that not everyone fully understands that WR% (Win Rate – the number of winning trades relative to the number of losing trades) itself is not the only important factor. We are specifically referring to the Forex market, not binary options. While it is indeed an important measure, it is not the sole determinant of success. It allows us to quickly assess the current market situation on the analyzed trading instrument.

Let’s look at some examples using the Scalper Inside Pro indicator:

We see that for AUDCAD the WR% was 81%. For AUDCHF = 61.5% and for GBPAUD = 87.5%.

Thus, all other things being equal, analyzing the market before the daily trading, we can quickly assess the current arrangement of forces on the price chart and decide which of the trading instruments we will temporarily put aside. Yes, we can try to optimize the indicator for the current trading instrument and get better results.

So, we got a little distracted. Let’s go back to the quick market analysis we conducted earlier. In this case, we simply consider the principle of finding potentially profitable trading instruments, regardless of whether we can adjust them with the indicator settings or not. However, in the end, we choose the pairs that show the highest WR% for us. In our case, those pairs are GBPAUD and AUDCAD.

So, do we have enough information? The answer is yes. We have chosen a trading instrument and now we are waiting for the signal from the Scalper Inside Pro indicator to open a position. Something like this, for example:

Please note that now we do not consider the effect of strong levels from higher timeframes as an additional filter, as we have repeatedly written about before. Let’s look at an example where we opened a position without any additional analysis.

So, what is our next step, as serious and experienced traders who plan to trade professionally and for a long time. What if we have not previously assessed strong levels from higher timeframes and we only have potential profit levels to close positions? In most cases, this is sufficient for successful trading, but is there an opportunity for us to further enhance our trading profitability? Of course, yes! Our trading will become much more efficient if we let the profits grow and cut the losses as early as possible.

That is why the HTF-Filter module was integrated into the Scalper Inside Pro indicator. This module has been successfully tested by us many times before and it has proved itself as an additional filter that reacts flexibly enough on trend changes, but it does not react on market noise, which is important to avoid excessive triggering of the filter. That is why the idea of adding it to the indicator turned out to be very successful.

You should also keep in mind that no matter how accurate your calculations are, it is impossible to predict with 100% certainty the exact level the price will reach. There may be instances where the price does not reach the expected level, but in other cases, it may exceed it significantly, even several times over. This is where the HTF Impulse Filter can help us.

So, let’s start exploring the HTF-Filter module with examples of how this module can help us cut losses as early as possible.

How HTF-Filter Can Help Us Cut Losses as Early as Possible

In the following example for GBPUSD on the M5 timeframe, we can observe a Buy signal that is confirmed by the HTF-Filter.

Then we see that the price starts a downward movement, and the HTF-Filter reacts by generating a Sell signal. This downward impulse is currently not particularly strong, and the price tries to resume the upward movement (with the appearance of new Buy signals from the HTF-Filter), but eventually continues the downward movement.

Thus, closing the position with a stop loss will occur much earlier and result in a smaller loss compared to waiting for a new reversal signal from the indicator.

The following example is for EURUSD:

The Scalper Inside Pro indicator is a trend indicator. Its purpose is to identify the optimal moment to enter a trade and set target levels that the price can potentially reach quickly. But if the price happens to be in a flat market, then a good solution would be to close such a position at breakeven or even in a small loss in order to reduce the possible large losses. But how can we identify a flat market zone? Here again HTF-Filter will help us. If we see repeated opposite HTF-Filter signals, it is a good sign not only to move our stops but also to wait for a possible price reversal. In such a case, if you observe a similar market situation, it is better to close the position, and wait for a new signal.

That’s good, you might say. But does HTF-Filter work only for currency? Of course it works for any trading instruments – futures, indexes, crypto, etc.

Cutting losses on the NIKKEI 225:

Cutting losses on the BITCOIN:

Okay, now that we have studied how to cut losses using the HTF-Filter, let’s move on to the next chapter: “Letting Profits Grow”

Letting Profits Grow with HTF Impulse Filter

Let Profits Grow on GBPAUD:

The general principle of work is similar to the situation with cutting losses, but in this case, we move the stops into the profit zone, allowing for trailing profits to maximize profits.

Let Profits Grow on BITCOIN:

Let Profits Grow on XAUUSD (GOLD):

This is optional because sometimes the price movement does not provide such an opportunity. However, if you observe such a pattern, it can be a good option to move stops to a better price without letting the price knock your stops out too early.

Let Profits Grow on ETHEREUM:

We also want to draw your attention to the fact that it is not necessary to wait for the triggering of stops to close a profitable position. If there is a strong level on the price path (which the price has already touched multiple times), we can consider using that level as a target for taking profits from our position.

Don’t forget to consider the price itself as a hint! Take a look at the Low on the price chart – the price has reacted strongly to the level where a significant accumulation of orders occurred. It may not always be wise to expect another strong penetration of the level, but taking profits at that strong level, the next time the price approaches it, can be a good decision.

Anticipating your next question – whether this HTF-Filter strategy works on higher timeframes – our answer is a resounding yes. It is effective on any timeframe. The only thing that differs is the scale of the price movements and the potential profit size.

Let Profits Grow on AUDNZD H1:

Let Profits Grow on EURJPY H1:

Let Profits Grow on BITCOIN H1:

Okay, we believe that these examples will be sufficient for today to start applying the HTF Impulse Filter in your trading more effectively. Perhaps in the future, this article will be supplemented with more examples if there is anything that can further enhance the examples shown today.

And finally…

Some Tips About Trading and Scalper Inside Pro Indicator

• Choose trading instruments with the highest possible WR%
• Don’t take on too many trading instruments at once – first study the indicator’s performance on a few trading instruments, and then proceed to add new ones.
• Try using the built-in optimization module of the Scalper Inside Pro indicator for the trading instruments that interest you. If, after optimization, the WR% is still not satisfactory, then set that instrument aside and move on to another one.
• Remember that nothing lasts forever, and if today a certain instrument shows a low WR% due to a flat market phase, the situation may change in a week or a few days. Therefore, it is important to periodically recheck the trading instruments.
• Avoid trading during important news releases or, if possible, move your positions to breakeven levels.
• Be sure to use advanced market analysis instruments, such as strong levels from higher timeframes, HTF Impulse Filter – remember that our main goal is not to become successful traders for one or two months, but to achieve the ability to profit over an extended period of time.
• The Forex market, like any other market, does not tolerate a casual approach. Those who fail and complain about not succeeding are often the ones who expect instant results. However, success in trading does not come easily. I can confirm this from my own 19 years of experience. Only those who make an effort, persevere, and refuse to give up can achieve success in this field.

And last but not least…

Never trade with your last or borrowed funds! Doing so will severely restrict you and prevent you from making rational trading decisions. Making systematic decisions is crucial in trading, and allowing your emotions to interfere can be detrimental.