Forex Trading Strategies

Forex-Trading-Strategies

Introduction

A trading strategy is a position taken by the investor basis the knowledge gathered leveraging technical analysis, fundamental analysis, news-based events or expert advice on the market. This move may be a buy or a sell move triggered by verified data and proven results.

There are several trading strategies which work for different investor groups with different levels of risk appetite and expertise. There is no one size fits all approach.

Traders are people who want to tread the market, make the most of it and sustain the returns based on a strategy which changes from time to time.

The below are  mejores estrategias Forex egies which work for different groups of investors with different levels of access to information, risk appetite, levels of trading and expected return. These are high level strategies but not to be construed as step by step user guides.

Trading Plan

A lot of traders define trading plan as a lot of money they want to make in the shortest possible time. This is not true. A beginner trader should focus on various aspects like learning the trading strategies, entry and exit criteria, mindset of a trader so on and so forth.

Put all the learnings into a do-able action plan which helps attack the market. Have discipline to execute the trading plan and be consistent with the execution. Take charge and be accountable for the results you see. The idea is not to make a lot of money, it’s to learn the trade, master it, make consistent money. If a trader has an account is 1000 USD if he or she is making 100 USD per month it’s a positive growth, he/she is ahead of a trader who has an account of 10,000 and loosing 100 USD per month. Consistency and discipline in implementing the learnings is the key to win the game.

Weekend Trading

More and more traders adopt this trend. This is a proved way of analysing the market trend of the week past and strategizing for the week next. Positioning to enter and exit the market at certain specific triggers or signals to stay aligned with the goal of the trader. This involves studying the weekly chart across the time frames,highlight highs and lows recorded, leverage this data, predict future market and strategize accordingly.

Pull back strategy

Trading with the pullback strategy working in your favour is a great way to enter the market. When a long term upward trending stock starts falling downwards it’s the best time to buy the market. The basis of this decision is the underlying trend of the stock not the current trend which may reverse anytime.

The Contrarian

The general tendency of most traders is to pay attention to what the price is doing right now, but they do not pay head to the fact that price re-adjusts and the market repositions itself. They get caught on the wrong side of the market when they buy at the time when the price is nearing high and sell when its nearing low.

Contrarian is a rebel strategy, sometimes, the market plays the mystique, a Contrarian is a trader who goes against the herd and plays the game. These traders not only see the market trend, but they predict the next move of the herd and use this as a factor to take or not to take a position.

The Pattern

Study the market and identify patterns which show higher high (HH) and higher lows (HL) in an upward trending market, identify patterns which show lower high (LH) and lower lows (LL) in a downward trending market. When the pattern breaks from higher high to lower high that’s a signal to shift gears and switch positions. If this observation is substituted with a lower high and lower low in the market that’s when we can start selling.

The Parallels

This is a range bound trending, price fluctuates but won’t go beyond an upper or a lower limit. The upper level is the resistance level and the lower level is support level. It stays within these limits. This is a non-trending or a side-ways market and accordingly a trader may position his/her next move.

Choppy Market

A smart trader stays out of choppy market trend. A choppy market is a sideways market with tight resistance and support limits. The market moves between these two limits very closely leaving no much space to predict and if a trader plays during this phase he or she ends up losing profits to this trend instead of reaping.

Intra-Day vs. End of Day Trade

A lot of traders out there believe staring at the intra-day charts provides great benefits and throws some light on trading. The best strategy is not to see these charts as these put success far from our way.

Analyze the market and set your trade basis end-of-day data and let the market do the thing. There is very little anyone can do with controlling the price and the market movement, it’s better to go with the flow rather than fight it. This will remove the part where the trader dedicates to watching trends on TV and worrying about them.

End of day data is more reliable than Intra-Day data. This paves the way for the trend followed by the market throughout the day and the result of such trend.

The Swing Trader

This is a brilliant way of observing the market and piggy-backing on the tide to get the best out of it. The price in a market will always swing high and low in a market. Trader observes the trend of the market if its upwards, buys the market at a price which swings low and sells when the price is swinging high. This is an art and skill of reading the trend and acting accordingly.

The Wait Game

The game of trading and the mejores estrategias Forex is to move money from the impatient to the patient. The best of traders do nothing most of their time. They study the market, wait it out and execute for the big kill. They have crocodile approach which stalks its prey and kills. The amateur traders buy and sell and follow the market, but the sniper traders study the market, study the investor group, study the next move of the investor group and then make their move to hit it big. High frequency trading is where a trader books a lot of losses, it’s not execution it’s the strategy which books profits.

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