Heroes of Ukraine

«Market Leader» - news and previews making you rich.

Wednesday, 24 May 05:32 (GMT -05:00)



Foreign exchange market

Forex Trading Strategies – Recipes for Successful Trading


We are going to dedicate this article to FX trading strategies, which is specific trading algorithms allowing you to trade for profits.
 

 

 

 

This article will let you learn the following:
- what are FX trading strategies
- why you need trading strategies
- various types of trading strategies
- capital management rules
- how to choose a trading strategy
 
What is a trading strategy?
 
Any professional activity requires a certain plan. Professional traders need trading strategies to avoid reckless trading through:
- determining the entry and exit rules
- determining the money management rules
This leads us to believe that a trading strategy is a set of trading and money management rules, which are required to be followed at all times to show consistent results.
 
Why do you need a trading strategy?
 
Can you trade Forex without a trading strategy? Yes, you can, but this is going to lead to losses. It’s impossible to trade financial markets successfully without a profitable strategy! Indeed, trading is a rather complicated type of human activity, whatever those commercials say. Even if you get exclusive trading software with excellent features and intuitive user interface, this doesn’t necessarily mean that you are going to be a winning trader making money effortlessly. Trading Forex or any other financial market is a serious activity, which means it requires a serious approach. That’s why you cannot afford to gamble here, if you want to trade Forex for a living. You bet your money to win more money. Reckless trading is a sure way to losses. That’s why your trading needs to be planned and guided in a certain way. The best way is to get yourself a nice trading strategy and get yourself up and running with it.
 
Types of trading strategies
 
There are several types of trading strategies for FX.  For starters, they can be of 2 major types: those based on technical analysis and those based on fundamental analysis.
 

 

Strategies based on technical analysis imply using technical and charting tools to make predictions used to enter and exit a trade. For example, if we are talking about the “Victory” trading strategy, the best time to enter a trade is the situation when the price rebounds from the top of the sloping channel:

8bb1f4e70bb9.jpg

There is another strategy. It’s called “20 points a day”. The trader gets a buy signal if the price breaks above the Moving Average and the signal ling of the Momentum indicator also breaks above the indicator’s central line:

0b5dd4d063a9.jpg

Strategies based on fundamental analysis imply analyzing daily macroeconomic reports to make trading decisions based on the data. Those reports are scheduled and released throughout the trading week, including unemployment rate, consumer confidence, interest rates, GDP etc. based on the data, traders make their trading decisions. For example, if the GDP report indicates a slowdown, the country’s national currency is very likely to get weaker against other currencies since this means a weaker economy. Or if the central bank raises the interest rates, this makes the national currency stronger.
 

 

For example, when the Federal reserve (USA) raised the interest rate by 0,25% during the latest meeting, this is made the U.S. Dollars stronger against other international currencies:

5026622635c7.jpg

EURUSD instantly dropped down, which means that the Euro got weaker against the U.S. Dollar as the U.S. Dollar got stronger against the Euro. 

f2e7e624d2c3.jpg

In this case, the task is to analyze the calendar, find major news, wait for the news, and trade accordingly.
 
Also, trading strategies can be divided depending on the trading approach:
Trading with the trend
Trading against the trend
Martingale strategies (double your bet each time you lose)
Strategies based on pending orders
Math strategies
Scalping strategies
Intraday, mid-term and long term strategies and so much more.
 
Money management
 
This is an inseparable part of any decent trading strategy. It makes up for 50% of success.
Money management is all about managing your capital wisely to avoid major risks and losses and being able to withstand drawdowns, which are inevitable since no trader can win 100% of the time.  

 

 

85032c11fa97.jpg

Conservative traders never invest more than 1-2% of the entire capital in a signal trade. They think about saving their money first and multiplying it second.
Aggressive trader risk over 5% per trade on a regular basis. Some of them may even go all in, as poker players say. This is too risky and usually brings nothing good over the long term. So, avoid aggressive trading styles.
 
Why to choose a trading strategy for a beginner?
 

 

Practice shows that the best choice for most beginners is a strategy based on technical indicators with 100% clear algorithm and no ambiguous signals. For example, some indicator triggers a signal and the trader buys or sells the chosen asset depending on the direction of the signal.

28149ebde93f.jpg

You can also invest of PAMM accounts to get passive income. For the purpose, it’s necessary to choose them wisely. We recommend using pro-rebate.com for investment purposes. Good trading and investing!

 

You are free to discuss this article here:   forum for traders and investors

 

Add to blog
Got a question? – Ask it here »
 

Euro. New Optimism

The 2017 GDP forecast for the European Union is reported to have been increased by the Euro Commission from 1,6% up to 1,7%. This means that the economic growth in 28 EU countries, according to the general estimate, is likely to reach 1,9%. The Euro Commission has reported about economic growth for the 5th year in a row. They expect the tendency to remain this and next year as well. The unemployment rate is expected to shrink all the way down to 9,4% this year.

 

 
Publication date: 17 May 07:04 AM

Masterforex-V Academy Names Forex Brokers with Hidden Commissions (Big Swaps) of 40 Pips a Week

Most Forex traders out there always try to find a way to make big money without any risk. On the surface, some of such ways do really look unbeatable. However, those solutions eventually fail if applied under the trading conditions that leave much to be desired as they are offered by some brokers disinterested in their clients’ success. At the end of the day, such solutions end up causing big losses instead of generating stellar profits. This is something Masterforex-V Academy experts figured out after conducting in-depth analysis of the FX brokerage industry.

Publication date: 16 May 07:20 PM

Pro-rebate.com: $400 of Profit Made by Auto-Copying Masterforex-V’s Best Traders In April 2017

 The strategy that Masterforex-V Academy has been sticking for years now keeps on brining fruit to traders and investors. The main distinctive feature that makes these investments stand out from the crowd is the fact that they are 100% reliable and there is zero chance of losing money. Those investments are based on sound money management without Martingale and other tricks. All of those investment accounts are monitored at myfxbook.com. VIP traders has been showing consistent profits ever since they were launched more than 2 years ago.

Publication date: 13 May 12:40 AM

Online Forums for FX Traders – Recourses to Leverage Your Trading or Another Way to Trick You into Losing Money?

As you probably know, there is no such thing as a free lunch. Most of us like this saying. But how do we apply it in real life? A good example is when we are offered to participate in a promo and get a chance to benefit from it in a certain way. Frankly speaking, each and every FX broker out there offers a certain kind of bonuses or promos to retail clients. Most of the time, you are offered a welcome bonus, deposit bonus, or even no-deposit deposit bonus. Should all of that be treated seriously?

 

 
Publication date: 12 May 04:21 AM

Masterforex-V EXPO Names Best Forex Brokers for Beginners in May 2017

No matter whether you are a beginning or an advanced trader, at some point during your trading career you have to choose an FX broker. And when choosing it, you obviously want to choose a reputable broker.

 

 

 

Publication date: 10 May 08:59 PM

Masterforex-V Expo Names Best MT4 Brokers in May 2017

Metatrader 4 (or MT4 for short) is still the world’s most popular Forex trading software. It was created to make the trader’s life easier and improve their trading performance. Today, there is even a web-based version of the trading software allowing you to access the market via any browser you like.
 
Publication date: 10 May 08:39 PM

Bitcoin Exchange Rate Goes Above $1700

Bitcoin is reported to have set a new record by seeing its exchange rate go above $1700. This is a 45% gain over the last 4 weeks. Given the increasing interest in the crypto-currency shown all around the world, international experts predict that by the end of 2017, BTC may reach even $4000.
 
Publication date: 10 May 07:47 PM

Trump Doesn’t need a Strong Dollar

A couple of weeks ago, Donald Trump made a statement related to the USA’s money-and-credit policy. This leads us to believe that in the near future Washington may well abandon the policy leading to a stronger dollar.

 

 
Publication date: 10 May 05:16 AM

FortFS, Masterforex-V Academy and PRO-Rebate Open «Double Bonus» Season

One of the leading international Forex companies named Fort Financial Services, which was recognized the world’s best FX broker for beginners in 2016, keeps on making clients happy with the help of various pleasant surprises.

Publication date: 04 May 10:37 AM

Forex Means Market Without Crisis

Most of us have already felt what an economic crisis is. Most likely, we keep on looking for extra income and financial stability. Is it possible? Yes, indeed, if discover Forex. What is conventional Forex?

 

 
Back in 1989, the daily FX turnover used to be as little as 600 million dollars a day.  In 1998, another global crisis broke in. Back then, the turnover easily exceeded 1 trillion dollars a day. By 2010, the turnover had already reached 3,5 trillion dollars. This time, it was the 2008 crisis that contributed to this growth. These days, the daily FX turnover is well above 5 trillion dollars a day. For the sake of comparison, the monthly NYSE turnover is well below the daily FX turnover. It sounds a little bit shocking, doesn’t it?
Publication date: 01 May 09:36 AM