FX TRADING METHODS highest point.
Support and resistance trading is one of the most popular Forex strategies. Irrespective of time frame, it tells you when to buy and when to sell. Moreover,
it
works with any currency pair, as long as you identify their low and high points.
3. Aftermath (or Counter- Trend) Trading
After a
resistance point is overcome, we enter virgin territory. Those who bet on supporting the breakout will sell
almost
not primarily interested in gains, something which cannot be said about other traders.
However, the short period of time after a breakout is a realm of
high success rate, and it’s easy to spot when to make your move. However, buying cheap might not be profitable at al l if the price continues to drop. Risk management and closely w a t c hin g m a r k e t i nd i c a t or s b e c o m e paramount.
Conclusion
Some Forex strategies keep it
simple remain and viable
for a long period of time. Others bet on complex i nd i c a t or s and check out early, taking the
imme d i ate l y or continue to push the price upwards in order to profit more. As most traders belong in the first category, breakouts, even spectacular ones, rarely develop into long-term trends. This happens because, on the other side, central banks act to stabilize the price, returning it to its usual range before the breakout. Moreover, central banks hold the upper hand as they are
58 FX TRADER MAGAZINE July - September 2017
Some of the most brilliant strategies have made a name for themselves and remained in the collective memory of traders
new possibilities. Counter-trend strategies rely on this return to previous highs and lows. While prices go on a downward spiral, amassing cheap currency and waiting for it to return closer to the previous high can entail big gains.
Counter-trend trading has a that
traders trusted
them along. Your strategy is shaped by your p e r s o n a l i t y and
your
understanding of the market. How you handle the inherent risk makes all the dif ference when choosing a strategy. Once you have it, regularly tweaking your Forex trading strategy will keep it up to date and suited to you personal ly.
Ethan Featherly
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