Forex Trading Strategy
There are many different Forex trading strategies. However, there are some basics of reading a price chart that you need to know before you can move on to learning any one strategy in-depth. Let’s cover the basic building blocks of trading the Forex market from a technical analysis approach.
You may have heard that maintaining your discipline is a key aspect of trading. While this is true, how can you ensure you enforce that discipline when you are in a trade?
One way to help is to have a trading strategy that you can stick to.
If it is well-reasoned and backtested, you can be confident that you are using one of the successful Forex trading strategies. That confidence will make it easier to follow the rules of your strategy—therefore, to maintain your discipline.
A consistent Forex trading strategy provides advantageous entry signals, but it is also vital to consider:
1.Selecting the Market:
Traders must determine what currency pairs they trade and become experts at reading those currency pairs.
Traders must determine how large each position is to control for the amount of risk taken in each individual trade.
Traders must develop rules governing when to enter a long or short position in a given currency pair.
Traders must develop rules telling them when to exit a long or short position, as well as when to get out of a losing position.
5.Trading Tactics: Traders should have set rules for how to buy and sell currency pairs, including selecting the right execution technologies.