To become a
successful Forex trader it is not enough to have a sort of intuition to
predict fluctuations happening with currency pairs and to be a lucky one
to happen at the right place and in the right time. All these factors
can play their roles, sometimes even significant ones, but the more
efficient and logical way is to plan and follow your own trading
strategy that can save your from unreasonable and risky operations.
Experts affirm that there exist a lot of widespread Forex tradingstrategies
one may follow without taking into account stand-alone strategies of
Forex trading used only by few traders. Below you can find a list of
some well-know Forex trading strategies which can be considered as the
most reliable ones and checked by many people as working and
successful. At first let’s try to define in brief what the main purposes every Forex trading strategy follows and how you can choose the best strategy for yourself. You need to figure out that it is rather stupid to consider that any strategy can give a 100 percent guarantee you will manage to bypass all pitfalls and earn money in a quick way without any risks and loses. Understanding any strategy in such way may cause a lot of troubles and bad consequences so it is better to stick to an idea that a Forex trading strategy is foremost a plan and it depends only on your own personal qualities how successfully you will manage to realize this plan. Another thing you should bear in mind that any reliable strategy contains all necessary tips and hints one may use to become a proficient trader.
Recommendations
concerning selection of the best strategy from all existing Forex
trading strategies can seem useless because as it was mentioned that
everyone should choose a strategy according to his/her own preferences
but still there are few advices one may stick while selecting one of
such Forex trading strategies:
- all strategies are based whether on a fundamental or technical analysis which means that traders may concentrate on certain calculations and periods of time or can stick to broad spectrum analysis while developing a trading strategy. Experts strongly recommend to use both fundamental and technical means of analysis to create a long-term strategy which can determine all points – whether entry or exit ones.
- never start a live trading without testing your strategy as an owner a FX demo account by means of which you can practice your skills until become pretty much sure in your plan and will manage earn money at least virtual one. Do not join the army of Forex newbies who started quickly and lost everything because of an experience lack. Hurry is not appropriate when it deals practicing in applying Forex trading strategies.
- in spite of your strategy plan you should always stick to the Forex trends which can be very fluctuated but still only by following them you can expect to be in the benefits eventually.
Taking into consideration all these advices you can start to choose the most applicable strategy for yourself. Here the list of the most common Forex trading strategies a lot of traders select as the major ones:
1) Forex Arbitrage Strategy. Such strategy predetermines a plan when a trader gets profits from ineffectiveness in the prices of numerous currencies. Some suppose that usage of such strategy is immoral but when it comes to legal business strategies what can stop you to win in all available ways? Besides those traders who use Forex arbitrage strategies contribute to stabilization of multiple currencies, which brings only benefits to all parties involved into Forex trading. Like any other strategy this one has lacks as well – it is a very complex one and requires a strong background in understanding all currency price inefficiencies. In addition to this you will have to compete with numerous traders who follow the same strategy using fine-tuned automated Forex trading software and platforms.
2) Forex Account Management Strategy. In
a case you see only faults and disadvantages in becoming a daily trader
and are interested in investing more than in trading then you should
definitely choose a Forex manager account strategy – which can be
described in brief as a mutual fund where you can leave your money
(having one of such Forex manage accounts) and then allow a hired
professional trader to run this account instead of you. In such way you
can get more experience without a lot of efforts and take all advantages
from seasonal changes of Forex market. For sure, you will have to make
your own analysis (fundamental one) of a currency and a country of a
chosen currency to develop a profitable investment plan.
3) Forex Range Trading Strategy. Finding levels responding in the resistance and support of certain currency pair is the key task and secret weapon for providing one of Forex range trading strategies. After identifying these levels you can purchase when this pair reveals support and sell in a case it shows resistance.
What are support and resistance levels? Support denotes the price of a certain currency pair if this price is not going to be reduced at the moment. Sometimes price just doesn’t want to reduce and such situation can be caused by many reasons. The main task is to notice a support level – when the price of a currency pair hits the bottom rate again and again but without being less than the bottom price. For sure there will come the moment when the currency pair price becomes less than the bottom price but you have to stay in the benefits while there is the support level. The same concerns the resistance level but on the contrary – there is the high price which doesn’t want to become higher. The range happens when the price of a certain currency pair goes up and then down reaching support and resistance levels and that is when you need to buy and sell basing on low and high points.
- all strategies are based whether on a fundamental or technical analysis which means that traders may concentrate on certain calculations and periods of time or can stick to broad spectrum analysis while developing a trading strategy. Experts strongly recommend to use both fundamental and technical means of analysis to create a long-term strategy which can determine all points – whether entry or exit ones.
- never start a live trading without testing your strategy as an owner a FX demo account by means of which you can practice your skills until become pretty much sure in your plan and will manage earn money at least virtual one. Do not join the army of Forex newbies who started quickly and lost everything because of an experience lack. Hurry is not appropriate when it deals practicing in applying Forex trading strategies.
- in spite of your strategy plan you should always stick to the Forex trends which can be very fluctuated but still only by following them you can expect to be in the benefits eventually.
Taking into consideration all these advices you can start to choose the most applicable strategy for yourself. Here the list of the most common Forex trading strategies a lot of traders select as the major ones:
1) Forex Arbitrage Strategy. Such strategy predetermines a plan when a trader gets profits from ineffectiveness in the prices of numerous currencies. Some suppose that usage of such strategy is immoral but when it comes to legal business strategies what can stop you to win in all available ways? Besides those traders who use Forex arbitrage strategies contribute to stabilization of multiple currencies, which brings only benefits to all parties involved into Forex trading. Like any other strategy this one has lacks as well – it is a very complex one and requires a strong background in understanding all currency price inefficiencies. In addition to this you will have to compete with numerous traders who follow the same strategy using fine-tuned automated Forex trading software and platforms.
2) Forex Account Management Strategy. In
a case you see only faults and disadvantages in becoming a daily trader
and are interested in investing more than in trading then you should
definitely choose a Forex manager account strategy – which can be
described in brief as a mutual fund where you can leave your money
(having one of such Forex manage accounts) and then allow a hired
professional trader to run this account instead of you. In such way you
can get more experience without a lot of efforts and take all advantages
from seasonal changes of Forex market. For sure, you will have to make
your own analysis (fundamental one) of a currency and a country of a
chosen currency to develop a profitable investment plan. 3) Forex Range Trading Strategy. Finding levels responding in the resistance and support of certain currency pair is the key task and secret weapon for providing one of Forex range trading strategies. After identifying these levels you can purchase when this pair reveals support and sell in a case it shows resistance.
What are support and resistance levels? Support denotes the price of a certain currency pair if this price is not going to be reduced at the moment. Sometimes price just doesn’t want to reduce and such situation can be caused by many reasons. The main task is to notice a support level – when the price of a currency pair hits the bottom rate again and again but without being less than the bottom price. For sure there will come the moment when the currency pair price becomes less than the bottom price but you have to stay in the benefits while there is the support level. The same concerns the resistance level but on the contrary – there is the high price which doesn’t want to become higher. The range happens when the price of a certain currency pair goes up and then down reaching support and resistance levels and that is when you need to buy and sell basing on low and high points.
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