Each novice trader is concerned about the question: how to choose your own Forex trading strategy? For successful trading in the Forex currency market you need to have your own strategic approach. Haphazard trading at random is unlikely to bring you profit. A well-designed and time-tested trading strategy is needed.
It is difficult for a novice trader to immediately develop a profitable trading strategy himself , but this is not necessary. For starters, you can use a ready-made strategy that has been tested in practice by other traders, since there is a lot of such information on the Internet now.
But even to choose a trading strategy may not be so simple because their choice is extremely wide. Even on one forex portal, their number can be measured in dozens, or even hundreds.
How to choose your forex trading strategy?
To choose your Forex trading strategy, first you need to determine your trading style , which will be more convenient for you to work with. It all depends on your psycho-emotional state and the time that you can devote to trade. There are four trading styles: scalping, day trading, swing trading and long-term trading. Accordingly, here you have four types of trading strategies.
In addition to this, Forex strategies differ from market conditions. The market is not constant in its movement, there is a trend on it (when the price has been moving in one direction for a long time), flat (when the price does not go beyond a certain range). A flat plot can end with a sharp jump in prices in any direction - a breakdown. In this regard, trading strategies can also be divided into trend, flat and breakout. For different market conditions, various trading strategies are needed, which will significantly differ from each other.
In addition, the trader needs to decide on which timeframe he is preferable to work with.
An important point of any trading strategy is money management . Not observing or not using it at all, no strategy will help you stay in the Forex market for a long time.
Here are some simple tips for choosing your Forex trading strategy .
For starters, choose simple Forex strategies that contain a small number of technical indicators and other elements. You can try the classic options for trading strategies that contain moving averages . These strategies are quite simple but effective. Selected strategies should be easy to understand. You must absolutely understand their logic and algorithms. So there is much less chance of making a mistake than understanding complex strategies, crammed with a large number of indicators.
Start with long-term Forex strategies, as short-term ones (scalping, intraday) require constant market monitoring and high voltage. It is clear that a novice trader wants to see the result faster, but working on short-term strategies requires some experience that remains to be gained.
Having chosen a trading strategy, work strictly according to the parameters proposed to it. Only by studying it thoroughly and getting certain results, you can try to change the parameters to optimize the strategy.
If you find a suitable trading strategy, continue to test it and choose the best parameters. In parallel, look for a different Forex strategy and test on a different demo account . Compare the results of both strategies in specific market conditions. After all, the market is constantly changing, and each Forex trading strategy will give different results under different market conditions. You can choose several different strategies, for example, trending strategy, flat, breakdown, strategy for working on the news. Thus, under any market conditions, you will earn on different strategies, and not just wait for a trend for example.
As you can see, the choice of a trading strategy is a laborious and not quick process. But it is necessary for every novice trader to go through it. Indeed, without a trading strategy, Forex trading cannot be effective and profitable.
It is difficult for a novice trader to immediately develop a profitable trading strategy himself , but this is not necessary. For starters, you can use a ready-made strategy that has been tested in practice by other traders, since there is a lot of such information on the Internet now.
But even to choose a trading strategy may not be so simple because their choice is extremely wide. Even on one forex portal, their number can be measured in dozens, or even hundreds.
How to choose your forex trading strategy?
To choose your Forex trading strategy, first you need to determine your trading style , which will be more convenient for you to work with. It all depends on your psycho-emotional state and the time that you can devote to trade. There are four trading styles: scalping, day trading, swing trading and long-term trading. Accordingly, here you have four types of trading strategies.
In addition to this, Forex strategies differ from market conditions. The market is not constant in its movement, there is a trend on it (when the price has been moving in one direction for a long time), flat (when the price does not go beyond a certain range). A flat plot can end with a sharp jump in prices in any direction - a breakdown. In this regard, trading strategies can also be divided into trend, flat and breakout. For different market conditions, various trading strategies are needed, which will significantly differ from each other.
In addition, the trader needs to decide on which timeframe he is preferable to work with.
An important point of any trading strategy is money management . Not observing or not using it at all, no strategy will help you stay in the Forex market for a long time.
Here are some simple tips for choosing your Forex trading strategy .
For starters, choose simple Forex strategies that contain a small number of technical indicators and other elements. You can try the classic options for trading strategies that contain moving averages . These strategies are quite simple but effective. Selected strategies should be easy to understand. You must absolutely understand their logic and algorithms. So there is much less chance of making a mistake than understanding complex strategies, crammed with a large number of indicators.
Start with long-term Forex strategies, as short-term ones (scalping, intraday) require constant market monitoring and high voltage. It is clear that a novice trader wants to see the result faster, but working on short-term strategies requires some experience that remains to be gained.
Having chosen a trading strategy, work strictly according to the parameters proposed to it. Only by studying it thoroughly and getting certain results, you can try to change the parameters to optimize the strategy.
If you find a suitable trading strategy, continue to test it and choose the best parameters. In parallel, look for a different Forex strategy and test on a different demo account . Compare the results of both strategies in specific market conditions. After all, the market is constantly changing, and each Forex trading strategy will give different results under different market conditions. You can choose several different strategies, for example, trending strategy, flat, breakdown, strategy for working on the news. Thus, under any market conditions, you will earn on different strategies, and not just wait for a trend for example.
As you can see, the choice of a trading strategy is a laborious and not quick process. But it is necessary for every novice trader to go through it. Indeed, without a trading strategy, Forex trading cannot be effective and profitable.
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