Posts Tagged ‘Strategies’

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Short Term Trading Strategies – in Forex for Profit

Saturday, September 4th, 2010

If you are looking at short term trading strategies in forex trading you really have two methods you can use forex scalping or day trading and on the other hand swing trading but which is best? Let’s tak a look…

Day trading or scalping is a method where traders seek to take advantage of intra- day moves of a few hours and use support and resistance levels in this period to determine when to execute their trading signals.

The problem is it doesn’t work. You have countless millions of traders trading with different forex trading strategies and methods, all with different motivations and to say what this group of traders will do in such a short time span, is laughable.

Of course, you see lots of short term trading strategies claim to make money but none them do. If you see a track record of profits, then you will see the disclaimer below as well – read it and you will see why the track records are meaningless:

“CFTC RULE 4.41 – Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown”.

So there you have it – they have never been traded and are made up.

All moves in a day are random and that’s why you never see a real track record of gains – day trading is a mugs game – Avoid it!

Forex Swing Trading

The other short term trading strategies are based around swing trading which tries to catch the intermediate moves in trends or trading ranges and these moves normally last for between 2 days and a week.

This method works and is an excellent way for novice traders to trade, for the following reasons:

1. It’s easy to devise a swing trading system based around support and resistance, momentum and breakouts.

2. There are lots of opportunities – which is an advantage as most traders are impatient.

3. You take profits and losses quickly, normally within a few days – so you don’t need the discipline to sit on trades for long periods.

Swing trading is essentially taking advantage of trades that last anywhere from a few days to a week and taking advantage of over bought / oversold scenarios and these tend to occur all the time.

If you want short term trading strategies for profit, take a closer look at swing trading and you will find it a great way to trade especially if you’re new to forex trading and forget forex day trading all it means is guaranteed losses

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Forex Currency Trading Strategies

Wednesday, September 1st, 2010

The particular forex trading strategy you decide to use will depend partially on your personality but also partially on how much money you have to start with. If you are starting with a relatively small amount of money, say under five thousand dollars, you are going to want to use trading strategies that sync well with a mid-term time horizon, otherwise known as swing-trading. For those traders who do not have very much starting capital to trade with, trying to become a day trader right out of the box is likely going to be a losing endeavor. This is because you must master trading off the higher times frames first, then as you get good at this type of trading you can think about learning how to day trade, that is if you are interested in it.

The best forex trading strategies are those that allow you to remain calm and confident in each trade you take, while not requiring you to sit in front of your computer all day or wait for some silly thing like an indicator to give you a buy or sell signal. Simple trading strategies like those built around analyzing raw price charts and the price dynamics that occur on them, are what most professional traders use. You will be very hard pressed to find a professional trader analyzing a price chart with 3 different oscillators and 10 different moving averages on it, yet the ironic part is that his how many beginning traders trade the markets.

As stated above, the specific forex trading strategy you use not only depends on the amount of money you have to start with, but also on your personality. Most people are drawn to the world of forex trading because they are unhappy with their current job, or perhaps they are happy and just wish to make some extra money. Most people are not drawn to forex trading because they think it sounds really fun and entertaining to sit in front of a computer screen for five hours at a time watching price bars go up and down. Yet, surprisingly, this is exactly what most beginning traders tend to do. They tend to think the more time they spend watching their charts or their trade, the more “control” they have over the market and thus the better they will do in the long-run.

This is actually one of the big paradoxes of forex trading; the very reason that most traders fail to make money on a consistent monthly or quarterly basis in the market is primarily because they are too involved with their trades and meddle with them while they are under execution. These types of over-activity mistakes that traders make by being too involved with their trades are generally a result of having a complicated trading strategy, or one that they do not fully trust. When you trade forex trading strategies that are simple in design and are based upon simple price dynamic concepts, you really have nothing to be confused or unconfident about, and as result you’re trading will improve over time.

To find out more about simple forex trading strategies click here: Forex Trading Strategies

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Swing Trading Strategies Are the Best Way to Learn Forex Trading

Monday, August 30th, 2010

Since you are reading this article I can assume that you are familiar with trading currencies in Forex market. Probably you already know that it is not an easy task to become a consistently profitable trader. If you are someone like I was when I got started my journey in Forex then you are probably looking fro a perfect system that can help you consistently take the profit from market. Unfortunately there is no universal system that suits everyone. But you can make a system to be a perfect one for you by adapting it to your personal traits.

I don’t know about you but I was jumping from system to system trying to find a perfect one. I tried scalping. I tried to trade New York session, London session. I traded economic news. I wouldn’t say that I completely failed but what I noticed from my experience is that the higher the time frame I traded the better the overall results in the long run.

In my opinion the long trade works out better because of have two major reasons. First reason is that when you look at the chart of higher time frame it has much less noise. It is easier to identify patterns, support and resistance etc. The second reason is that trading longer term almost completely eliminates emotions that interfere with the trading decisions. I see the signal, enter the trade, set up stop loss and take profit orders and leave the trade to mature. I come back to the charts the next day to see if the trade is still evolving or if it hit the stop loss or take profit levels. Once I see the appropriate signal I enter the market again. In the long run it turned to be much more profitable than if I would spend long time in front of the charts babysitting my trades.

That’s why I always recommend beginner traders or someone who struggles to make consistent profit in Forex start practicing swing trading strategy first. Pick a system with the simple rules and apply it over and over again. Over time your execution of the trades will become perfect. You will see how much easier it becomes to make consistent profit in Forex. First you spend less time setting up the trades. Second you save you emotional energy by not overreaction on the price action.

Here is one simple swing trading system I would like to share with you. First you need an indicator called Heikin-Ashi candles. Second and most important thing is you need to learn to identify significant support and resistance levels. If you learn it you are well on your way to become a successful trader. Now attach Heikin-Ashi to a daily chart. Look for the candle to change its color. Once the color has changed look if price has bounced from support or resistance level. When you have those two conditions met enter the market. Place your stop loss order a few pips behind the support or resistance level. What about taking profit? I believe it’s an art not a science. I personally take p
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Which Swing Trading Strategies Give You an Edge

Friday, August 27th, 2010

Swing trading is one of the most popular styles of trading amongst professional traders because they know that trading for the long term and not the short term is the only way to make consistent returns when trading any market. It doesn’t matter if you trade forex, stocks, precious metals or any other market, the only way to get a true trading edge is with a swing trading strategy. Here in lies the problem. What strategies are the best for a new trader if they want to embark on a trading career. There are two basic styles or strategies for how you can implement this style of trading. The first is to be a trend trader and the second is to be a counter-trend trader. Neither of the two are right or wrong, as you will need to practice with both of them to see if one is more suitable than the other.

Swing traders that go with the flow or the market trend are the most dominant traders. Why is this strategy the most popular? What does going with the trend offer that other strategies don’t? Trading with the trend greatly increases your odds of entering into a winning trade because you are following the smart money. It is believe that the smart money knows where the trend is going. Since the majority of money made in markets is by those who know the direction or the trend, it makes sense that if you know where the smart money is going you should probably follow it. By doing this you will see your ratio of winning trades increase significantly. The common tactic employed by trend trading swing traders is that they wait for price to finish any retracements or pullbacks and then they enter into the market just as price continues on with the trend and performs its next swing. This way you get in at a good price and are going with the flow of the market, increasing your chances of having a winning trade.

If you like to live life on the edge or don’t mind a little risk, then counter-trend trading is also an alternative swing trading strategy. This strategy takes the opposite approach of trend trading and a trader will enter the market against the trend. Just why would they do this? Counter-trend trading can prove to be very profitable, provided you know when and where the market is going to turn and retrace or pullback against the current trend. Entering into the market works in a similar way as trend trading. You must find a point in the market where price is exhausted or appears to be stalling and losing momentum. You would enter at this point because it is expected that price has run out of steam and is about to go against the trend and retrace. This strategy can take some time to master and is much more difficult to implement.

Two of the most popular swing trading strategies are trend and counter-trend trading. Swing traders that trade with the trend typically enjoy a higher ratio of winning trades as their trades are going with the flow and face a much lower chance of entering into a bad trade. Counter-trend traders typically have a higher loss ratio but their trades can prove to be extremely profitable thanks to entering the market just before major pullbacks or retracements. Which strategy works best for you will require you to test and practice with both to find out what is suitable to you as a trader.

To learn more about learn how to swing trade, visit the swing trading website to gain an edge with swing trading strategies over other market players and put yourself on the path to trading success.

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FREE Day Trading Strategies to Consider

Thursday, August 26th, 2010

www.ForexAutopilotRobot.com – FREE Day Trading Strategies to Consider – Even if you’re new to options trading, you’re probably already familiar with buying puts and calls. These are the two most basic options strategies and the ones that rookie options traders gravitate to. That makes sense. Puts and calls are low-risk and easy to understand. Buy a put and you want the underlying security to go down in value. Purchase a call and you’re cheering for the underlying security to rise. Either way, you’re risk exposure is limited to the premium you pay to buy the contract. If the contract expires worthless, you lose nothing more than the cost of the contract. To that end, we’re definitely fans of buying puts and calls, no matter what your level of options experience is. The potential for explosive returns without the need for betting the farm on each trade is unrivaled in the investing world. But we’re also fans of broadening our horizons and investing in options is one of the best places to do this. With so many different options strategies, there’s literally always a way to make a profit. Let’s look at the top 10 options strategies. 1. The Covered Call Writing options means we are sellers of an options contract, which can be risky under some circumstances, but not with covered calls. In fact, covered call writing is probably the most conservative options-writing strategy because the contract you write is backed by your ownership of the underlying stock. Let’s say you own 500 …

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Swing Trading Strategies – Two Tips For Anyone Looking to Try Out Swing Trading

Thursday, August 26th, 2010

Swing trading is the absolute best trading strategy or style when it comes to currency trading or any other kind of market. Traders have a wide variety of different strategies available to trade markets with but none come close to offering the same kind of high rewards with minimal risk that swing trading does. This doesn’t mean that swing trading is a fool proof style of trading, but what it does mean is that a trader is giving themselves the absolute best odds of pulling the trigger on a winning trade each time a trade is placed. If you would like to try your hand at swing trading then there are two important factors that must consider before deciding which market to trade and how to swing trade it.

The first thing any swing trader must do is ensure that the market or instrument they want to trade shows a higher tendency to trend than not trend. What does this mean exactly? Since this style of trading takes chunks out of market swings, the best markets to use with this style are ones that trend in much more natural and smooth ways. Not all markets behave the same way and you will find that some seem to never trend and others are too erratic and jump around all over the place. The easiest way to check if an instrument trends well or not is to open up a four hour to daily chart and take a look at the past several months of price action. If you notice price moving up and down in a seemingly fluid manner with visible swings in price action, then there is a good chance that you could swing trade this market. If you notice that price haphazardly jumps around or goes sideways with no visible market swings, then you’d be best off skipping this market and looking for a more suitable one.

The final factor is that of trading with the trend. Swing traders are trend followers by their very nature and this is something that many new traders are not comfortable with. One of the main reasons for carrying out the previous trend check on the instrument you want to trade is because not only does swing trading require price to makes swings up and down but traders of this trading style are mainly considered trend followers. You stand to make much more in the long run by going with the trend and not against it. It sounds simple and it is something that all traders are aware of but you may be amazed at just how many are unable to follow this simple rule.

Would you like to know more about swing trading? These are just two tips but many more are available at this website dedicated entirely to swing trading. Would you like to know how professional traders identify trends? Which indicators work best? Find out what the professional and bank traders around the world know about swing trading and trading in general so you can finally give yourself a true trading edge over any market with your own swing trading strategy.

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How to Enhance Your Day Trading Strategies

Thursday, August 26th, 2010

www.ForexAutopilotRobot.com – How to Enhance Your Day Trading Strategies – are there really day trading strategies that can be learned effectively and transferred from one person to another? Indeed, this is something that could happen though it isn’t able to be copied in a way that could be deemed a product. On the other hand, it would be more wise to look towards the trading strategey being the means of learning the alphabets of the performance of a trader. This sound may be a little heavy to someone. So, let’s make things a little easier for you to understand by breaking it down for you. Trading Strategies are based on a variety of factors. There are certain elements in the system that are permanent and do not change from one individual to another. Those that are knowledgeable in the realm of day trading will have developed their own plans and strategies that work to their own individual skills. The great learning experience will get definitely by such skills However, you can’t just take someone else’s trading strategies, copy them, and hope to get the same output. The system does not simply works in that way. Instead, it is preferable to turn to the methodology of successful trader and attempt to determine the thought process that went into developing such strategies trading. The significant use to have an insight into the basis of developing your own day trading strategies could be possible with this program. This allows for the potential to use your originally …

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3 DAY TRADING Strategies That Will Boost Confidence and Income!

Thursday, August 26th, 2010

www.ForexAutopilotRobot.com – Three Day Trading Strategies That Will Boost Confidence and Income! Some of the most important things to be aware of when trading are Tape Reading, Technical Indicators and basic Discretionary Trading Rules. Throughout this article I will explain these rules and how to use them. What are technical indicators? Used primarily by short-term day traders, technical indicators apply a specific formula to the price of a security. These ‘indicators’ look to predict future market direction by using previous price patterns. Examples of the most common technical indicators includes Moving Averages, Relative Strength Index, Stochastic, MACD and Bollinger Bands. Day Traders use these ‘indicators’ to identify specific times in the market when the opportunity for winning trades is the greatest. What are Discretionary Trading Rules? Discretionary trading rules are one of the most important aspects of consistently profitable day trading. Just like any business, you must have a business plan or a set of specific instructions on how to run your business. Everything from start-up capital, research and development, operational expenses and even the re-investment of your profits or the management of losses are included in this plan. Professional day traders use their rules like a road map to success, just like a small business owner uses the business plan they wrote. A disciplined use of this set of ‘rules’ results in a day trader taking only the trades that meet …

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2 Basic Strategies Investment In The Forex

Wednesday, August 25th, 2010

The two basic strategies of investing in FOREX are Technical analysis and fundamental analysis.

Most small and medium-sized investors in financial markets use technical analysis. This technique is based on the assumption that all information on future fluctuations in the market and a particular currency are in the range of prices. This means that all factors that have an effect on prices has already been taken into account and are reflected in prices. Therefore, what type of investor is essentially to base its investments on three fundamental assumptions. These are:

– The market movements incorporate all factors.
– The movement of prices is reflected directly tied to these events.
– History repeats itself.

Someone who uses technical analysis looks at the highest prices and lowest in a currency, the price of opening and closing, and the volume of transactions. This investor does not exceed finesse the market, nor does the main trends in the long run, but just look what happened to that currency in the recent past, and expects that small fluctuations generally continue just as it have done before.

Fundamental analysis takes into account the current situation in the country of the currency, including factors such as economy, political situation, and other related rumors.In terms of numbers, a country\’s economy depends on a number of quantifiable measures such as the rate of central bank interest, the level of unemployment, fiscal policy and inflation.

An investor can also anticipate that less quantifiable occurrences, such as the sick or the political transition will also have an effect on the market. Before basing all predictions on these factors alone, however, it is important to remember that traders must also bear in mind the hopes and expectations of market participants. As with any stock market, the value of a currency is largely based on perceptions and expectations about it, not only on its reality.

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Swing Trading Strategies – How to Find Profitable Swing Trading Strategies

Wednesday, August 25th, 2010

How can you identify a good swing trading strategy? Before you can begin to trade effectively, you must be sure and certain that the trading style or strategy you are using is one that gives you an edge or advantage over the market. Is this edge or advantage that can make the different between an extremely profitable trader and one that gives up due to suffering loss after loss. Are any swing trading strategies better than others? Are there any key points that a trading strategy must address to truly be considered good? If you can answer these questions, then becoming a profitable swing trader is within your grasp. Perhaps the best trading strategy for swing trading is one that utilizes the most powerful and unique aspect of swing trading. Any good swing trading strategy must take advantage of trends and use pullbacks and rallies to give a trader a chance to get into the market.

The most important element of swing trading is trend identification and trading only with the trend. In fact, this is true for any style of trading and any financial instrument or market. What makes a trend so important for swing trading or trading in general? It is widely believed and said that the smart money is the trend and by following it you stand to win more than you lose. While the average Joe is buying at tops and selling at bottoms, the smart money knows seemingly almost in advance where these tops and bottoms are and avoids them and the losses, unlike the average Joe. This makes sense then that the most reliable trading strategy is one that goes with the trend. Trading with the trend and not against it is the simplest way to gain a true trading edge while increasing your hit ratio. This sounds simple but amazingly many traders continue to go against the trend. They see opportunity in the market, or believe they do, and place trades without taking into consideration the current trend.

In addition to trend identification, any good swing trading strategies should take advantage of market rallies and pullbacks to allow traders to open and close trades at the most opportune times. Swing trading isn’t like other styles of trading where a trader may open and close multiple or hundreds of trades within a very short period of time. Generally speaking, swing traders usually wait for the market to retrace or rally before they enter the market. If a swing trader waits for rallies and pullbacks before entering a trade, they are able to enter at a price in the market which is in their favour. What makes this crucial? Getting into the market at a good price means you stand to profit more. You are entering the market at a price level that is in your favour. The average Joes all bought at the recent high, and are currently suffering as price retraces. The smart swing trading strategy, however, places the swing trader at the most opportune time of entering the market when price is retracing. The price the swing trader gets in at is much lower and cheaper than the average Joe. When the retracement ends and price continues on with the trend, the swing trader finds him or herself in profit much sooner than the average Joe. This simple strategy of waiting for a rally or retracement before entering the market can make the difference between a winning and losing trade.

Swing trading strategies are all about entering in the direction of the trend and entering a trade at a time where price is in your favour. Swing traders manage to do this by waiting for price to retrace before it continues on with the main trend.

For more inside information on swing trading and how swing trading can be used in any market, visit the swing trading website today.

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