Unique Forex Trading Strategies That Work
One of the most important aspects of Forex trading is discipline. This is a virtue that all traders need to practice to avoid making improper trades and getting caught off guard by the ever shifting market. The fact that the market is constantly changing tends to excite the ‘risk-taker’ within most people. The one sure way to ensure that you maintain your discipline and actually get profits from your trades is by strictly following a particular Trading Strategy. A few good ones are discussed here.
- Forex News Trading Strategy
This is quite the lucrative business depending on which side of the divide you fall under. This Forex Trading strategy provides the trader with a unique perspective to risk events and how to trade in them. It relies on the volatility that accompanies the release of news. It seeks to exploit the divergence between the actual news data and the message relayed by the technical indicators. In case the fundamental data is leaning towards a rise in the currency pair, but the technical indicators point towards a drop, then the signal to trade will be triggered.
- RSI Stochastic Divergence Strategy
This is a Forex Trading strategy that makes use of a number of technical indicators. The indicators are used to direct a trader towards the best possible trading opportunities. The Stochastic Indicator in this strategy is used in spotting the hidden divergence. This makes it a far more formidable tool than the use of the classic convergence and as such, it offers the trader an edge. The determination of the trend direction is done using the twenty and the fifty moving average crossover system. The RSI indicator is used to offer additional information, only triggering the trade once it passes above or below the fifty line. It can be applied to a large number of short time frames, ranging from the one-hour frame to the daily frame.
- Bollinger Bands and Stochastic Strategy
This is a revision of the Mean Forex trading strategy. Unlike its predecessor, it can offer the trader some essential trade steps where the risk is quite minimal while evaluating this against the potential gains. The Bollinger Bands are used in the measurement of the standard deviation which is usually the degree of the volatility of the market. The Stochastic indicator, on the other hand, is used to make a determination on the price points that have been potentially oversold or overbought and can cause a marker reversal. The best times to implement the Bollinger Bands and Stochastic Strategy is on a five-minute chart. This also doubles it as a perfect scalping strategy.
These are but a few of the Forex Trading Strategies that Work. You can use to get a sizable profit on your trade. The strategies discussed here are mostly short term, but there are also some excellent strategies for people looking to make long term buys. It is good to remember that there is no miracle strategy which is full proof and devoid of loss. Every strategy has its merits and drawbacks, so choose carefully depending on your needs.