justforex
Member
Forex is attractive for the opportunity to earn the additional profit on it in a relatively short time. However, in order to succeed in the market, it is necessary to develop a clear scheme for concluding transactions, the so-called Forex strategy. It is your personal set of rules for entry and exit from transactions.
The main condition of any trading strategy is the number of profitable trades to exceed the number of unprofitable one's several times. And now let's get acquainted with types of Forex strategies.
Types of Forex Strategies
A type of strategy is determined by the duration of holding open positions. The optimal time to hold an order is usually defined by the objectives of a trader, market conditions, the forecast. In accordance with the duration of holding an open position, all strategies can be divided into three groups.
Long-term strategies. In this case, an open position can be held from several weeks to a year. This allows you to monitor the market in a relatively quiet mode, without worrying about the current state of the transaction. Such strategies can be used by both novice and experienced traders with a conservative trading style who want to get a small but stable result.
Medium-term strategies. Usually built on the basis of technical analysis, positions are kept open from one day to two or three weeks. One of the conditions for applying a medium-term strategy is the presence of an active trend on the market, which provides relatively safe trading.
Short-term strategies are the most profitable, but also the riskiest because trading takes only one day and it is sometimes difficult to predict price movements. Short-term strategies include “scalping” and “intraday trading”.
Scalping. Such strategies involve the opening of 100 or more transactions per day, the profit from which is minimal, and high profit is achieved due to the huge number of transactions. The duration of the transaction can be from a few seconds to several minutes. Scalping is considered to be one of the most difficult types of trading.
During intraday trading, the transaction is opened and closed within one day and has a duration from 15 minutes to 4 hours. The number of transactions per day with such strategies does not exceed three to five, so the “intraday” is considered to be less risky than the “scalping”. Intraday strategies are fairly simple and can be used by novice traders.
Top 3 trading strategies on Forex: simple and reliable
London Session
One of the easiest strategies on the Forex market. Trading time – a session on the London Stock Exchange, starting at 10 GMT+3; trading timeframe – 30 minutes. It is better to apply it to currency pairs including a British pound.
According to this strategy, entry into the market is made daily, but only once a day. The signal to open a trade is the first closed candle, a pending order to buy is placed at its maximum, and a sell one – at the minimum. The stop loss is based on which order is open, also at the high or low of the same candle. After the order is open and the price has passed 15 points, one should open an order in another direction. The second pending order is not deleted, if the price turns around, the trader will still earn or go to zero. NOTE! If the important news is released on the day of trading, then beginners need to refuse to open deals.
Moving Averages
The strategy is applied for any currency pairs; for its implementation, a trader needs to build on the chart two moving averages – one fast, with a short period that will be close to the price and react to its small changes, and the second one should be slow, with a large time period. One should pay attention to the type of intersection of these moving averages. When the fast one crosses the slow one bottom-up, you need to buy, and when the top-down – to sell.
Quick profit
The strategy belongs to scalping and is suitable for any currency pair. The best time to apply the strategy – the opening of trades in New York and London. An order to buy or sell needs to be opened when the price crosses all EMA (exponential moving averages) charts. Moreover, if the price crosses the EMA from the bottom up, this is a signal to make a purchase. Take profit is recommended to set no higher than 10 points, since the price may turn around. One should open an order in another direction immediately after the price has moved away from the opened transaction.
So there is a huge amount of trading strategies on Forex. We showed you just some of them. You should choose the strategy that will suit you and bring you profit. Good luck!
The main condition of any trading strategy is the number of profitable trades to exceed the number of unprofitable one's several times. And now let's get acquainted with types of Forex strategies.
Types of Forex Strategies
A type of strategy is determined by the duration of holding open positions. The optimal time to hold an order is usually defined by the objectives of a trader, market conditions, the forecast. In accordance with the duration of holding an open position, all strategies can be divided into three groups.
Long-term strategies. In this case, an open position can be held from several weeks to a year. This allows you to monitor the market in a relatively quiet mode, without worrying about the current state of the transaction. Such strategies can be used by both novice and experienced traders with a conservative trading style who want to get a small but stable result.
Medium-term strategies. Usually built on the basis of technical analysis, positions are kept open from one day to two or three weeks. One of the conditions for applying a medium-term strategy is the presence of an active trend on the market, which provides relatively safe trading.
Short-term strategies are the most profitable, but also the riskiest because trading takes only one day and it is sometimes difficult to predict price movements. Short-term strategies include “scalping” and “intraday trading”.
Scalping. Such strategies involve the opening of 100 or more transactions per day, the profit from which is minimal, and high profit is achieved due to the huge number of transactions. The duration of the transaction can be from a few seconds to several minutes. Scalping is considered to be one of the most difficult types of trading.
During intraday trading, the transaction is opened and closed within one day and has a duration from 15 minutes to 4 hours. The number of transactions per day with such strategies does not exceed three to five, so the “intraday” is considered to be less risky than the “scalping”. Intraday strategies are fairly simple and can be used by novice traders.
Top 3 trading strategies on Forex: simple and reliable
London Session
One of the easiest strategies on the Forex market. Trading time – a session on the London Stock Exchange, starting at 10 GMT+3; trading timeframe – 30 minutes. It is better to apply it to currency pairs including a British pound.
According to this strategy, entry into the market is made daily, but only once a day. The signal to open a trade is the first closed candle, a pending order to buy is placed at its maximum, and a sell one – at the minimum. The stop loss is based on which order is open, also at the high or low of the same candle. After the order is open and the price has passed 15 points, one should open an order in another direction. The second pending order is not deleted, if the price turns around, the trader will still earn or go to zero. NOTE! If the important news is released on the day of trading, then beginners need to refuse to open deals.
Moving Averages
The strategy is applied for any currency pairs; for its implementation, a trader needs to build on the chart two moving averages – one fast, with a short period that will be close to the price and react to its small changes, and the second one should be slow, with a large time period. One should pay attention to the type of intersection of these moving averages. When the fast one crosses the slow one bottom-up, you need to buy, and when the top-down – to sell.
Quick profit
The strategy belongs to scalping and is suitable for any currency pair. The best time to apply the strategy – the opening of trades in New York and London. An order to buy or sell needs to be opened when the price crosses all EMA (exponential moving averages) charts. Moreover, if the price crosses the EMA from the bottom up, this is a signal to make a purchase. Take profit is recommended to set no higher than 10 points, since the price may turn around. One should open an order in another direction immediately after the price has moved away from the opened transaction.
So there is a huge amount of trading strategies on Forex. We showed you just some of them. You should choose the strategy that will suit you and bring you profit. Good luck!
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