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Surely as a beginner trader you are looking for the super winning Forex strategy that will produce profits with your trades. Let me tell you right from the start, this super strategy does not exist.
When it comes to trading, success is not a guarantee. What may work for someone else can be a disaster for you. On the contrary, if someone else discards a Forex strategy, maybe it could be the best for you.
Therefore, testing is necessary to discover the Forex strategies that work. Vice versa, you can discard those that don't work for you. Even after a lot of experimentation, the market may not go as you thought, and your strategy still studied and analyzed, may not give the expected results.
Trading strategies
Technical tools
The technical analysis depends on the graphs and takes one of the postulates of the Dow theory as a premise: the market discounts everything. Any factor that has an impact on supply or demand will be reflected in the price, and therefore, according to technical analysts, this will appear in the charts. The price action.
As we all know, charts are made up of axes that represent time and price. Price action appears on these charts, waiting for you to interpret it, regardless of your trading style (long-term positional or short-term intraday), but it all starts with studying the charts and price action on them.
It is crucial to keep in mind that for each trader, the same chart can show different patterns, thus producing opposite signals. It demonstrates the imperfections of this method, which is more of an art than a science. Follow the trend.
Fundamental tools
Fundamental analysis, unlike technical analysis, focuses on the underlying forces that influence supply and demand as the main drivers that drive price.
Fundamental analysts say that markets may incorrectly value a financial instrument in the short term, but that in the end this error is always "corrected". The fundamentals at work in the Forex market.
Trading Strategy - Supports and Resistances
Supports and resistances are a vital element when making a good trading strategy. We can say that the levels of supports and resistances represent the tendency of a market to bounce off previous highs and lows.
Support is the tendency to rise from a previous low. Resistance is the market trend of falling off earlier highs. It occurs because market participants tend to judge the current price relative to prior highs and lows.
CFDs – A Simple Way To Trade The Markets
Since an effective trading strategy is simply a sum total of rules and conditions that help make a decision, traders can speculate on rising and falling prices without owning the underlying asset.
One of the most popular ways is through CFDs or Contracts for Difference. Trading CFDs is useful for most of the trading styles. Shortly, this is used for trading freely without owning the underlying asset or acquiring any rights or obligations in relation to the underlying asset. It is a plus for the trader.
