Trade with the trend.
Trading with the trend is one of the most common and safe forex, there is nothing easier than to make a deal in the direction of the mainstream, and wait for the profits to reach the target level. But everything is simple at first glance, because the trend is not moving in a straight line, and is quite difficult to choose the direction of the transaction.
In addition, should take into account a host of other parameters that characterize this trend, the most important of them is the strength of the current trend, how long it can last and what caused this movement.
Just do not forget that for any of the time periods there is its direction, which can simultaneously be back for a longer timeframe. It is about the trend of trade features we discuss in this article.
First of all would like to focus, why not trade against the trend. The main reason for loss of such transactions is the end of the correction and the price reversal in the direction of the main trend. The trader does not always enter the market at the beginning of a rollback and not always correctly estimates the size of the resulting correction. Therefore, the security of transactions is desirable to trade only with the trend.
The direction of trend.
This indicator should be viewed only by analyzing the direction of price movement on several adjacent time frames, but in this case it is possible to avoid mistakes.
For example, take the time intervals in M15 and M30 to M15 – there is a downward trend, while the M30 is up, in this case, with high probability we can say that the 15 minute time frame, there is a correction of price in relation to the M30 and it is advisable to refrain from opening the transaction.
The best option to enter the market when trading with the trend would be if on the M5, M15 and M30 there is an upward trend, in this case, boldly, opening the deal to purchase.
The truth is there are no rules without exceptions, the opposite price movement over a shorter time interval and may indicate the beginning of a reversal. Therefore, in order to avoid mistakes it is best to use forex technical tools such as trend indicators.
In practice, it is trend trading allows you to get the most profit as a result of long-term deals, because you take the maximum range of movement of the price, but before you open an order, always produce market analysis and forecast of its future behavior based on the fundamental and internal factors.
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