Foreign exchange trading is as much an art, as it is a science. It is often based on the intuition of the traders. The basic forex strategies allow traders to gain insight into forex trading. Refined knowledge and proper insight can help gain an edge in the market. Instincts also play a vital role in the trading business. Trading strategies are based on two basic denominations. First being the ability to decipher the indicators and second, being able to assimilate chart patterns. Basic forex strategies help traders gain an understanding of future trading and the challenges which might be faced. These strategies can be understood and applied quite easily and with time allow traders to have better decision-making capacity.
There are five popular strategies in this category:
TDTL- Tom Demark Trend Lines Forex Strategy:
This strategy is based on price projections using trend lines to plot indicators. Traders initially used to draw these trend lines manually. Trend lines are accurate and very useful in providing a bird's eye view of all the indicators in consideration. The catch however, is being able to draw the trend lines correctly and use them properly.
Simple Candlestick Patterns Forex Strategy:
This is another profitable trading strategy. Three things have to be kept in mind while using this strategy however. Firstly, you cannot use higher leverage as that will raise risk and chances of higher failure. Secondly, never go against the trend. The market trend will serve as the path to follow and traders should follow the market trends closely. Thirdly, never shift from the system. Traders need to stick to the trading methods to avoid making mistakes in forecasting and trends. The buy or sell decisions need to be as well-placed as possible and fluctuations need to be regularly monitored.
Brain Forex Strategy:
This system has many features that are quite useful for traders. One such feature is that it helps traders optimize their trading at certain levels. The optimal market prices are indicated by the stops in the system, making it easier for optimization. Traders find great ease in using this system in making timely and efficient decisions. The system is highly responsive to the changes in the market and its trends.
Simplification Forex Strategy:
Forex trading is not an easy job. It is made even more difficult by the fact that there are numerous indicators that need to be taken into consideration. The result can be confusion and stress from deciphering each indicator separately. This strategy allows the simplification of these indicators and provides an easier way to translate the view of all the indicators. It is simple yet profitable.
Step MACD Forex Strategy:
This strategy allows traders the option to combine two indicators and then the system itself will indicate the trends and assist decisions. It will indicate the safe zones to sell and the danger zones to sell. It is another way of optimizing the buying and selling decisions while keeping the graphs and charts as simple as possible. Each strategy has its advantages and disadvantages. The trader's comfort level defines how well he/she can adjust to a certain strategy and it also requires some skill and insight on part of the trader.