Coin Trend
Coin Trend Are you an "Obama zombie"? There has been a new term coined for the Obama lovers and Democrats now. They're called "Obama zombies". There was a hint of this during the Obama campaign, ...
Coin Trend
Forex Trend Following - Which Method is Best for Bigger Profits
If you are a Forex Trader you need to trend follow -there are however different time frames you can trend follow in and here we will look at the three most popular.
We will look at the merits of each, your chances of success and the best method for your personality, so let’s get started.
Day Trading
Fact: The data within a day will not allow you to get the odds in your favor as the time period is to short – you may as well flip a coin.
Support and resistance levels are simply not valid and volatility can and does, take prices anywhere. In
short, all these short term moves are random and that’s why day’s traders lose.
Think about it:
There are millions of traders, trading several trillions dollars daily and what they do cannot be predicted in a period of hours.
Many vendors appeal to the greed of buyers - they make money from selling their forex trading system and the trader loses in the market.
You will see lots of claims and even a track record but that’s done in hindsight knowing the closing prices!
They never have a real time track record of forex day trading success and you should avoid Forex day trading at all costs.
Swing Trading
The aim here is to catch reactions within major trends which normally last around a week and it’s a great way of trading especially for novice traders.
Swing trading forex trends is exciting, there are plenty of opportunities and you know if you are right or wrong quickly – this makes it easy psychologically.
The key to successful swing trading is always to CONFIRM With momentum indicators - before executing a trade.
Do NOT simply buy into support or sell into resistance see the change come first before you enter the market – do this correctly and it can be very lucrative.
Long Term Trend Following
The most profitable form of trading and also the hardest to master not from the point of view of method - but from the point of view of adopting the right mindset.
If you look at Forex charts you will see Forex that last for months or even years yet, only a small minority of traders have the mental discipline to hold these trends and realize their full profit potential.
Forex trend following requires patience and discipline and it’s hard to acquire as most traders are simply not mentally strong enough to accept big gains.
Of course all traders want big gains but accepting them is the hardest bit.
Let’s look at why this is in more detail.
If money is important to you, then your emotions will be present and they will hinder you in your quest to hold these trends.
When counter trend moves come (which they always do) they will eat into your open equity and the losses in open equity can frighten you to take profits early.
Most traders get excited and nervous when they get a profit and the bigger the profit gets the more tempted they are to bank it before it gets away.
They end up banking early and getting a mediocre or small profit when they could have had a large one.
You need to keep your eyes on the longer term profit you are going to bank and accept that you will have to see dips in equity (sometimes of thousands of dollars in the short term) and simply ride them out.
So which method is best for you?
Well we have already said forex day trading will simply see you lose so that’s out so the choice is swing trading or long term trend following.
You can mix both or if you feel you have the right mindset focus on long term trend following and if you don’t feel you can face the large dips in open equity go for swing trading which is the perfect place for novices to get their feet wet.
If you do both correctly you could make some huge forex profits and enjoy currency trading success – Good luck!
About the Author
NEW: FREE Trader PDF'S - Forex Profits Alerts and Much More
On all aspects of becoming a profitable trader including: Free critical trader reports, weekly and dailynewsletters, and updates on the best high reward trades via Forex Trading Alerts visit our website at:
http://www.learncurrencytradingonline/index.html