Home Trading Strategies Proven Forex Trading Strategies That Work (for 2020)

Proven Forex Trading Strategies That Work (for 2020)

Proven Forex Trading Strategies That Work (for 2020)

Hey hey what’s up my friend so here’s the thing right I know that there are so many trading strategies out there systems right and it can be overwhelming for you as a trader in which strategies do you trade which one do you focus on which strategies is best for you what are the pros and cons of all these different strategies there are a lot of questions you know in your head and I understand it so that’s why in today’s video I want to share with you right the four main types of forex trading strategies out there all right if you look at all the systems all the strategies it can be categorized into one of this four categories I’ll walk you through what is it how it works the pros and cons and how to decide you know which strategy is best suited for you so all this and more in today’s video ready let’s get started number one day trading so it’s a day trader right your goal here is just to capture the intraday volatility what do I mean by it so different markets right each day they move in different amount for example right now you wrote dollar tends to move about 55 people a day for blue chip stocks it tends to move about 1 2 percent a day so you can see at different markets right different instruments they have their own intraday volatility so as a day trader of those markets your job is just to trade to capture the volatility of the day so if euro dollar moves about 55 people a day as a day trader maybe you’re just trying to capture that 20 25 pips right out of that entire 55 tips on average that it does for euro dollar on a single day so that’s what I mean by capturing the intraday volatility and the way you do it is that usually get your bias on the higher time frame I’ll explain this one a little bit and as a day trader you typically trade off the 20 minutes timeframe and below and because of the fact that you are trading on the lower timeframe right markets tend to move faster because every candle is painter you know once every let’s say once every 20 minutes for 30 minutes time free once every 5 minutes for 5 minutes time free and it’s not possible right to be trading I want 4050 markets so that’s why I as a day trader you typically focus anywhere between you know 3 to 6 or 7 markets that’s about it that’s pretty much the most that you can handle in any one time so let me explain you how this our this day trading capturing the intraday volatility by getting your bias on a higher time frame let me show you how it works right so let’s say for example use New Zealand Swiss franc right let’s it is the daily time frame okay and you notice that this market let’s say assume right this is the current price section on the daily time frame you notice that ok the higher time frame the daily it’s in a downtrend market is at this area of resistance of muscala R and you have multiple price rejection right and this area of resistance so you have a downtrend and prices and resistance okay let’s give these two ticks so this gives you a bias right as a day trader is that you don’t want to be long at this point in time right because higher time frame the price is at resistance higher time frame the market is in a downtrend you’d want to be long you don’t we’ll be buying at this point in time and on top of it right the market has given you clues right that it’s rejecting higher prices look at the the wicked upper week over here in this upper week over here so it’s a day trader right using this information than you have right you want to shut the markets on intraday basis so what I’ll do is that you can go down to a lower timeframe to look for an entry so on the 15 minutes timeframe right let’s say solemn just so what you saw earlier on the entire time frame right the multiple price rejection is pretty much this whole section over here okay so as a day trader you let’s say you look you’ll notice that this market right now is forming a build up in this area of support okay just giving you a example right market is not for me build up at this area of support so you might be thinking okay higher time frame is in a downtrend prices at resistance this area of support is likely to break down so let me look for shorting opportunities all right maybe you can look to shut the breakdown of this swing low that might be one or maybe you can look for a retest of you know a previous support and resistance let me beat this one over here price breakdown then you have a retest of previous support and resistance this could be another opportunity to short so hopefully this gives you an idea to how intraday trader work right you get a bias on higher time frame and any time your entries on the lower timeframe and they usually get out their trade right before the session in before the day ends okay so this is what our intraday trading is about right what day trading is about at least fraud 3 or forex markets at least so the pros and cons right so for day trading if you are good you can make money on most months why is that is because as a day trader you have ample trading opportunities and you can be trading anywhere between your fifty two hundred times a month and if you have an edge in the markets right 15200 traitor is enough for your age to play out over time so this is why you can make money on most months and you have no overnight risk because you exit all your positions right before the day ends the downside to it is that day trading can be stressful it is stressful because you are watching the markets all the time right you’re glued to the screen and you’re you know always have to having to be aware of if there any potential news coming out anything that could affect your trades when it’s a big trading setup coming in yeah yeah okay and another thing to consider is that there is high opportunity cost in day trading right this is something that a lot of traders neglect for example let’s say you have a 100k trading account you make 5% a month on average in a year there’s about 60 great 60 K okay at the same time right you could have been working elsewhere full-time right making about five six thousand a month that’s also about almost you know fifty sixty thousand dollars a year similar to your day trading and never and chances are you’re working less hours and chances are it’s less stressful okay so this is the opportunity cost that you have as a day trader because if you are day trading you would fall call right an opportunity cost of you know working elsewhere or making an income via some other methods right so don’t forget to take into consideration the opportunity cost as well moving on swing trading and by the way if you’re enjoying this video so far hit that thumbs up button right so this way you know I know that you’re enjoying it and if you don’t like this video you hate it subscribe to my youtube channel so I have chance to convince you in future at hey my videos are worth watching so do it right now hit that thumbs up button and subscribe to my youtube channel the button is all below so moving on swing trading so it’s a swing trader what you’re trying to do is to capture one swing in the market just one move one wave just one view just one swing right so let me just illustrate to you what is one swing so there are a couple of ways this can we can work right so for example the market is in a range so one swing could be lets say by near the low right in the market move up one swing higher and exiting near the highs so this over here from here to here is one swing in the markets alternatively right the market could be in a trend right like this higher highs and higher lows so one swing in the market could be buying near the lows and exicting near the highs over here and this again is one swing now some of you might be thinking hey Raina how do I know where this this trending move might end right how do I know that well I’ll share with you a technique later to how you can actually predict right this this highs in a trending market but later on and as a swing trader you typically trade off the one hour time frame in a before I maybe the two hour or even a four hour time frame and because you’re trading off this higher time frame you can treat more markets because the chance right it’s only you know painted once every four hour for example on the forward time prick so you can train anywhere between 20 30 40 markets it’s possible so now let me share with you right how a swing trading looks like on a channel how I can actually you know soak up predict the end of the trending move in a trending market so let’s have a look at the this bond market the ten-year so you can see the over here or if you just pull out the 50 ma you know that this market is in a healthy trend market tends to don’t pull back towards the 50 ma tends to pull back to previous previous resistance note and support and then you know reverse from there so as a swing trader your goal is just to capture that one swing in this trending market this is one swing this is one swing this is one swing this is one swing your goal is just to capture that one swing right and the beauty of swing trading is that you don’t have to endure the retracement that comes along with it alright this retracement that comes along with it and this retracement that comes along with it so now how do you how do you know right ahead of time when this trending move is about to reverse right like for example how do you know it’s about to reverse at this heist how do you know it’s gonna reverse at this house okay so let me share with you a technique you want to use a tool called Fibonacci extension right just go to here write Fibonacci in this case is called the trend based feedback extension it’s a Fibonacci tool and what you wanna do is to in an uptrend right plot it from the swing low to the swing high get is the swing high plot it to the swing high and pull it back down to the swing low okay so let me just you Street how you throw it from the swing low to the swing high and down to this swing low over here again the reason why I give you some space apart because you want this this whole levels to be shown so once you’ve done it right you want to look right and you notice that there are three levels right the 127 the 162 and a 2.

0 okay let me explain to you how this numbers come about so what it does right this tool is that it calculates the distance from this swing low to swing high right this distance okay let’s say this distance it’s uh I think layman term you know it’s what is cm right let’s say is 10 cm 10 cm I make a call is in dollars in units whatever but let’s put it 10 cm so you know what it means so how you get the 127 extension it’s just a 10 cm x one point two seven two elastic ten x one point two seven two and you get this figure over here right this this video over here if you just it let’s say the distance here is 10 cm you multiply by let’s say one six one eight alright one six one eight that’s how you get this figure here and 10 cm x two right that’s what it is – you get this figure over here so I’m using 10 cm as an illustration or you can call it X can call it Y whatever so that’s how you get your figures over here and gives you this this different price projection so now here’s the thing right let’s mention right which level do you pay attention to so to be conservative right to have a higher chance of you know getting out with a profit you want to look to target the 127 extension that’s of the most conservative measure right 127 extension and if you want to give your tree a little bit more Li room to run right the one six one it is another possibility or 162 whatever you call it okay so this is a couple of techniques that you can use right to give you an idea to where the trending move might potentially end so again right let’s say now you let’s see somehow you you bought this this loss over here near the bounds of the 50 ma what you’ll do is just pick this tool swing low again to swing high pull it back to the swing low and in this case alright the price actually did I even retest back to the 2.

0 level but again there’s no way to tell you know where as you kind of reverse from the 127 the 162 or the 2.0 but generally the more conservative approaches between 127 and 160 – right so this is a technically and you can use try to to give you an idea to where you can exit the trade for so called maximum profit potential so moving on right another example it’s this one is more of a swing trading in a range market so if we look at this chart right at this point in time okay notice that this market is somewhat in a range right between these highs and this lows over here that market came and down into this area of support let’s say you had a buying opportunity to go long so as a swing trader where do you exceed the tree well this is a little bit different because now it’s no longer a trending market it’s more of a range market and in a range market as a swing trader you want to exit your trade right before opposing pressure comes in so now as yourself where will all posing pressure comes it where would the sellers come in and if you look at this chart if you ask me all right sellers could possibly come in with in this area over here right where previous support could become resistance all right so this is a possible area to look to capture one swing in the market right so in this case this would be your one swing right by from this lows and exiting near this high so they have this one this one swing okay so that is what swing trading is all about processing concern if you are good you can make money on most quarters why most quarters is because compared to day trading swing trading you don’t get as many trading opportunities so you need time for your traits to play out right so again if you’re good if you have an edge in the market you can make money on most quarters it’s possible to treat part time because you don’t have to be glued to the screen all the time for example if you trade off the forward timeframe you can just check the chance right once every four hour all right so you can treat it part-time the cons is that you won’t be able to write trends because remember as a swing trader you’re just gonna capture that one swing you’re gonna exit the trade before the opposite pressure comes in before the retracement comes in so this is why you’ll never write trends you have to embrace it and you also have overnight risk alright so you might be affected due to you know news impact and stuff like that so soon trading this is something to be aware of moving on right position pretty all right so what is position trading so position trading you can think of it it’s like you know trend following basically writing trends in the market so just uh sample right let’s say you’re writing train is like market in a range okay Danny breaks out trend trend trend trend trend any reverse right so you exit somewhere here after the market show signs of reversal when he has hit your trailing stop loss so this is what position trading is all about and as a position trader the key is to create many markets you have to trade many markets because there are times right where where market is not going to Train and if you just trade a few markets you’re gonna get stuck in those few markets and you know suffer a lot of whipsaw so you the more markets you trade right now oh that’s right you will you know capture a trend so you want to treat many markets and your time frame is daily and above if you can do it on a daily timeframe or even a weekly timeframe okay so this is position tree and the pros and cons right so before we talk about the pros and cons right let me just share with you an example right so one example is the dollar against the Chinese yen right this is a trending market actually and it’s so statistically this is a trending market I’ve done a back testing on it and you can see that this market right actually is in a potential accumulation stage over here right is range then you pretty much broke out of this resistance and it started trending okay so you can see that as a swing trader it’s unlikely you’ll be exiting your trade anyway even the nearly sighs I would say anyway here or maybe somewhere here right that’s one as much a student trader would go but as a position trader this is where you can capture a Creek right and one way to go about it is that you can use a tool like let’s say the 20-period moving average right exit the trade only if the price breaks or closed below the 20 ma which is somewhere here so this is where position trader can write this so-called entire trend right the entire so-called move right now just one move up multiple multiple moves right in the market so this is what position trading is all about ok so that is right and pokemons the pros and cons right is that it can be done in less than an hour already right reason being is you’re trading off the higher time frame like the daily or even weekly you don’t need much time probably doesn’t even interfere your full time job and it’s there’s really not much stress right it’s either there’s a trade there’s no tree or you’re just riding the train that’s pretty much it the downside is there it’s there’s a low number of trades because you don’t get trading setups often okay and you also have to be comfortable watching your wieners become losers because the market could break up you’re in the money and it does a sudden reversal back alright and becomes a fall to break out any hits your trailing stop loss and you get stopped up from a loss so it’s very common to what your wieners become losers and you gotta get okay this is the truth so that is position trading and one more technique is what most honest transition trading so this is a it’s something that I hesitated to put this in because this is more of advanced trading but still I I put it in anyway there are four traders who have been trading for a while now this is a trading style that you can consider what I call transition trading so the way transition trading works is that again you get your your bias on the higher time frame you time your entries on the lower timeframe just like a day trader okay but if the trade right or the market condition makes sense and the trick goes in your favor you can actually manage your trades on the higher time frame I’ll give you an example later again transition trading you typically focus only on a few markets and you a double multiple time frame perspective an example so if you look at this this one over here let’s say New Zealand dollar Guinea and again this point in time right you look at this again it’s kind of similar to the New Zealand Swiss franc one you saw earlier price is in a downtrend overall a higher time frame and resistance and multiple price rejection over here and let’s say you you know got an entry on a lower timeframe line D let’s say the 15-minute timeframe okay 15-minute time frame let’s say I don’t for whatever reason maybe you let’s say you had a shorting opportunity right let’s say you had a shorting opportunity at this previous support right now become resistant so you ensure when shot on this price projection okay so let’s look in deeper okay and also bear in mind that since you’re entering your tricks on the lower timeframe right your stops it’s also based on the lower timeframe so let’s say you went shot over here again right then stop-loss let’s say 180 are from this highs let’s say somewhere about here all in all your stop-loss is like what I don’t 10 12 pips right at the same time you know that on higher time frame market is in a downtrend and resistance and showing multiple price rejection this could be a move that could you know play out really well and let’s say you went shot over here and again of course I picked this chap directed to show my point of how transition trading work and in this case the market pretty much win in your favor I mean quite a bit right all the way down right at the same time right you have to be able to swallow this so color morph against you most probably a lot of traders will not be able to to solo this retracement so that’s why one tip to share with you is that as a transition trader let’s say you you shot one lot okay you don’t want to hold it one lot right and what your equity could go up and down for a full one long because it’s it’s a rollercoaster ride right you can imagine it at this point right maybe you’re up like you know two or three are on the tree and market grievers you are back to break even close to break-even so this is why one technique that a transition trader do is that when the market moves one are in your favor one to one is reward ratio it would exit may be a turn or half the position so the remaining half are is so called technically in the risk free trader I could unquote risk-free and you will let the remaining half right for as long as possible they will let the remaining half right manage it using the higher time frame analysis using higher time frame a market structure so for example let’s say you went shot at this point okay and you took a 1 to 1 let’s say somewhere near this swing low you have the remaining half writing and your remaining half rate could be drilling in a main engine on a higher time frame right like for example you know that on the higher time frame price is approaching this swing low over here maybe you can take the last remaining half and this this swing low over here can you see our transition trading works or you time your entries on a lower time frame and if conditions permit right market moves in your favor you can use the higher time frame right to take profit right and this gives you a very favorable risk to reward on your trade and that’s what transition trading it’s all about right basically timing your entries on a lower timeframe and managing your traits on the higher time frame so pros and cons right you can achieve insane risk to reward on your trip possibly one to ten or more and reason being is that your your stop-loss right is tight because your timing your entry on the lower timeframe the downside is that most rates will amount to nothing right you hit your one to one on the position for half of it and remaining half just get stopped on and breakeven or for loss so more streets are just like your scratch trades right like small wing smallest amount of nothing but the few right are those that really will make a huge difference to your bottom line and another thing is that it’s mainly for experienced traders because you can see that you are utilizing multiple time frames analysis you’re utilizing you know multiple time frames trading techniques together in for example this one is combining over day trading and swing trading together to give you this transition training okay so which trading strategy should you go with right the question is right so the first question to ask yourself is that do you want to grow your wealth or make an income from trading so there’s a difference when I talk about growing your wealth from the markets or it means lawmaking you know 10% 15% a year right that’s growing your wealth making X percent a year but when you talk about making an income from trading right it means could be you know you’re looking to make light you know three to four percent a month or maybe a five or six percent every quarter so you’re looking for some consistency so if you want to grow your welfare in the markets right you can adopt either swing opposition trading approach but if you want to make an income right that’s where you need to look at day trading or transition trading okay number two how much time can you devote to trading right if you just crazy you want to do this full-time think clearly right day trading it’s for you but if you are having a full time job you don’t want to do this full-time then a you’ve got to look at you know swing trading or position trading if you want to least amount of time position trading if you want more action in the markets by the same time right don’t want to be glued to the screen then swing trading and if you want to do it full-time day trading and totally right that’s the strategy suit you so for example position trading right I mean it’s awesome right – right big trends but maybe you’re not suited to right the trends because you’re not comfortable in watching your winners become losers right you feel a lot of pain right when those winners become losers or I mean those green become rich and if you feel a lot of pain then you might consider you know swing trading where you just look to capture one swing in the markets so again right as yourself right that’s the strategy soon you that’s do you exert a lot of mental capital do you feel a lot of pain psychologically when you execute a strategy if it doesn’t really hurt you if there’s really not much pain then let strategy probably is for you but if you feel a lot of pain that strategy clearly isn’t for you right simple so as a quick recap today we have talked about day trading right basically capturing the intraday volatility we talked about swing trading capturing a swing in the markets we’ve talked about position trading writing trends in the market and transition trading which is a combination of you know multiple trading stalls together and for those of you who want to learn more about this type of you know trading techniques right on how you can actually read the price section of the markets how to better time your entries and exits right what I want you to do is go down to my website ok where I have a book for you right ebook right trading with Rainer calm scroll down alright so depending what you want if you wanna learn how to better time your entries and exits reading price section download this book over here and the ultimate guide to price action trading if you under learn how to write trends in the market like position trading and trend following is for you click this orange button then I’ll send it to your email for free right so just go down to my website trading with Rainer calm download these guides is free and enjoy so with that’s it I wish you good luck and good free if you’re enjoying this video hit that thumbs up button and subscribe to my youtube channel button is below and I will talk to you soon you


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