Developing a forex trading strategies that work. Find a good, effective & reliable forex trading strategy that suits trader’s style. A beginner in FX trading might become interested to find out the reliable, accurate and effective trading strategy.
In this short article, it will guide a trader how to really develop a reliable, accurate and effective forex trading strategies that fits trader’s style. So, let’s get started to find out.
Forex Trading Strategies – Developing a Reliable & Effective One
A. Knowing Your Forex Trading Style
You might want to become a day trader, swing trader, trend follower, scalper, etc. Of course, not all trading style are suitable to your preferred or ideal lifestyle.
- If you want to trade less and do more in your daily lives, then try trend follower
- If you have a day job and want to trade once a day, then choose your style above
- If you want to spend a lot of time in front of your chart, then scalp.
- etc…
B. Accurate Indicators Means a Lot in Forex Trading
If you choose to use one simple indicator and you found it effective, then use and stick to it. Other traders tend to use many indicators to screen a great signal to trade. However, a KISS trading strategy will work than anything else (indicators).
KISS – Keep It Simple Stupid!
A more simple indicators and reading Japanese Candle Sticks may work if you know what you’re doing. Some profitable traders just use stochastic oscillators and read Japanese Candle Sticks. Some professional traders just the candlesticks alone showed in their chart.
C. Back Testing Forex Trading Strategies in Demo Account
It is okay to test different forex trading strategies to know what is effective and what is not. If you will use simple moving average with a parameters of 50 EMA and 200 EMA, and to look for crossovers for entry trading signals, then test it at least within a month or two before you change another strategy.
Forex Trading Indicators
- Moving Averages
- Stochastic Oscillator
- MACD
- Relative Vigor Index RVI
- RSI Relative Strength Index
- etc…
You can combine at least 2 or three. But of course, KISS is the best. Keep it simple stupid! After you back tested the strategy and you found it effective, then try in live account.
This time, trading on demo account and live account has big difference. A forex trading strategy in demo account may be effective but when you tried in in live account, it was not effective or reliable.
To Develop a Reliable Forex Trading Strategies, you should know first what is “reliable” all about…
- consistently good in quality (giving profitable results) or trading performance; able to be TRUSTED.
- giving the same result on forex trading successive trials, test in demo or live account..
You can’t develop a reliable and effective forex trading strategy in just an hour, a day, a week or a month. It takes a year or two to find a good and reliable forex trading strategy that will help you become a profitable forex trader. Reliable simply means trusting a forex trading strategy. How can you trust a strategy if you just used it once, twice not thousand times. You may only know if a forex trading strategy is reliable and effective if tried it many times and doubled your trading account balance many times as well, right?
Tip: Do practice discipline, change your strategy at a time. Or just develop your chosen strategy, find out what went wrong why you became not profitable, stick to your strategy but change your attitude using your strategy! Anyway, forex trading is just a matter of self disciplined. So pick at least one of the many forex trading strategies, use it many times, develop it, master it until you become a millionare forex trader.
Disclaimer: This forex trading article is not a professional advice, it is use for informational purpose only. Trading forex, options, stocks and cryptocurrencies is associated with high risk. Capital in trading might be at loss, so be aware!
Good luck in your forex trading journey. Always visit Daily Investing Tips at www.InvestmentTotal.com for more useful articles about forex trading, stocks trading and cryptocurrency trading!