Forex Trading Solutions

Forex Trading Solutions

Forex Trading Solutions
Forex Trading Solutions

Forex Trading Solutions means that successful forex traders are constantly aware of market movements and they monitor all trend lines on all time frames. Why? Because the trend in one time frame is not your friend in another…”the trend is your friend”, is a very relative statement and needs to be qualified by looking at all the time frames… because the movement on smaller time frames will always respond to the trendlines on larger time frames.

This means, if the market is retracing back down toward an upward trendline on a daily chart, that retracement on the daily chart may be a 200-pip move. A 200-pip retracement from a daily chart will be a downtrend movement on a 60-minute chart. If you only look at the 60-minute chart to do your analysis, you will be in a strong downtrend and your bias will be bearish. You will probably enter the market bearish.

However, the way Murphy’s Law works, you will be entering at the end of that 60-minute trend because as soon as the market from the daily chart hits its trendline, the 60- minute chart will reverse and begin to rally and you will be sitting there scratching your head while you lose money wondering what happened.

So, the trend is your friend, but only if you are trading in the direction of the higher slower time frame… anything else in a faster time frame is just a retracement and not the true trend.

Yes, you can trade the retracements which is a shorter play and still make money… it’s actually one of my favorite ways to trade, but you have to know what you’re doing… you need to be able to see the faster trends in relationship to the slower trends… you need to recognize easily that the retracement is a shorter trend in the overall longer main trend.

One of my color coded trading systems uses colored boxes that are the daily time frame….this is considered the main direction for day trading or short term swing trading. The colored boxes can be adjusted to work for longer term swing trading or even for scalping.

People trade according to their personality. Aggressive people love to scalp, while passive people love long-term trading.

Figuring out your trading style is very important to do before you begin to trade.

However, whether you are a passive trader or an aggressive trader, you need to be able to determine market direction before you trade. You need to learn how to find the current major trend before you enter the market because you need to trade in the direction of the major trend at all times. Do not fight the major trend. Fighting a trend is like trying to swim upstream in violent, forceful rapids. It doesn’t work!

“Traders can make many mistakes. The biggest mistake is trading in the wrong direction! ”

Forex Trading Solutions

Click to visit Cynthia’s Color Coded Trend Trading website to learn more about forex trading on the MT4 trading platform.

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