Currency trading which is often known as forex trading is very much popular in today’s world. Most of the retail traders consider trading as their best alternative source of income since the market offers extremely lucrative opportunity. But not everyone can truly understand the nature of this market. The market follows its own pattern and moves along the trend. The expert Aussie traders spent years after years to develop a perfect trading system to execute high-quality trades in favor of the trend. Unlike the expert, the new traders execute random orders and ultimately blow their entire trading account. Being a currency trader you can earn as much as you want and you can also lose all your hard earn money in the blink of an eye. Success in this industry is very hard and you need to educate yourself and follow proper trading discipline to make a consistent profit. Though the success rate is extremely low in this industry yet you can easily follow three technique to make a consistent profit.
Daily time frame Analysis
Trading the daily time frame is very much popular among the day traders. Even the long term traders at Saxo often consider it as the best time frame to do the technical analysis. Being a currency trader you need to find the existing trend using the daily time frame and based on that data you should trade the major support and resistance level. Some novice traders often trade the minor support level in the lower time frame but it will ultimately cause a huge amount of loss. Though daily time frame is very much popular yet some traders prefer the 4-hour time frame since trading signals occur much frequently. But when you trade the 4 hour time frame you need to do the multiple time frame analysis in order to filter the false signals in the trading platform.
Trend trading strategy
Trend trading strategy is little bit complex yet very profitable. Instead of using tons of indicators you need to learn the perfect way to draw the trend line. Always make sure that your trend line has minimum three connecting points and you should never force join the trend line. Once you find the trend line place your trade in favor of the trend with proper money management. Some advanced traders often use the price action confirmation signal to place their trade at the trend line support and resistance level. Trading with the price action confirmation in your signal will increase you winning edge to a great extent. Some novice traders even get carried away by seeing the success rate of this trading strategy and takes a huge risk. But trading is all about managing your risk. There is nothing to gain by executing the high-risk trade. You will do fine as long as you follow the trend and trade with proper money management.
Fundamental analysis is very crucial in Forex trading. The expert traders always do the fundamental analysis along with the technical analysis to make high-quality trade execution. At your initial stage doing fundamental and technical analysis will be a little bit complex for you but if you trade with patience then within a few months you will understand how to perfectly analyze the market. Being a professional trader you should also read the latest news release as some of the high impact news releases often change the long term existing trend. Since the market extremely volatile during the high impact news release it's better to stay on the sideline and wait for a better trading opportunity. Once the market dust settles down, look for possible trade setup in the higher time frame.
Summary: There are many ways that you can follow to improve your trading performance. But today we have given you the top three tips that can change your life as a trader. Always try to trade the trend line with price action signal. And if you face any losing orders never try to recover your loss rather wait for the next trading opportunity.