Description: We take a look at some of the best ways you can identify good FX trading strategies
There are numerous FX trading strategies that can be used to trade the forex markets. Presently there are many individuals creating FX trading strategies for use by other traders, but the problem remains knowing what is best to use.
There are reviews scattered all over the internet claiming that one trading strategy is better than the other but what they fail to understand is that a strategy lauded as the best by one trader may not exactly be the best for another trader. Fortunately, many of the strategies available all over the web are successful. Some of the strategies have been used by experienced traders and are now being taught in forex trading schools, while the rest of them have not been tested that extensively.
So which ones are the best fx trading strategies?
Firstly, the best forex trading strategies are those that do not only make the traders some money every month, but also help bring out the best trading practices from the individual, helping them grow steadily and develop trading abilities over time.
Most of the time, traders focus on strategies that only make them money in the here and now, without looking at the big picture, and this results in long term profits that are not sustainable for long periods of time. This is why it is common to hear traders wondering why their strategy stopped working all of a sudden after being very profitable for a while.
So summarily, traders should first of all look at the trading strategy to determine its efficacy to be sure it is going to work for the long haul. For example, any strategy that only works during specific hours may stop working in the future when changes are made to the trading rules by the broker. This explains why strategies made to work during the Asian trading session failed after brokers started charging higher spreads. When you get a trading strategy with a long term focus, you can always tweak it as the days go by to meet your particular needs.
Secondly, you need to ensure that the trading strategy is one that would suit your trading level. Most traders normally start small and increase their account balance gradually. Therefore, using a trading strategy that should only be used on bigger accounts on your micro account is a recipe for disaster. The same applies when you use a strategy meant for a larger account on a smaller one.
Thirdly, you also need to confirm that the strategy is one that falls into your preferred trading window. As one living in Australia, there is no need to use a strategy that would require you to be awake during the start of the European session. Of course you can always wake up in the middle of the night to trade but at that moment, you are not at your optimal best.
Remember we said that a good majority of forex trading strategies work, the only problem is that traders just do not stick to the trading rules. So if you are going to ignore the rules of the strategy, you might as well not bother trading, as you will only blow the trading account in time.
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