The best forex trading strategy ever.
Which is the best forex trading strategy ever? In my opinion there is not one single strategy that is the "best". Every trader will have his or her own personal strategy. I however am a firm believer in simplicity.
For beginners the best forex trading strategy will be one that uses simple technical analysis. It may include only price and volume charting. Or it may also include support and resistance levels. It may simply involve using pivot points, moving averages or Fibonacci levels as well. These are all indicators, of sorts, which provide traders with an indication as to where the price may head. They allow you to trade with a clearer head, enabling you to make better trades with better accuracy.
If however you are a trader who has had some time on his hands to learn forex trading, but is feeling a little more adventurous, you may wish to consider a bit more than simple technical analysis when formulating your strategy. Trading styles are completely individual. Some traders see price action as their most reliable guide. Others prefer to work out their strategy by using different methods such as indicators.
There are many traders out there with completely different trading styles and techniques. What ever you decide to do as far as a forex trading strategy is concerned, always do it in the spirit of your own personal risk aversion. Do not use a forex trading strategy purely because someone else advised you that it would be useful in this fashion. Do it because you feel that you know enough about it to formulate a system that will give you good results.
Of course it will take a fair amount of effort to put together a good forex trading strategy that works well for you. You may even have to tweak it a little to suit your own personality traits and personality style. You should also keep in mind that the results of any particular trading strategy will only be as good as the trader using it. In other words, if you are a nervous or amateur trader, your trading strategy will likely be very unprofitable.
When you are formulating your own forex trading strategy, remember that there is no right or wrong answer. The best strategy that you can come up with is the one that suits you. It is all about finding the approach that best fits your personality and experience level. Many forex traders make the mistake of using the wrong kind of software, when all it takes is a little bit of research to find the right kind of software. Some traders swear by certain systems, while others swear by none.
Once you have developed your own forex trading strategy, it is important that you stick to it. There is no point in changing your trading plan just because you encounter a few losses. If you are going to lose on occasion, then that is the time to sharpen your skills and not use this experience to teach you something else. Just like any other skill, trading the forex requires repetition and practice. You should also develop your own money management skills, so that you know what your risk tolerance is and can change your strategy accordingly.
You should also keep in mind that the most profitable strategies tend to be simple. Complex systems generally do not work very well and can lead to false profits and false losses. In other words, a complicated forex trading strategy can leave you holding the bag in terms of profits and losses for days or weeks at a time. Stick to a simple strategy that meets your own investment goals and you will be trading the forex successfully for years to come.