What is the difference between a fisherman, a car enthusiast and an amusement park visitor?
The biggest mistake a person can make is that they do not try to earn on what they like best. Many of us are result-oriented and completely forget about the process. They spend time at work just because they get paid. But time goes by and life passes in the expectations of the long-awaited end of the work day. It's quite different if the work is fun. You immerse in it and do not notice how time flies. Believe me, the results in this case will be different. And you will eventually get more money.
Trading is like a little life. If you came to Forex to fix your financial situation, sooner or later you will begin to see the former you. The same desire to finish quickly and go do something else. Trading must be fun. And for a start it would be nice to understand yourself. What do you like best? To throw a fishing hook and wait for a bite like a fisherman? To drive your car on the road, first increasing, then dropping speed? Or to ride a roller coaster? Of course, you can do all this at different times, but in order to bring your skills to perfection, you should concentrate on one thing.
Markets are cyclical. Trends are replaced by consolidations, trading in the ranges gives way to new trends. Someone may think that the cyclical opposition of bulls and bears in a narrow trading channel is boring, but experienced fishermen know that one must learn to wait. The fish will bite sooner or later! The exit from consolidation opens truly unlimited possibilities to catch a new trend. The markets are cyclical! Everything depends on your preferences. You can pull the fishing rod abruptly, on the break of the trading range, after waiting for confirmation signals from volumes, Demark qualifiers or other tools; but you also can lead it slowly, knowing full well that the victim will not go anywhere. It's about retesting, which many know how to use perfectly.
Trading from consolidation
If you are a natural born driver and know where this road leads (trend direction), then you can start enjoying driving. You only need to lose the speed sometimes, bypassing the corrections, and switch to a higher gear, waiting for their exhaustion. The market itself will take you to the right place. Such trading systems are called trading on recovery. The simplest of them is a rebound from the moving average, which acts as a dynamic support. The opening of the long position takes place at the break of the high of the MA test bar, the stop order is set lower than the low of the current accumulation of bars. However, you can buy previously formed peaks or use other approaches. Drive the car the way you like it.
Trading on the recovery of the trend
If you come to the amusement park and cannot take your eyes off the roller coaster, you can test your luck in trading against the trend. It is certainly more dangerous than the two systems described above, but after all, "who dares wins!"! The law has long been known in investments: the higher the risk, the greater the profit. The main challenge is to to master it competently. Countertrend trading systems are diverse. You can sell the previous highs, act on the breakout of the diagonal channel or expect activation of harmonious trade patterns.
Trading against the trend
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