3 Profitable Forex Strategies for Beginner Tradersadmin 24 November 2022
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What is a forex trading strategy? A trading strategy is a method of trading. It is very important for a trader in the financial markets to have a trading strategy just as in a battle between two armies or in a soccer match between two teams. Strategy means using the skills and talents, and hiding weaknesses.
In financial markets, successful forex trading strategies have 8 characteristics:
- Transaction time
- Tradable symbols
- The time frame for applying the strategy
- Entry point
- Transaction volume in relation to assets
- Profit limit
- Loss limit
- Emergency exit point
It is not true that a forex trading strategy is without losses. Even the best and most famous trading strategies sometimes have risks.
Trading strategies can also be in the form of a technical or fundamental strategy or a combination of both.
Why Should We Use a Trading Strategy?
As you know, financial markets are one of the riskiest activities in the world, because price changes in financial markets are due to changes in the relationship between supply and demand, and economic, political and social news, as well as unexpected events, have a great impact on market fluctuations.
Due to their risky nature, financial markets also cause the release of two enzymes, dopamine and adrenaline, which cause fear and greed in traders. Trading strategies can control traders’ emotions so that a trader can make rational decisions and trade.
According to surveys of market participants, the main reason for traders’ losses was the lack of control of their emotions in the financial markets.
1. Price Action Strategy
The price action strategy is a popular strategy in the market based on technical analysis. This strategy is also known as the strategy used by banks and financial institutions, although it is said that this strategy is a complete and successful strategy, but this is not true at all, financial institutions and banks focus more on fundamental news and they use less technical analysis.
Price action strategy involves the use of trend lines, price channels, candlesticks and harmonic technical patterns.
This strategy requires a lot of analysis and practice for you to be successful in the market as a price action trader. According to the given explanations, this strategy is considered as one of the best methods for beginners as it has a high success rate that requires a lot of practice but brings positive and profitable results.
2. Ichimoku Strategy; is it Suitable for Trading Beginners?
Ichimoku strategy is an analytical financial market strategy introduced by Goiichi Hoseda in 1930 and took more than 30 years to develop.
Ichimoku strategy is based on both technical analysis indicators and market sentiments, and Ichimoku strategy is perhaps the most successful trading strategy that focuses more on market supply and demand.
Ichimoku strategy is also one of the strategies that does not easily provide a buy or sell signal due to its technical complexity and has many conditions for trading. Nevertheless, it is one of the most successful strategies used by professional traders in financial markets. We recommend beginners to practice this method first on a demo account and then use it on real trades.
3. Getting to Know the Elliott Wave Strategy
Elliott waves is a very old strategy in financial markets, originally developed by Ralph Nelson Elliott in the 1920s and 1930s.
In Elliott Wave theory, each trend has 5 main waves and three corrective waves. Elliott Waves is one of the trading strategies that helped traders a lot during the stock market crises in the 1920s.
Elliot strategy is one of the trading strategies based on technical analysis, and of course, it is a complex but successful strategy in the financial markets, especially in the stock market. Despite the complexity of this strategy, beginners are recommended to use it as a useful and practical strategy due to its low error rate and great success after back testing and mastering it.
Many strategies are used by traders in the financial markets, but perhaps more important than choosing a strategy for trading is sticking to that strategy.
In choosing a strategy, the mood of the trader and his risk-taking ability should also be taken into account, and before using a strategy, it is suggested to test the strategy first in a test environment in the financial markets, and if successful, then in the real market. Deltafx forex broker has provided you with this opportunity so that you can test your strategies first in all kinds of demo accounts.