Forex Trading Systems 4 Steps
The ultimate objective of any forex trading system is:
1. The trend at the earliest possible detection and profitable items to find in the market to move.
2. The best possible points available to return to market and steps to take profit.
3. The avoidance of "false" signals to a loss.
In theory this sounds good but practice tells us that no system is 100% accurate to the above goals still to achieve.
What is a realistic goal?
A system that achieves 70% profit over a long period of time is doing well.
The 4-Steps to a Forex Trading System of Building
STEP 1: CHOOSE YOUR TIME PERIOD
Determine your trader profile to find out which time is best for you. How many hours per day or per week would you spend on forex? Will you work during the day? Would you like to start daytrading? Read more about the different time periods and the advantages and disadvantages.
STEP 2: CHOOSE YOUR FAVORITE TRADING TOOLS AND BUILDING THE SYSTEM
There are endless combinations can be made with technical indicators which can lead to a profitable forex trading system. Some traders swear by systems that only consist of Bollinger bands while others prefer to voorschrijdende averages combined with an oscillator indicator to an "optimal" point in the market to move when the oscillator is oversold and return to step out when the oscillator overbought. In the next lesson we will give an example to illustrate a simple trading system with entry and exit rules + money management.
STEP 3: SELECT YOUR CURRENCY PAIRS
Each currency pair has its own characteristics, some are very volatile as the EUR / JPY, GBP / USD and GBP / JPY while others, such as the EUR / GBP rather quiet move. For Day-traders, it is highly recommended to not exceed 2 currency pairs to choose while long term traders are comfortable 5-10 to follow.
STEP 4: SYSTEM TESTING AND ENTERED
Is your system ready for use? Begin the first test on a demo account provide at least 3-4 months and make any improvements if necessary. Are you satisfied with the demo results? Open a live account and start trading with small amounts you can increase over time if you continue to book profits on the forex.
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Forex is simple follow the trend and you will rich.
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