The 2009 financial climate is leaving many people feeling uncertain about Share Trading, one only has to observe the charts and read the news on businesses in strife, to realise just how unpredictable the Share market is. Yes there is still good gains in it, and with many investments available at relative bargain prices, there is plenty of chance to make some serious long term dollars.
Because of this, many investors are now switching their gaze to the Forex markets as an alternative income generator. There are a variety ways to trade Forex, Day Trading or swing trading, the list goes on, but there is one thing they all offer the unwary, a high level of risk if you don’t know what you are doing.
There are two core analysis techniques; Fundamental Analysis, basing trading decisions on news events and Technical Analysis, which involves interpreting the charts using a variety of indicators. This is how I like to trade as I am not reliant on news feeds. It doesn’t matter which you choose, to minimize potential losses, you are going to have to learn Forex trading before you start committing any hard earned cash.
Some very good basic information is offered by Babypips.com, at no cost, but they do not teach into how to create Forex trading strategies.
What is a Forex trading strategy? Simply put, it is a system for setting money management rules, analysing the progression of a chart, establishing a possible trade entry point (Setup), confirming the entry point, opening a trade, establishing an exist strategy to both minimise losses and to take profits.
A trading strategy is of the utmost importance when Forex trading, without it there is no way of working out why you entered a loosing trade and how to correct it, or why the trade worked and how you could improve it.
As you commence trading, a trading strategy provides the system for trading on a Demo account. These are provided by most brokers and allow you to make some test trades, without risking real money. You give yourself an account balance and trade as the charts move honing your trading strategy and watch your account either profit or crash. You’ll soon find out what works or not as the time goes by!
To learn how to develop a a specific trading strategy for profiting from market rebounds, there is a free video course which will teach you a trade called the “Rubber Band Trade” and shows you what is involved in developing a trading strategy.
It’s a great little series put together by a Professional Trader and covers the technical analysis for all stages of this specific trade. Once you have tested this strategy on a Demo account and made it work consistently, you can apply it to a real account and start catching some profitable pips whilst you develop and test other trading strategies that will make your Forex trading a success.
I studied and tested this trading strategy and still trade it when the charts set up correctly. A quick 20-30 pips? Why would you miss the chance?
To start grabbing rebound pip profits get the Free 5 Day Video Trading Course.