Flat trends in forex trading
The simplest definition of “flat” is a period of time. Where prices are in the same position range and almost do not increase or decrease.
Flat conditions on Forex are a very dangerous period of time. That’s because the trend is horizontal or sideways and the price is fluctuating. Only between 10 and 60 points can have a negative impact on trading. This is why flat conditions are not a good period for trading. Especially for small investors because although it can be profitable, it does not always cover the cost of foreign exchange differences.
Flat conditions on Forex are also tips for experienced traders
It won’t be difficult to see flat conditions on a graph. That’s because the price movement is only limited to a maximum of 60 points in this period.
Flat conditions on Forex are also tips for experienced traders. When prices stop at a certain level, this means that further increases will begin to decrease.
The thing that is trusting is that a long, flat condition is a signal. The signal is for a strong trend in the future. Although there are exceptions to this rule.
Outside of the duration of this “weakening”, there is the most important thing. This is predicting the right area for the next trend.
Flat conditions in EUR / USD
Is it possible to produce in flat conditions?
In order to do this, there needs to be a change in tactics. You should move to another timeframe and gradually collect profits. In this case, the better thing is to use the channel strategy. Some traders refer to this method of trading as scalping.
Try to see it through the following types of technical indicators. This will help you to determine the flat conditions on Forex:
The Pulse Flat indicator clearly shows the flat conditions using the interface display. This indicator consists of 2 lines. The yellow line means there is no flat condition, green means a flat condition. Another sign is a histogram that helps to determine the sharpness of the price movement on a graph.
iVAR looks like a polyline or a set of lines moving near the level 0.5. This indicator is very easy to use. Flat conditions are above the same level and there is no certainty at level 0.5. When this happens it means that it is not recommended to trade.
A condition is needed so that iVAR can do its job properly: an additional indicator should be used because iVAR itself cannot guarantee a clear certainty.
Stochastic Oscillators and Williams% R are very popular indicators. The indicator has a similar formula shown on the chart. They only differ in their range (Stochastic has a range from 0 to 100, Williams – from -100 to 0).
These oscillators are included in the standard set of instruments from the MetaTrader trading terminal. You can turn on these instruments in the “Navigator” window in the “Indicators” tab.
To determine the end of the price range, you can also use CCI, Envelopes, MACD, Price Channel and others.