Forex Trading Strategy CCI
Trend forex is a friend for a trader. This phrase has proved the truth that, because traders feel helped by following the trend. To be able to get it needs a simple strategy used by many traders from all trading levels.
Trend forex is a friend for a trader. This phrase has proved the truth that, because traders feel helped by following the trend. To be able to get it needs a simple strategy used by many traders from all trading levels. Following the widespread trend is highly recommended because of its ease to identify movement and trend direction and can be used multiple times. A strong trend can save you from a series of harmful buying and selling.
This article will identify 2 benefits of simple trends, the following strategies plus the forex technical analysis. But starting, it’s good if you first know why trading trend is a popular strategy among new traders and experienced traders.
Strong Trend and Imperfect Strategy
Do you have a perfect Forex trading strategy? A perfect strategy is a winning strategy all the time. But the winning strategy 100% does not exist.
Therefore, it is very important to learn from imperfection. Trend trading is a simple way to cover up some of the imperfections of the strategy by identifying the strongest trends in the market.
For example, if the market moves up in a strong trend. In such a trend condition is not important what strategy is used for time entry, you just need to do the buying action. But this does not mean that all traders will be winners. Keep in mind that you have to master the way of identifying the trend of price movements. The simplest way to use the CCI indicator.
When you see a strong trend in the market, most likely trading is definitely in the direction of the trend. For example, just look at the recent uptrend in the Japanese Yen pair (USD / JPY, GBP / JPY, EUR / JPY, AUD / JPY, and NZD / JPY).
Let’s assume you’re using the Commodity Channel Index (CCI) as a tool for time entries. Notice how each time the CCI is below -100, the price responds with a reversal. Of course, not all trading will work this way. But as you follow a strong trend, each trading is influenced by the number of buyers who jump into the market. The more buyers involved there, the price will be pushed and become higher. Therefore, experienced traders will look for stronger trends.
If you are going fishing and have a choice of fish ponds, which one will you choose?
Then, how do you know which pond is more fish?
Identifying a strong trend allows you to see more potential “fish” to capture. Assume for a moment that you are a perfect trader, who can capture the top and bottom of each wave appropriately.
Notice how more pips are available on long trades. And when the price is saturated you will try to open the position opposite to the direction of the trend. In short, this is a strong tendency for reverse price moves. By aligning trades in the direction of trends, you automatically adjust your strategy to market momentum and open yourself to more opportunities to earn pips.